For an accountant, staying on top of the game has never been more vital in an industry that’s becoming increasingly competitive. Competitors are not just around the corner. They might be across the country or on a different continent.
Thanks to the Internet, clients have no qualms about seeking out the right kind of expertise and accounting skills. Here are several tips for an accountant who wants to remain the first choice in any client’s mind.
1. You need to be technologically fearless
The fact we no longer write in hardcover ledgers is a testament to the fact accounting and technology have been evolving hand-in-hand for decades. In recent years, cloud computing has been driving massive changes to the industry, one example, have meant accountants can have a live view of client data, so no there is longer need to chase them on the phone or via email periodically.
Artificial Intelligence (AI) is building on this to delivering even more benefits. While at the moment AI is largely found coping with often tedious administrative tasks, such as bank account reconciliation, some practices are already experimenting with smart assistants as the first line of customer interaction. Sage’s Pegg provides a perfect example of what this looks like and you can try it right now. Businesses can ask Pegg simple questions like, “How much money do I owe?”. No need to wrestle with nominal codes, or even a full-blown accounting software package.
But all of this is chicken feed to the technological revolution that might be on the way in the form of blockchain. Put simply, a blockchain is a kind of ledger or database that is decentralized (that is, it’s spread across the Internet, so concurrent copies exist in multiple places) and it’s impossible to defraud. Its uses within accounting should be obvious. These uses will also be abundant, especially if governments embrace the technology, as appears to be happening.
The question of whether accounting firms will have the know-how to fully embrace blockchain is another matter, however, although you can bet clients will be asking about it very soon in their initial consultations.
And the biggest real-world manifestation of blockchain in today’s world – cryptocurrencies like Bitcoin – is almost certainly set to become yet another aspect of everyday accounting. Some businesses already accept Bitcoin and while all convert it to regular currency before accounting for it (or record it as an asset), there may well become an increasing need for accountants to deal with cryptocurrencies directly. It’s not hard to imagine the challenges inherent in what is such a volatile monetary system (or at least right now).
In the future, accounting practices may choose to enhance their technological expertise, so it is on a par with their basic ability to provide advice on tax and legislation, the bread and butter of many practices. Some firms might even choose to put their technological focus at the center of their business to distinguish them from the “regular” accounting firms. Where will you stand in all of this?
Here’s some advice:
- Start to read up on blockchain, so you at least have a broad understanding on the subject, if not a technical understanding – trade organizations such as the IFAC have already written extensively about its likely impact upon the profession;
- Contact your representative at your software vendor to see where they stand on blockchain and if they intend to implement it at any point in the future;
- Keep on top of government legislation and thinking when it comes to blockchain – the federal government is already trialing it, for example;
- Learn all you can about cryptocurrencies, although arguably this technology is so volatile right now that waiting for the situation to settle before investing time and effort might be advisable.
2. Focus on the client
In the recent The Practice of Now 2018 report, Sage spoke to 3,000 accountants around the world to gauge how they see the landscape for accountants today. In the U.S., 83% of accountants said they think clients expect more from them now than they did five years ago.
It’s not that clients are becoming more demanding. They are also savvier. They realize that digitization is making the job easier for accountants, so they’re interested in getting their value in other ways. And ultimately, we live in an increasingly customer-focused world where people simply demand more for every buck they hand over, whether that’s to an accountant or to a supermarket.
The awesome news is that the aforementioned technological revolutions–harnessed optimally, of course–mean that accountants can free-up time to become an advisor and “business partner” for their clients. For example, the fact that there’s now a live feed of data means accountants can spot problems before they even arise–and therefore a superb opportunity arises to make contact with the client. Add in some clever Artificial Intelligence in the near future and the accounting software at the heart of a practice might be able to spot problems before both the accountant and client become aware, via machine learning and pattern-spotting abilities!
Most accountants entered the accounting profession because they wanted to have relationships with their clients that extended beyond the mere yearly or quarterly number crunching. Well, that’s becoming a reality. But the accountant has to be ready to embrace it. It’s easy to say you are–but are you really? Are you prepared for what might be a fundamental cultural shift within your practice and a redefining of your own workflows as well as that of any of your colleagues? What measures can you put in place right now to make all of this a reality?
The Practice of Now 2020
Discover how accounting is on the brink of positive disruption and what accountants and bookkeepers should do to be successful.
3. Embrace the next generation
What do you think is the biggest demographic within the U.S. right now? Baby boomers? Senior citizens? According to population estimates, it’s actually Millennials–those born between 1983 and 2000. If you do the calculations, you’ll realize that this generation are entering middle age and, yup, they’re starting businesses. And they should be on your radar whether you like it or not.
Research carried out by Sage for the Walking the Walk whitepaper revealed that Millennials in business are unusual–relatively speaking, of course. Unlike the previous Gen-Xers, they’re characterized as being industrious and high-achieving–although it would be a crucial mistake to believe they’re similar to Baby Boomers.
For example, 62% of Millennial entrepreneurs say they have sacrificed profit to stay true to their personal values. 63% of them believe they will start more than one business in their lifetime. They’re inherently technologically-savvy, of course, having been born into technology and 41% of them believe that technology is going to make the concept of “your desk” redundant. Instead, they believe, everybody will work via a mobile device.
All of this represents a stunning cultural shift compared to any generation that’s gone before but, of course, this generation is going to demand that their accountant is at least sympathetic to their beliefs and motivations. A 50-year-old individual pretending to be hip will just be embarrassing but an accountant who knows and respects this generation’s values is certainly going to be in a better position than one who doesn’t.
Here’s a good example: while it might be worth suggesting to a Baby Boomer that they cut the losses of a failing business and sell, to a Millennial whose ethical beliefs make them concerned about the staff within that business this could simply be the wrong thing to say. It could even be offensive. A better suggestion might be to start a rationalization process or to work on a redefinition of the business’ mission statement. Similarly, the environmental beliefs of Millennials mean they’re just less likely to want to be involved in businesses that cause environmental damage, or that are wasteful.
It isn’t just with a firm’s clients that Millennials are shaking things up. They’re also the new recruits for firms moving forward and research shows that Millennials again have different expectations compared to previous generations. They’re less likely to tolerate the dull and monotonous work, for example, and this can lead to a high staff turnover that adds unnecessary overhead costs for the business. Technology can again help here by again taking care of these same repetitive tasks, and the Millennials will again simply expect this kind of technology to be in place.
Four ways to grow your practice
Building a successful practice goes beyond great client service. It’s equally important to spend time marketing, selling, and embracing efficiencies.