No single professional can be an expert at everything.
For instance, imagine your primary healthcare provider says that you need heart surgery and then adds, “Don’t worry. I can do it.”
Ridiculous, right? We can all agree that when it comes to medical services, we need specialists.
Yet, when it comes to our financial and legal lives, we are not always willing to hire a specialist when we need one.
I was thinking about this recently while my husband and I were watching the Apple TV show “Margo’s Got Money Troubles,” which received eight Emmy nominations. In it, Nicole Kidman plays a former professional wrestler named Lace who becomes an attorney and represents the main character, Margo, and her family in a legal battle. She is hired because she is Margo’s dad’s longtime friend.
While I understand this is a fictional TV show, and without giving away any spoilers, I found myself distracted by how many issues Margo’s attorney did not seem to raise or investigate.
More importantly, I wondered why she did not bring in legal specialists. Although I am not a family law attorney, it was obvious she was out of her depth. As a result, her clients faced unnecessary stress, preventable burdens and the risk of a poor outcome.
So why wouldn’t Margo’s family hire someone who specialized in that area of the law?
Specialists are costly
The most common reason people hesitate to hire a specialist or expert is cost. Why pay a large retainer and a higher hourly rate when your existing people may be able to handle the matter?
Here, we should analyze the cost of hiring a specialist against the matter’s complexity and what is at stake to make a rational decision. If you have a divorce that could include potentially losing custody of your kids or splitting up your retirement account, or there is an issue involving a prenup that might be defective, you need to hire and pay an experienced family law attorney and not a friend who is a general attorney.
Another good example of cost versus results is an IRS audit.
A relatively small IRS examination may be something your existing CPA or enrolled agent can manage. However, when I had a client with a complicated tax examination, I would bring in a tax attorney who specialized in IRS controversy matters. While I organized and presented the tax documentation in the best light possible for my client, the attorney handled the IRS procedural and tax law issues.
That additional expense was justified because the potential cost of taxes, penalties, and interest to the client from not having the additional expertise was too great. I would explain simply to clients that I handle the numbers, and the attorney does the letters.
Fear of the unknown
Another reason we resist bringing in a specialist is that it is human nature to do what is easiest and most familiar, particularly when we are dealing with something stressful. It is much simpler to call your CPA or attorney of many years who already knows you and your history than to start over with someone new.
However, bringing in a specialist does not mean you need to replace someone you trust. Your existing professionals can still play an important role while the specialist handles the part that requires different expertise. If your existing advisors work well with others, they can coordinate with the specialist and keep the project moving forward. They can also help the expert get up to speed faster and reduce the specialist’s time spent on work they can do more efficiently.
Going back to Margo, her attorney did not need to resign. She could have brought in an experienced family law attorney to handle specific issues while she continued to manage the client.
My people can handle it
Sometimes resistance to bringing in someone new comes from your existing trusted advisors or key people in your organization. They might not want an outsider to look at or question their work. They might not want another relationship they have to maintain or another person to explain things to.
There is also generally a concern, especially with a larger client, that the specialist will try to take over the client relationship.
Interestingly, as a specialist, many of my referrals come from other CPAs and EAs, although it took years to build those relationships. Those tax professionals understand that because I am not a generalist who prepares annual taxes, I do not want to take their clients. Also, I would not have their referrals if I made them look bad in front of their important client or tried to refer them to someone else. If anything, I want to applaud the professionals for bringing me in, and I want to make them look good for doing so.
Reassure your existing team, especially your controllers and key employees, that the expert is there for a specific purpose, not to replace them. Using the medical example, the specialist addresses the issue that requires additional expertise, works with the people already involved, and then moves on to the next project. That is collaboration.
If you think you may need a specialist, start by discussing the project with your trusted advisors and ask whether they can handle it or if bringing in an expert would help. If they say they can do it themselves, ask about specific experience and wins with similar matters. You need to know whether they can complete what you need successfully or if they will be practicing on you.
Collaborating with a specialist
When you bring on the specialist, clearly define the assignment and review the engagement agreement to make sure it matches your expectations. To minimize fees and stress, have the specialist work directly with your existing professionals and share files whenever possible. You do not need to be the go-between. An initial meeting to define responsibilities will also make sure everyone is on the same page.
The importance of referrals
Finally, ask your trusted advisors for referrals.
Going back to Margo, Lace did not need to know every area of law to be a valuable attorney to Margo’s family. She needed to recognize when something was outside her expertise, know the right person to call and bring that person in at the right time.
Good doctors know other good doctors and know whom to call when you need care outside their specialty. The same is true of your professionals.
Part of their value is the network they have built. Sometimes the best thing your trusted advisor can tell you is, “This isn’t my specialty, but I know someone who can help.”
Michelle C. Herting is a CPA, an accredited business valuation specialist and an accredited estate planner specializing in succession planning and estate, gift and trust taxation.