Does it feel as though technology is impacting your accounting firm and your clients much faster than it did just five to 10 years ago? Well it is, and Moore’s Law explains why.
In 1965, Gordon Moore, co-founder of Intel, noticed the number of circuits that could be placed on a chip doubled every year. In 1975, he revised that forecast to doubling every 18 – 24 months. When the number of circuits doubled, the speed at which the chip ran also doubled and the power the chip consumed declined. Bandwidth and storage increase at an even greater rate than processing power.
To put it in perspective, the first hard drive developed by IBM in 1956 had 5MB of capacity, was the size of two refrigerators and leased for approximately $250,000 per month. Today, the smallest iPhone X comes with 64GB – that’s more than 12,000 times the capacity of the first hard drive, and it fits in your pocket.
When software developers write code today, they’re often writing it to run on chips that will be produced two to three years from now rather than the equipment that exists today. So if the technology you’re using is three years old, it’s five to seven years behind the curve. It’s no surprise then that some busy professionals feel intimidated by new technologies or fear they can’t keep pace with change.
The headlines just make matters worse: robo-accountants will put us out of jobs, blockchain will do away with audits. While accounting firms will certainly be impacted by disruptive technology and it will change the way we work, there are steps we can take to prepare. The alternative is ignoring it, falling behind and becoming irrelevant.
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I’m here to tell you that you can keep up and it might not be as scary as many are making it sound. Here’s a look at what you can do now.
1 . Stay calm
As the rate of technological change continues to grow exponentially, it can be uncomfortable or even frightening for people who don’t get excited about change. But it can also be an incredible opportunity for those who embrace it. So avoid panicking and take a calm, rational approach.
2 . Educate yourself and your firm
Understanding is critical. You don’t need to become an expert on predictive analytics, machine learning, blockchain, AI, algorithms and other disruptive technologies, but you should cultivate a collection of voices you can trust, assimilate the information and form your own opinions.
Read everything you can on the subject. Attend conferences, webinars and workshops. Identify people in your firm who are passionate about these technologies. Send them to training opportunities and let them share what they’ve learned with you and your leadership team.
3 . Make a plan
We know that accounting firms will be disrupted by technology, but the profession isn’t going away. It will just be different than it is today.
Building alignment and getting everyone in the firm moving in the same direction is critical. If people are confused about the firm’s vision and leadership, they won’t buy into the changes that need to be made. An outside facilitator can help with strategic planning, envisioning or business transformation and add some much-needed perspective.
4 . Communicate with your team
One of the most important things your firm needs to do is let your team know that you understand the changes that are coming and have a plan to meet them head-on. Many of the people you work with are just as intimidated by emerging technologies and dire predictions as you are.
If you don’t take the time to reassure them you have a plan, they will look for a firm that does.
The four Cs of managing change
Keeping up with the pace of change requires commitment, courage, capability and confidence. I’m sure most of us would prefer to start with confidence, but it only comes after having the courage to make a change, making a commitment and developing the capability.
Remember, this is not a do-it-yourself project, and you don’t need to reinvent the wheel. Seek out peer communities and solution providers who can help you along the way.