Mark Lee asks how quickly accountants need to adapt to changes in their environment.
There's always someone who will say that accountants need to change and that they need to do so soon. Drawing on recent developments that have affected the profession, there are a number of examples I could point to:
I'm probably one of the UK's most active accountants in social media, but I'm realistic. I don’t advocate that accountants in practice have to do the same – it’s not a crucial new marketing facility and sadly few accountants are gaining much benefit from it.
HMRC's new powers were the subject of much consultation before they were enacted in 2007. But the practical realities are only now becoming apparent.
And although compulsory iXBRL corporate filings become a reality next April, many accountants have yet to plan for the changeover.
In each case various commentators have been urging accountants to change: to avoid missing out; to avoid getting caught out; or to avoid leaving things to the last minute.
This is nothing new. It was just the same before the changeover to Self Assessment in 1997 and the subsequent move to corporate Self Assessment. There are plenty of other such examples too.
I've no doubt that many accountants will negotiate these transitions and wish subsequently they had been better prepared. But such preparation would have distracted them from earning fees and there was no time.
We chose not to make preparation a priority and let it get crowded out by the pressures of day-to-day work. And, I suspect, we prefer to focus on those issues of which we already have experience.
Accountants are trained to look backwards rather than forwards. Could that be why so many of us cope with change as it happens rather than plan and prepare for it in advance?
A popular parable for this is that of a frog in a saucepan of water. If the water is heated slowly the frog doesn't really notice the temperature changing and is eventually boiled alive. (Sorry about the image).
If the frog was dropped into a pan of boiling water, it would immediately leap out and continue living.
Many commentators tell accountants the changes they are facing are equivalent to the gradual warming of the saucepan. These commentators suggest that if the accountants don't recognise what's going on and make big sudden changes then they are doomed. Like the boiling frog.
I disagree. I don't see the need for massive changes. Some accountants who adapt first may gain a competitive advantage over the others, and some who refuse to adapt will eventually run out of clients and work. But it will be a gradual process. None of the catalysts for change demand revolution in the accountants' offices or their marketing efforts.
Some commentators dismiss this attitude as apathy. Accountants refusing to face the future and sticking to the old tried and trusted routes to market and service levels. So what? If accountants are too busy to plan for the future they can defer such activity until they do have time.
Alternatively if accountants are very busy, but struggle to generate the profits they deserve then of course they need to take time out to consider their options. I regularly reference the old adage: "If you carry on doing what you've always done, you'll carry on getting what you've always got."
If you want things to change, you have do things differently. In this context some people find it helpful to engage a business coach or mentor to motivate them to identify and implement appropriate changes in their practice.
I should stress that making time for effective preparation can reduce stress by getting up to speed with new obligations and opportunities before they set in. The alternative forces you to cram the key points and may slow you down from getting truly on top of the issues. In the meantime, how many of us look to blame others for what are our own shortcomings? I admit that's a trap I try very hard to avoid!
Accountants are special. Practitioners will often wait until clients need a new service and will pay for it. Until then the accountant may feel they have no incentive to devote time to learning about a new system, approach or opportunity. In this respect accountants are unlike many other professions. I suspect this passive stance stems from the knowledge accountants have that many of their clients come back year after year. The concept of recurring compliance work (on accounts and tax returns) has no equivalent in the legal world, for example.
Accountants could be more effective, more profitable and more relaxed if they took time to explore new opportunities and get used to new working methods before they were forced to use them.
But unlike almost every other commentator I accept that the majority of accountants will get by to their satisfaction without having to leap out of their saucepans.
Only when a number of clients move to a new accountant will the incumbent consider what they can do to retain the rest of their clients and attract new ones. Will there be enough time? In most cases, I believe the answer is 'yes'.
What do you think?