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Interview with Martin Wambach, Managing Partner
The survey focuses on 10 of the largest professional services firms by revenue and number of employees in Germany. The results were based on 300 assessments from respondents from Mittelstand companies which were requested to rate sub-categories such as expertise, client orientation, communication, terms and conditions and willingness to recommend. The survey was conducted using professional methods and independently of professional services firms. Thus, we assume that the result is reliable and we, Rödl & Partner and the audit service line, are very happy about it. We believe this has validated our efforts in two ways: on the one hand, our brand and communications strategy has proven to be effective. In targeting the Mittelstand shaped world market leaders, our “Rödl & Partner” brand enjoys a very high level of brand awareness and our online visibility is the second highest in the sector. On the other hand, we stand assured that we are on the right path with our internal project “Zukunft WP” that was launched in 2012.
All measures within the project are oriented towards ensuring that Rödl & Partner is uniquely and perfectly positioned on the market. In addition, we follow a conscious differentiation strategy to set ourselves apart from our competitors.
The key to high client satisfaction lies in our clear-cut focus on Mittelstand shaped world market leaders. We are precisely oriented towards their needs and requirements in terms of both the substance of our solutions and the organisational arrangements. The central success factor is that our auditors think and act like entrepreneurs; this means that we speak the language of our clients worldwide, we have the courage to make decisions and we think outside the box, meaning that we care and assume responsibility. All our activities must add a clear and measurable value for our clients. This can be achieved only when you truly understand your client's business and know the areas of their interest. It is not without a reason why we strive to be the “agile caring partner” for our clients. This also includes promptness, non-bureaucratic processes and the development of long-term personal rapport. On this basis, mutual confidence is fostered, laying the groundwork for client satisfaction.
We approach expertise in the broader sense. We require our auditors to be excellent professionals and personalities at the same time. We view specialist knowledge in the sense of the interdisciplinary business model of Rödl & Partner. We are not only true accounting and audit professionals, but have an in-depth understanding of and a genuine interest in tax and legal advisory as well as management and IT consulting.
Client orientation means that we listen to our clients, understand and provide them with our services while in close personal contact. Our clients must feel that our services add value to their business and that we are passionate about assisting them in their matters.
Communication is always the key success factor. Everyone should know and understand Paul Watzlawick's axiom “One cannot not communicate”. Every behaviour is a form of communication, whether intended or unintended. In this sense, communication should always take place in an aware and targeted manner. In the end, our services are always addressed to people. This holds true also e.g. for audits of annual financial statements. Behind every balance sheet item, there is a business process, and business processes are shaped by people and their motivations. In this sense, it is important to understand the motives behind people's actions.
As for the sub-category “terms and conditions”, we understand it as “the value added arising from the service the client has paid for”. We want to provide top services and receive fair compensation. “Fair” means that we are paid for the hours of work and qualifications necessary to provide the service, as well as in relation to the client's economic success that our consulting service was instrumental in. Also in this area, we want to highlight that all our professional services are tailored to specific client requirements and are not comparable to any standard products.
Of course, it is fantastic that we were named the best audit firm in all 4 survey categories. This result motivates us to continue to follow the adopted course of action.
Our in year 2012 formulated goal remains unchanged: the audit service line is the driving force behind the success of Rödl & Partner. In addition to the aforementioned orientation, we see a central challenge in digitalisation. The necessary framework for this has been developed in the form of our Digital Agenda. In the audit service line, our eAudit2.0 project, the development of the IT audit area and the implementation of new technologies such as e.g. the Microsoft Surface Hub, directly contribute to the transformation process. Already in the upcoming audit season 2016/2017, we will conduct audits mostly on a paperless basis and launch the first remote audit applications. This shows that we are ready to break new ground. Furthermore, we will position our audit service line so that we are perceived by the market as true experts in areas such as compliance, fraud, risk management, internal audit and management and monitoring of subsidiaries. Thus, we are reaching a new performance level and supporting the growth of Rödl & Partner. Another important objective is to actively promote Rödl & Partner as a highly attractive employer. That is why we will enhance our communication to the market, including our understanding of the audit profession and why it counts among the best in the world.
We need to understand that the changes on the German audit market we forecasted 4 years ago are actually taking place and continue to gain momentum. The typical regional audit firms without international reach, which now still enjoy an established reputation, will be under severe pressure. They will be the losers when it comes to the consulting and audit of German companies with international operations. The large Anglo-American “audit factories” are feeling the consequences of the EU audit reform; they are losing market share in the segment of auditing and consulting capital market-oriented companies.
We at Rödl & Partner can and want to be the winners emerging in the wake of the development trends. With the size of our firm today, the level of brand awareness, the true-and-tested interdisciplinary business model, our global reach and the state-of-the-art infrastructure in form of the Rödl Private Cloud, we have created a unique and non-copyable starting position for this. Every day, we hear from our clients that our aspiration to be the “agile caring partner for Mittelstand shaped world market leaders” perfectly fits their requirements. In this sense, I expect our firm to reach above-average growth. We will double our turnover within the coming 7 to 10 years, unless we “shoot ourselves in the foot”. We were always successful in doubling our turnover in the past 25 years. The recently published Lünendonk study confirms this assessment. Our growth is faster and stronger in absolute terms than that of our competitors. The turnover difference between us and number 10 in the German market is now 97 million euros, 69 million euros to number 9 and 45.6 million euros to number 7. This gap that separates our competitors from us can no longer be compensated by organic growth.
I cannot assess the extent of further mergers taking place among competitors in order to bridge the gap. But we all know that mergers in this size range are anything but easy and not always practical. Disregarding this aspect, we can already tell that as of today only 7 companies enjoy the confidence of the market about their ability to provide professional services to global German companies. Accordingly, I expect that the consolidation of the German audit market will speed up and that we will further strengthen our market position.
updated 30 June 2016
Martin Wambach
Managing Partner, Chief Digital Officer
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