When the judges convened to size up the runners and riders for the Accounting Excellence Awards’ inaugural Digital Transformation gong, we were looking for genuine case studies of successful projects.
Not just persuading a client to stop using spreadsheets or desktop software and start using cloud accounting tools, but transformation tales with tangible benefits: from software sceptic to tech convert or how the introduction of a particular tool, process or tech stack had brought about a transformation in a client’s business or personal life.
And for Azets, the winner of this year’s award, there was a human story behind the numbers presented in their case study that will be all-too-familiar to many accounting firms with small business clients – but a story that ultimately had a happy ending for all concerned.
Swamped with paperwork
Azets’ transformation project involved Compton Dundon School (trading as Propel Education), a specialist educational resource in Somerset for learners aged between 5 and 14 years, designed to meet the needs of children and young people with autism.
Like many similar establishments, the school found itself swamped with manual processes and paperwork. At the start of the school’s transformation journey, the directors were responsible for managing the bookkeeping, as well as all other ancillary processes.
From an initial meeting with Azets, it was clear the current setup wasn’t working, with the directors struggling to keep up with day-to-day administration tasks along with running the school.
“I was ready to throw the towel in, but this meeting was a turning point for the business as well as my own mental well-being,” Jon Lloyd, a director at the school told AccountingWEB.
The path of digital transformation never runs smoothly
The initial scope of the project was a straightforward client request to implement a cloud bookkeeping system. However, as anyone who has worked on similar projects knows, the path of true digital transformation never runs smoothly.
At first, the client wasn’t interested in a wider tech stack as they had existing processes in place. They also declined training on the new bookkeeping system.
In a follow-up meeting some months later, it became clear that the system was not being used to anywhere near its full potential, and the problems laid out in the initial meeting remained the same.
“Sometimes you have to hold your hand up and say it hasn’t gone right,” Russell Frayne, head of UK digital accounting solutions at Azets told AccountingWEB. “They’d migrated to Xero but refused the training, which happens frequently with these types of projects. Sometimes as accountants, we’re afraid to challenge the status quo, even if we know from experience it’ll ultimately cost them more.”
Full process review
From there, Azets undertook a full end-to-end process review to understand the components of their client’s finance function – something that is now undertaken on every implementation.
The approach decided upon was to address the most significant issue first – the directors’ mental well-being. Together with the client, Azets drew up a plan to remove as much administrative burden from them as possible as well as make it easier to get paid.
The firm then implemented a front-end process change using Dext to capture relevant paperwork to process each month. Invoices previously sent to local authorities using Word were replaced with electronic invoicing using designed templates for each local authority and adding a Crezco payment link to make it easier for the local authority to click and pay – speeding up payment collection. These basic changes delivered significant process efficiencies and reduced reliance on the directors.
Once these benefits were delivered, the directors were inspired to pursue other digital avenues. These included the introduction of Dext expenses for employee expenses and automated statement reminders,
The project then moved on to KPIs and performance, with Azets helping to redesign the charts of account for better reporting and visibility, creating easily reportable management packs and a three-way Fathom board pack including financial and non-financial KPIs which are reviewed on a quarterly basis.
All of the above allowed the school to completely restructure itself and enabled one director to step away as headteacher to focus on the business and grow revenues and profitability. They increased the school capacity and reduced overheads significantly as a result of being much closer to the numbers.
A ‘truly life-changing’ transformation
“Propel Education's transformation came about as a result of a client conversation about their own personal well-being, as opposed to the financial performance of the business,” said Azets’ Russell Frayne. “The human conversation around the client's personal circumstances ultimately led to the digital transformation that improved their work-life balance as well as the performance of the business.”
“We could have easily closed the business or sold it previously when we were ready to walk away,” Jon Lloyd, Director. “This transformation has been truly life-changing for us”.
“Many of the basic problems businesses have can be fixed by getting the fundamentals right,” concluded Frayne. “Too many people go straight to the bright shiny things. Sit down with the client and look at the business as a whole. Ask what outputs mean the most to you and your business and focus on using technology to help them achieve it.
Get ready to transform your practice and clients
Getting digital transformation right can lead to huge benefits for your practice and your clients, but it can be complicated. As the Azets example shows, getting the most out of technology relies on people buying into the improvements and new processes that may be needed.
As sponsor of the Digital Transformation award, Sage was delighted to see such a range of great stories from the entrants. Chris Downing from Sage commented:
“We know how important the relationship between accountants, bookkeepers and their clients is, that’s why we’ve partnered with Will Farnell to publish our book ‘The Human Firm’ that gets to the heart of how to build a digital, scalable, human firm. We look forward to hearing even more stories of how practices are revolutionising the way their practices operate and building deeper client relationships.
The Accounting Excellence Digital Transformation Award is sponsored by Sage - visit the Sage website to download their latest guide - The Human Firm and discover how the range of integrated Sage software solutions and services can help you transform your practice and your clients' businesses.
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