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What is the point of automation today?

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Richard Sergeant investigates the role of automation in the life of today’s accountant and finds out if it really creates more efficiency or improves services.

15th Feb 2023
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The availability of technology often opens up new ways of realising what is possible, but it’s often easy to forget that automation is something that we as humans have always tended to seek out. 

“The application of technology, programs, robotics or processes to achieve outcomes with minimal human input”. This classic IBM description of automation is as relevant to clocks, and looms as it is to today's world of bookkeeping software and inter-related apps.

Automation is part of our lives, and embedded in the technology and services we offer for clients, even if we don’t necessarily perceive ourselves as particularly ‘digital’ at heart.

But we also know, perhaps instinctively, that automation only takes us so far. We value human professional oversight as well as the human touch. Later we can explore where it might be leading us, but it’s also useful to take stock first.

So what is the role of automation in the life of today’s accountant?

The efficiency point

The main argument is around gaining those much needed efficiencies. There isn’t a firm in the UK that isn’t busy, and with recruitment and staffing at the top of the list of issues, the drive to handle more, better, and often with less is a high priority.

The question, therefore, is whether automation allows us to make more time, or more capacity?

Lara Manton, the director of LJM Bookkeeping, sees it as being both: “For me, automation is about managing workload and capacity, whether that’s freeing you up to work with more clients or to offer more services.”  

And it’s a strong point. Freeing ourselves from tasks which just occupy time rather than require skill, should increase productivity overall. 

Citing reminders and alerts through practice management Penelope Allard, the director of Wild Bookkeeping, develops this idea by seeing automation as a way of ensuring client service itself is on rails: “Automation drives customer service. I want to ensure that nothing is missed, that we are efficient and of good value to our clients.”

Improving services

The other aspect is how improvements can be made to any particular service.

An example is how removing manual processes can improve quality. As Manton explained: “If everything is integrated and going from application to application you are removing the human and the human error. Automated tasks then allow us to deal with the more nuanced items, provide better customer service, and look at what the numbers mean, not just enter them.”

Creating the space to focus on more meaningful work is powerful and familiar rhetoric.

Firms like Celtic Bookkeeping & Accountancy Services explain that the time gained provides the opportunity to focus on staff development, which benefits service delivery. As founder of the firm Leanda Daddow said: “It lets us reduce the repetitive data entry, and spend time teaching staff and helping them to build on their other skills.”

Creating a work environment that works for you

Automation also has the reputation for being an important building block that allows you to choose how you work.

Long term digital native and early accounting tech adopter Alex Falcon Huerta, from Soaring Falcon Accountancy, is a good example: “I want to automate everything and anything I can, and have done since starting in business. Implementing automation has allowed me to scale effectively, allowed me to bring on new staff in a timely way, and actually given me the chance to work anywhere in the world. 

“It’s also given me more personal time. Health, wellbeing and alone time, which I value a lot.”

Although Falcon Huerta may be an extreme example compared to some, the narrative is that automation can provide you with avenues to explore in terms of how you structure firm and deliver your services.

If automation is everywhere, why is it hard?

However, the irony is that making it work takes a lot of time and effort.

Despite being a fan of automation, Allard is still cautious when it comes to actual client work and data: “I am not a fan of bulk processing invoices and receipts. Certainly the use of OCR can speed up input, but I don't think you can replace a skilled bookkeeper for ensuring that each is treated correctly. I have inherited too many sets of accounts where this has gone wrong. The same with bank feeds.”

And The Number Ninja’s Emma James points to how much of the efforts to get automation working can still fall on the accountant rather than the software vendors: “Very little of my automation is off the shelf, most of it is custom development or by implementing tiny things like text expansion, keyboard shortcuts, or little apps like Workspaces. If you're reliant on vendors, then there's a risk that we only automate what we're ‘allowed’ to.”

Another consideration for small firm owners is weighing up the cost vs benefit. As practice owner Della Hudson argues, “We have low volumes and, much as it pains my technophile heart, it is sometimes just cheaper to do things manually than to pay for automation especially when licences are sold in blocks rather than individually.”

The growth/automation paradox

There is also the elephant in the room, which is that with all this technology and automation we are exactly where we started: short on time and resources.

