2015 trends: Accountants and technology

tech iStock_0_0.jpg

iStock/Thinkstock
Community Correspondent
Sift Media
Share this content
Tags
2

Love it or hate it, technology is permanently changing, and accountants are now expected to keep abreast of these fluctuations in order to keep clients happy.

Gone is the day - and many may rue it - of employing a mere calculator, a good pen and a ledger.

Gartner recently released its 10 strategic technology trends for the coming year. These were centred on three themes: The merging of the real and virtual worlds, the advent of intelligence everywhere, and the technology impact of the digital business shift.

Indeed, at the 2020 Group annual conference in Birmingham recently, US chairman Chris Frederiksen spoke about firm's needs to cater for mobile workers, and focus on cloud and harnessing good data to provide clients with sound advice, and automate your own processes - thus giving you more time to do what work you do best.

Which is why it's perhaps unsurprising that according to the recent Xero Trends 2015 survey, more than 60% of firms think technology will have some or a big impact on them. But despite this, keeping up-to-date with technology is not seen as a major challenge for practitioners next year. 

It could be that this is because - for around 27% of them at least - they are satisfied just as they are.

Making practices as user-friendly for staff and clients as possible, reducing fixed costs in running the practice and a need for clients to see them as tech-friendly were the top three technology priorities for survey respondents. 

Other tech-related challenges included auto enrolment, which practitioners said will be the biggest pressure "from above" in 2015. And firms' tech and software set-up is for 37% of accountants an area they think most needs to change next year. 

Getting clients to use the technology they wanted them to scored quite low, but the biggest issue was retaining current clients and making them more profitable.

Well-documented is the ability of using the right tech tools to create profitability for both the firm and the client. Drilling down to data, automating processes such as auto-population of tax and VAT returns and collaboration by use of cloud accounting packages can speed things up and leave the accountant open to spending time on what they do best - and what they think client wants most according to the survey: Tax advice. 

Technology can help them too with what they think clients want second, third and fourth on the list - competitive pricing, collaboration and virtual FD services. 

However there are a few things standing in an accountants' way. Barriers to change included time investment by a substantial amount (75%), followed by financial investment (32%) and convincing others in the practice of the need to implement change.

But the time spent implementing new systems adopting technology that suits your practice, can save lots of time in the long-run - and its a similar tale financially. 

In addition, most practices aren't entirely sure they need to reinvent the wheel. More than 45% said "an evolution, not a revolution" was needed, simply to embed changes recently made. However, there's a split, with a further third that think they need to change quite a bit.

Whether its putting those already thought out practices into play or changing your systems entirely, you don't have to do it alone.

AccountingWEB's Practice Excellence Conference on 6 November at Dexter House, Royal Mint Court in London has a variety of workshops designed for every stage - and you choose which one you attend. 

Replies

Please login or register to join the discussion.

New & Sticky

I think the big impact that technology will have on accountants is to either bring them new service lines or make them more sticky. Both of which are very important to accountants in terms of (a) margin, and (b) longevity, which leads to practice value in the event of sale.

 

We developed a content management system for Excel that accountants around the world use to provide their clients with business planning and advisory services that they couldn't otherwise have provided (evolution not revolution is indeed our plug). But the same applies for all of the Xero plug-ins, on-line aps, etc. And because much of this is new (a) it is yet to be commodity priced, like a VAT return is, and (b) it is perceived as value-add by clients, which also attracts a higher margin.

 

The 'stickiness' comes in a couple of ways. Firstly, if the accountant is the only firm providing the software as a service then there is the client perception that leaving the accountant means losing the software / service. Secondly, the software as a service model brings with it slightly different ownership structures. Many accountants have their own Xero account and run their clients accounts within this. This means that the accountant owns the information. I'll leave people to draw their own conclusions on the implication of this (a) in the event of unpaid bills, and (b) reduced risk that a client will leave in the future.

 

For a lot of the above reasons, the first mover advantage is becoming particularly important. Offering a new product in the market therefore means higher margins, a novel service offering and a longer potential relationship. And that's before we get into staff retention through greater engagement / development and all the latent benefits!

Thanks (0)
avatar
By JC
24th Oct 2014 08:45

Universal data not ‘lock-in’ …

In the area being discussed there is very little that is new in terms of data – just how it is presented and even then little has changed in interpretation

Just how many times do we need to reinvent the wheel – after all, data associated with accounting has remained broadly static for many years

Yes the delivery mechanism has evolved, although not nearly to the extent of ‘disruption’ as many would have us believe. More evolution rather than revolution, which is contrary to what some commentators have said. After all Cloud in its current guise has been going now for around 15 years under various names (ASP, SaaS …) and even prior to that we had the client/server model (thin/fat client) for many years, in one form or another since the 60’s

With this in mind why has no-one addressed the principle of universal data standards? Well the answer is easy – it is in nobodies interests to do so! Possibly an industry lobby against?

After all who cares about the client, and making core data seamless & portable would allow providers to be changed at will, as well as avoiding any issues with provider failure (i.e. liquidation). But do providers really espouse these ideas – probably not because they are perceived as threats, although if their products really were ‘best of breed’ these concepts would enable them to clean-up and put all their inferior competition out of business

So in reality what we actually have is a plethora of fairly mediocre products all claiming goodness know what benefits over their competitors, yet unwilling to deliver the fundamentals of universal data standards

In the past the concept ‘sticky’ used to be called ‘lock-in’ and was largely frowned upon as an abuse of the client. Why therefore has this idea suddenly re-surfaced and gained more traction in preference to ‘open systems’?

‘Stickiness’ is surely precisely what we are trying to get away from by introducing greater transparency and a reduction in proprietary solutions with all the associated lock-ins?

Therefore if you see someone talking apout proprietry systems then run a mile!

 

Thanks (0)