The array of practice management solutions available on the market makes it difficult for accountants to decide which one to choose, writes Trent McLaren.
I was determined to research and understand the practice management landscape for the UK accounting industry after landing here permanently from Australia last month and after reading, researching and speaking to as many vendors as possible, it’s easy to get lost in the noise and become paralysed with what decision to make.
Alvin Toffler, American writer and futurist, predicted that overchoice would be a problem for future generations nearly 40 years ago, which I believe is exactly what we’re seeing in the accounting software market.
He said “Ironically, the people of the future may suffer not from an absence of choice, but from a paralysing surfeit of it. They may turn out to be the victims of that peculiar super-industrial dilemma: overchoice.”
In the same article I was using to research for this piece, Frederick Muench said: “First, we are constantly bombarded with options and choices we believe will make us happier at every turn, and then after we make a decision, we are told that better choices exist.”
So already therein lay two problems for UK accountants trying to plan and map out their future for technology and infrastructure: firstly, you’ve got so many options to pick from that it can be hard to identify the real-deal amongst all the noise.
Secondly, even after you’ve decided on an option, the constant marketing push from the other software providers has you second guessing all of your decisions. Then you’d be constantly looking for this absolutely perfect creation (which doesn’t exist).
Additionally, the bigger your accounting firm is, the more partners or decision makers in play, adding another layer of complexity.
I often get asked for comparisons to the Australian practice management software market which, to be honest, does not suffer from this problem of overchoice in the practice management space. It does suffer from a lack of innovation amongst the bigger platforms which, in turn, leaves the firm stuck waiting for the next wave or next big player to solve their needs.
The GBU Australian technology report for accountants for 2018 pointed out that one in four firms have implemented a new practice management system within the past three years, with 75% choosing Xero Practice Manager.
Now this ties back to my earlier point. Australian’s don’t suffer from over choice, as they really only have one or two great cloud options that firms are happy to utilise. Xero Practice Manager or tools like Karbon for worfklow. Otherwise, it’s a mix of server and cloud-based products like Advance PS, MYOB AO/AE, Sage Handisoft or CCH iFirm.
Being paralysed by overchoice can actually slow the growth of the software market. If a firm flip flops between different platforms because they’re constantly searching for a perfect solution they’ll never make a decision.
Additionally, if software providers aren’t getting the revenue, they won’t have the same level of resources to build their product at a first pace. Having a choice is good for competition, but having too much is bad business for everyone.
Now that I’ve painted a problem it’s important to understand the path to navigate. Building out your workflows and technology stack doesn’t need to be a hard slog. It needs to be planned and calculated.
You need to know what you’re trying to achieve, the outcome you’re looking to deliver to your clients and the environment you’re trying to create for your employees.
Your tech stack is broken into four key elements:
- Cloud accounting ledgers such as QuickBooks or Xero.
- Cloud workflow and client management preferably integrating into your client ledger.
- Cloud tax (must integrate with your accounting ledger and potentially your workflow tools).
- Client onboarding and payments integrating directly to your accounting ledger and workflow provider if possible – something like our own product Practice Ignition!
The optional add-ons that compliment your clients’ paperless journey are tools such as Receipt Bank, HubDoc and AutoEntry but fundamentally for practice management in your firm you should focus on these four key categories, with your client accounting ledger and tax is the most important integrations.
Yes, there is a lot going on in the UK market but if you break down the key elements that are important to your firm, navigating your way through can be a walk in the park. Having the right mindset and team members employed to manage a change management project is critical.