Keen tech watcher and implementer John Toon from Beevers and Struthers also observes this: “If firms weren't growing, automation would create more capacity for staff to do more with their time (not necessarily more accounting work).”

But the reality is that most firms are growing, particularly the ones that invest in automation, and this is essentially a resource investment that sits alongside staff recruitment to manage the status quo.

Until firms get really serious about systemising, then automating, we're going to be constantly caught in the feedback loop referenced above. That requires a considerable investment of time, money and expertise”.

Automation is a fact of accountants’ and bookkeepers’ lives, and has been well embraced. And so it should. It brings opportunity, and it provides the ability to create fulfilling roles and really helps clients. 

Without being pessimistic, it is also a journey that can never be completed, and needs tremendous investment to move from being something that helps us to manage what we have, to what accelerates us beyond.

The next wave of automation needs to help push across that gap, and really start to make the difference.

 

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Replies (6)

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By Hugo Fair
15th Feb 2023 17:28

“If everything is integrated and going from application to application you are removing the human and the human error. Automated tasks then allow us to deal with the more nuanced items, provide better customer service, and look at what the numbers mean, not just enter them.”
Except that, as often as not, your newly 'freed up' time is now needed to check & correct the results of the automation - and is NOT spent on more 'strategic' tasks that sound so much more rewarding (but for which the world isn't clamouring to pay).

To be fair some of the quotees make exactly this point (albeit more obliquely), which leaves the unanswered questions ... Automating what, and in order to achieve what?

Automation has, in its broadest sense, always been part of human progress ... what else was the invention of the wheel, or harnessing a horse to pull your plough?

But most types of automation have one of two primary impacts:
A: An immediate reduction in human input that (less obviously) is followed shortly afterwards by the realisation that you've invented the need for a whole new class of skills merely to keep the automation from imploding;
B: An increase in output (more applicable to physical goods rather than services) that turns out to be required merely to 'stand still' in terms of global production - due to increases in population and improving economic expectations.

These are why the 'promises' of the '50s and early '60s (a world of permanent leisure without the need to work) were not remotely realistic ... and will remain forever out of reach.

There may yet be cataclysmic (environmental) changes or apocalyptic (human) events that force major & rapid changes on our world & society, but automating bank feeds are just another tool in an accountant's kitbag ... requiring us to keep up-to-date but changing nothing in the core concepts of a client's business or the role of an accountant.

Thanks (4)
Replying to Hugo Fair:
Richard Sergeant
By Richard Sergeant
16th Feb 2023 09:33

Thanks Hugo, certainly the intent here was to show that automation doesn't necessarily free up time and resource. But it does provide choices. Further automation underlines that accounting firms are black holes when it comes to resource - you can chuck in as much as you like and still not have enough!

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By johnjenkins
16th Feb 2023 10:10

Let's dispel the myth that automation or more technology saves time and effort. This is totally wrong. Automation creates more information and more things to do.
I can go through a list of automated stuff that has only created more work (maybe in different areas).
Natural progression is always best but if you automate you need to be sure you have the backup to deal with it. Unfortunately automation is used mainly for cost cutting, which it never does. I will admit that cost cutting in some areas to finance expansion might well work if applied correctly.

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Replying to johnjenkins:
Richard Sergeant
By Richard Sergeant
16th Feb 2023 10:52

Hi John,

I think this article backs that up nicely.

R

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By JD
16th Feb 2023 14:23

''An example is how removing manual processes can improve quality. As Manton explained: “If everything is integrated and going from application to application you are removing the human and the human error. Automated tasks then allow us to deal with the more nuanced items, provide better customer service, and look at what the numbers mean, not just enter them.”

...or more accurately automating tasks means you are automating the errors/blind to them. Entering the data (by a skilled person) means that you do challenge what the numbers mean and are spotting areas of difficulty rather than blindly pushing to the next part of your system - after all we have all seen car drivers in the fog, without their automated lights on.

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Replying to JD:
Richard Sergeant
By Richard Sergeant
16th Feb 2023 17:53

As outlined, automating the tools for the job is only part of the equation. Automating the admin side of life is another- we’ll definitely explore both in more detail (and other bits too).

It should be fairly clear that no professionals take automation of data processing for granted…

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