A range of events can trigger a crisis: a drought, a change in political leadership, a surge in the oil price or – as we know all too well – a virus.
Crises can occur locally and remain more or less localised, as with South Africa’s recent unrest in KwaZulu-Natal and Gauteng. Or, as evidenced by the ongoing COVID-19 pandemic, a crisis can hitch a ride on our world’s interconnected economy and go global.
What all crises have in common though, is that they make landfall with little to no warning and can ricochet with impact after impact. South Africa’s shopping malls, national highways, and warehouses are no longer burning or being looted, but the economic effects of the destruction will be seen and felt long after the clean-up. And, even as vaccination programmes roll-out around the world, the socioeconomic impact of the pandemic continues to affect lives and livelihoods.
There’s no denying that a crisis can have tragic costs and consequences. However, it also has the potential to accelerate positive change – and with change comes opportunity.
Accountants make a comeback
Before the pandemic, companies across business sectors were steadily adopting and implementing digital tools and technologies to improve their operational efficiencies. Many Industry 4.0 pundits debated the hot topic of advanced technologies (such as the cloud, artificial intelligence, automation, and machine learning) replacing some human workforces. Accountancy, for example, was labelled a dying profession, with smart financial management and administrative software soon to render accountants obsolete.
When the pandemic hit, national lockdowns around the world sent businesses running for cover. For many companies, the need to digitise suddenly became a matter of life and death as offices shut down and non-essential workers were told to stay home. Interestingly – and contrary to many pre-pandemic predictions – as the demand for digital tools and technologies surged to keep the wheels of commerce turning, so too did the demand for accountants to guide their clients through the crisis.
From number-crunchers to trusted advisors
In the event of a crisis, first response teams are mobilised fast to mitigate impact. Recent global and local crises have demonstrated the crucial need for healthcare workers, police, and community leaders to protect people’s physical health and businesses’ commercial properties. Behind-the-scenes though, accountants are responding with equal dedication to help their clients navigate this period of uncertainty with their financial health intact.
Businesses, big and small, have experienced various ups and downs over the past 18 months. The upshot is that many companies have turned to – and continue to call on – their accountants for critical business advice and support. In addition to their traditional skilled services such as credit or market risk assessment and cash flow management, accountants are increasingly asked to provide strategic decision-making support based on intelligent forecasting.
There is an enormous opportunity for firms to use advanced technologies and tools to augment their core offering with value-added services. In other words, rather than cementing the demise of accountancy, the surge in digitisation is enabling the transition from the traditional accountant to a trusted advisor.
Our 2020 Practice of Now survey interviewed small and medium-sized businesses in South Africa, the US, Australia, France, Canada, Spain, and the UK – and over 80% of respondents expect their accountants and bookkeepers to provide more tech-enabled advisory services. For the same reasons as their clients, accountants must embrace digital technologies, particularly cloud-based systems, to shift swiftly into remote working business environments.
The firms already based in the cloud were ahead of the game when the pandemic hit and were able to maintain business as usual with little disruption.
As accountants and their clients increasingly align their technologies for greater synchronicity, both parties will improve their relevance and market positions. In South Africa, 82% of accountants acknowledge that financial management firms will lose competitive relevance unless they empower their systems and human workforces with new technologies. Already, two-thirds (65%) of South African accountants report better customer relationships because they invested in technology that enables them to deliver a smarter, faster service.
Digitally empowered super-accountants
In a crisis, clients need urgent assistance and knowledge related to their cash flow, sustainability, business leads, staff and customer retention, and market forecasting. This is not the time to adhere to quarterly or monthly report cycles; accountants must respond quickly with helpful advice based on real-time intelligence. Businesses navigating periods of uncertainty need help with present-day challenges as well as with preparing their operations for longer-term sustainability.
Cloud-based, digitally empowered firms can use advanced technologies and tools to:
• Manage repetitive number-crunching tasks,
• Conduct continuous audits,
• Analyse future scenarios,
• Gather and process huge volumes of data for actionable insights,
• Highlight unexpected market events or anomalies for immediate re-strategising, and
• Access and share information easily for faster decision-making.
When the dust settles
As current crises settle, firms with the ability to straddle traditional accountancy services with intelligent business advice are going to stand out. Accountants empowered by smart technologies will have more time and more intelligence to help their clients identify new business opportunities, design their new business strategies, and connect their clients to other companies for potential synergy. It’s crucial that firms realise the importance of using a crisis to advance their own processes, people, and practices for ongoing relevance.
Making it through a crisis can be an all-absorbing process, with heads down focusing on day-to-day survival. As understandable as this is, all crises result in change; no economy goes back to exactly the way it was before a crisis. Thus, firms need to look up and prepare for the new working world that awaits them. Now is the time – the opportunity – for firms to digitally enhance their operations and empower their people as advisors – not just for their clients’ business growth and sustainability, but also for their own.
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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