Is it time to modernize your accounting practice? Accounting is a competitive profession and it doesn’t look like that will change any time soon – so your firm needs to work hard to stay ahead of the rest.
How you respond to the challenge of competition from other practices and the increase in client demands will ultimately determine your firm’s success or failure over the next five to ten years.
According to Sage’s Practice of Now research, which sought opinions from accountants worldwide, 40% say they feel less confident about the prospects for their practice compared with 12 months ago. Just 28% feel more confident about their prospects.
An overwhelming majority of accountants (67%) feel the profession is more competitive than ever, and only 7% disagree.
A key solution is to ensure your practice is as up to date as possible – you need to take a hard look at the way things are done, and seek to optimize and improve. Client services should always be in the line of vision.
Diagnosing the problem
But how do you know if your practice requires modernization? Taking a look at your technology set-up could offer a clue. In today’s digital world, there’s really no reason why everything can’t be connected to create an experience that everybody will appreciate.
Technology is disconnected
Where does your data live? For the past few decades, accountants have built their industry on spreadsheets, but this approach is increasingly problematic.
For example, there’s very rarely one single spreadsheet with all the data on it.
More likely you have data across multiple spreadsheets, and there might even be a handful of applications thrown in there too for the likes of managing client details.
And that’s before we even think about issues around data protection introduced via legislation such as the General Data Protection Regulation (GDPR), which says privacy should be by design.
Outside of a simple password, how secure can spreadsheets even be? While they have their place, they’re no longer the answer to every need.
If your business is relying on spreadsheets, this could mean the way you do business might not be as efficient as possible.
Three steps to modernize your accountancy practice
In short, a good practice is one where everything is seamlessly connected. So how can you make that happen for your firm? You need to give a little attention to certain areas of the way you work – and to the technologies you use. Here’s how.
1. Understand the role different technologies can play
With so much innovation taking place – from cloud-based accounting software to artificial intelligence and automation, for example – it’s easy to get overwhelmed and confused about where certain technologies can have the biggest impact.
But investing in the right type of technology could end up being extremely beneficial for your practice.
It’s therefore vital that your firm puts an emphasis on education so you can build an understanding of exactly what different technologies do, the benefits they provide, and the processes they can improve.
Industry events such as the World Congress Of Accountants, Accountex and the Future of Finance Summit (UK), or AICPA Engage and IMA’s Annual Conference (US), will go some way towards helping firms discover the latest products and trends.
Not only do these events offer you the chance to hear from the profession’s leading innovators, they also provide opportunities to talk to other accountants about what has worked and the mistakes they have made.
2. Focus on your business goals
When it comes to digital transformation, a one-size-fits-all approach simply doesn’t exist.
For both long and short-term goals to be achieved, firms will have particular technological gaps that need to be addressed.
In order to get the most out of their investments and help them progress to the next stage of digital maturity, solutions have to be specifically chosen with these technological needs – and the firm’s wider objectives – in mind.
For example, your firm might want to enable its accountants to access client data when working remotely, or move away from face-to-face meetings to a greater reliance on remote videoconferencing.
Whatever they may be, focusing on individual business goals – from increasing compliance to building new revenue streams – will provide structure to digital transformation strategies and help make sure you focus your attention on the right solutions.
3. Stay one step ahead
New technologies become outdated faster than ever before and this trend is likely to continue. As such, you have to avoid concentrating on what’s happening in the present and try to take more of a future-gazing approach.
This may seem like a major challenge but it’s essential for any firm wanting to remain ahead of the competition and being prepared for whatever is on the horizon is important.
Thinking about what technological developments are coming next and how they may impact current ways of working will be key.
Equally, as important will be evaluating how future innovations could be used to improve the way your clients are serviced and anticipate their future needs. After all, using technology to stay ahead of client demands will be one of the most effective ways of remaining competitive in the years to come.
But it’s important to remember that adopting this visionary mindset can’t be the responsibility of just one person.
Your firm should encourage the entire workforce to always have one eye on the future and be constantly thinking about how to move to smarter, more efficient ways of working.
That way, you will be operationally prepared to respond to digital disruption and lead the profession in the technologically driven world of the future.
Conclusion on modernizing your accountancy practice
One thing we can all agree on is that modern firms certainly have their hands full.
From building a brand that will attract new business and talent, to plugging the skills gap and keeping pace with the biggest technological revolution the profession has ever seen – as well as turning a profit – there is currently a huge amount for accountants to manage.
But managing change is going to be a key skill.
The only option for a practice that wants to grow and thrive is to embrace this change, and to make it as central to the business function as servicing client needs.
Ultimately, you need to ensure you and your colleagues come to work each morning with this philosophy in mind. Only then can you be assured that modernization as a process will continue so you can see the benefits.