Maxwell Locke & Ritter has been called crazy for the way they hire employees, with some peers saying it would never work — but decades after the Top 100 Firm established its hiring model, they have regularly boasted a turnover rate that’s lower than the professional average, as well as positive feedback from both staff and clients.
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The secret? MLR only hires experienced professionals with at least four to five years of public accounting experience at firms the same size or larger. Austin, Texas-based MLR has 162 employees and reported $51.93 million in revenue last year.
According to the firm’s incoming leading partner, Lesley Hargraves, and talent and culture manager Hao Hue, their narrowly focused hiring practices have raised eyebrows from other firms, including many fellow members of firm association CPAmerica.
“I think in the beginning, decades ago, they thought we were crazy,” said Hargraves. “I think they were all just sitting back waiting to see that it didn’t work. But now, yes. I mean I probably go to three or four conferences with them a year and it is always commented on.”
While that skepticism has been proven wrong, Hargraves said it remains a hot topic and, as far as she knows, no other firm operates similarly. “It is always, ‘Well, that has really worked for you guys.’ Like they still think maybe now will be the moment that it won’t,” she said. “So we continue to be the only one among all of the firms in that organization with this hiring model.”
Right out of the gate
MLR’s unique staffing strategy has been a hit with clients, according to Hue. “Most of our team members actually come in at the senior associate or manager level,” she explained. “And that allows us to provide our clients with experienced, high-quality service from day one.”
That higher service level was the goal from inception, Hargraves echoed. “It’s really rooted in the early history of our firm, and it was a really intentional decision,” she said. “We wanted to build — well, our predecessors wanted to build — a different kind of firm. We wanted one centered on experienced professionals who can come in and provide meaningful value to our clients from day one. It also truly is a key driver of the flexibility that we’re able to provide for our team members. With the experienced hire model, it’s just a lot more, you get through that easy stuff really fast and then you can focus on solving problems with your clients and it gives you a lot more flexibility in your workday.”
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MLR also offers geographic flexibility for these employees, with team members in more than 20 states across the U.S.
As far as the enhanced client service goes, Hargraves speaks from experience, having come from Ernst & Young 17 years ago. “I worked in the Big Four, and we had that very structured, typical model where you have interns and staff and then you have seniors and, you know, very structured,” she recalled. “And what I spent a lot of my day-to-day time doing was teaching interns or staff how to do a bank rec or how to test a bank rec, or how a bank rec works, how clients book entries, and so because we don’t have that entry-level model, you get back all that time.”
Clients benefit from that truncated learning curve, Hue reports, and are happy that “they see a lot of continuity on their engagement teams year-over-year, and because of that they’re able to build stronger relationships with their people. So it’s worked really well for our clients.”
More stability
Experienced professionals also expedite processes, said Hargraves. “You kind of slide through the stuff that comes naturally to us, that we can do quickly, and then you get to work with our clients on the more complex topics and help them solve problems,” she said. “You’re not reviewing and spending as much time helping teach. Although we are all teaching each other things all the time, right? We’re always growing and learning, but, I think of myself when I came out of school, and I didn’t even understand how a bank rec worked and that was part of what my day was spent doing, is just learning basic accounting.”
Under MLR’s model, staff members appreciate not getting muddled down in those basics, according to Hue and Hargraves, and the firm also reaps rewards. “For our firm as a whole, it’s really benefitted us because we get to hire people who know that they want to be in public accounting,” Hue said. “And that tends to translate to stronger retention, lower turnover, and just more stability across all of our teams. So it works really well for us internally.”
At a crucial time when fewer people do, in fact, want to enter public accounting, MLR has still experienced the same staffing issues as other firms, despite hiring at a higher experience threshold. Post-COVID specifically, MLR was able to bolster recruiting efforts by hiring more remote staff, beyond the “remote team members here and there” that had previously been the norm. “Being able to embrace the remote and hybrid model has really allowed us to expand that candidate pool,” Hargraves said. “That’s been a real win for us.”
“I think just generally coming out of the pandemic, we were experiencing challenges with hiring just like everyone else, but since then it’s stabilized a lot,” Hue said. “It’s still competitive, but it feels a lot more balanced. One thing that we’ve noticed is that candidates are a lot more thoughtful. They ask questions about flexibility and development opportunities, really showing that they want to find their long-term fit. And they’re more intentional about it. So that really aligns well with how we approach hiring and retention — it works out. But, yeah, [we’re] definitely seeing a lot more thoughtfulness on the candidate front.”
Hue and her team make sure candidates really consider whether they are the right fit. “We are really intentional with making sure that they understand our model,” she said. “We take time to really explain it, like coming in and letting them know we’re not really big on titles as a firm and we have a very flat structure and yes, this is unique. Yes, this is different from all the other firms, but this is how we do it and how it’s worked really well for us and we want to make sure that people come in knowing that this is how it works and that they’re comfortable with it before they move on in the recruiting process.”
“I think what’s really unique as well [is that] it feels like a very flat structure,” Hargraves added, explaining that the firm still has seniors, managers and partners, and designates seniority by experience level on projects, but titles are not as strict. “We’re not really big on titles, but the learning curve here — I think sometimes that’s the biggest surprise. Our team, part of what they love is how quickly they get to be exposed to new things, learn new things, be challenged. I happen to be somebody who — I always tell people I wish this wasn’t true about me — but man, I really need that to be happy in a job. But don’t you sometimes wish you didn’t? So you could just go home every day at 5 and watch Netflix. But coming here, I was shocked at how quickly I was able to learn new things and be exposed to new things because of the model we have and the structure we have.”
At the entry-level, as Hargraves experienced it, “You didn’t have this big full picture of what a project looked like and how the firm was run. And you also didn’t get to necessarily touch some of the more technical topics that maybe was a role that the manager or senior manager could only tackle. And here that’s just all accelerated. So your learning curve can just go through the roof.”
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