Conquering The Disruptions - It Still Isn’t Too Late
Multiple industry thought leaders have dwelled on statements like ‘the traditional accounting firm is likely to become obsolete’, ‘tax preparation is going to be taken over by automation’, ‘artificial intelligence is going to take away manual jobs in the future’. That apparently indicates that your practice is under threat of becoming obsolete if you are not future ready. The fact that transformation is inevitable, simply can’t be denied, but the question is, should you be worried already if you haven’t applied to some of their methods yet? The plain answer is NO.
Although, people envisaging these possibilities aren’t completely right, but they aren’t wrong either. Therefore, as an accounting firm, it is important for you to start making significant inroads to prepare for the accounting profession ‘of the future’. There’s no time like the present to start.
AI and Automation are not the threats like they are being perceived
Lately, buzzwords like AI, automation and machine learning have been doing the rounds too often. What people tend to presume from them is that core accounting tasks will be automated and most likely it will drive many people out of work. The real deal is that automation at best does the repetitive tasks following similar patterns. Such tasks don’t really need much of your expertise but certainly take away a considerable amount of your productive time.
Good news for you is that, a human touch will always stay in demand. Also, the regular tax updates will increase the need for trained and skilled manpower that can communicate the advice to clients efficiently and deal with diverse tax situations. Also as cliched it may sound having much of the cookie cutter tasks automated, will give you much time to focus on strategic, review and business advisory tasks.
Innovative approach for client acquisition
You will have to think innovative in order to retain the clients at hand and even more out of the box to bring new ones. It’s a sad reality that return on investments with networking events, conferences, exhibitions, trade shows are dipping year after year. With so much competition already in the marketplace, even word of mouth methods won’t yield much. However, marketing tools of social media is such a hit in this era and using them boosts your reach to a bigger audience at a much lower price.
Having said that, I don’t intend to make you drop your plans for the next event, but just asking to consider digital marketing and social media as a part of your overall marketing strategy. Even if it is not your area of expertise, there are agencies to help you with it. My suggestion is to just take baby steps and divert just 10% of your marketing expenditure that you do right now. Also there is nothing to feel that you have missed the bus. You can start today and trust me, it’s an investment rather than expense.
The clients aren’t going to change overnight
Client requirements have changed over the years. New clients will have new requirements and higher expectations that has outgrown from just bookkeeping or tax preparation jobs. The key to keeping the clients happy is to anticipate their expectations. You need to start investing to acquire the suitable resources to fulfil them.
Also, the requirements differ from client to client. For example, most baby boomers still prefer their documents to be picked up or dropped off rather than uploading scanned copies and organizing them over client portals on their own. That’s an errand you have to do. On the other hand HNI clients or senior employees in big corporations expect you to be a dependable financial advisor for their wealth management.
Your approach needs to be adjusted according to client type. You must be able to strike the fine balance between priorities, involved efforts and angle of valuation. This will help you keep all the existing clients content with the services. Also, with the new ideas on client service, you must be able to sign up more new clients for longer run.
The DIY approach is for rookies
A vast majority of SMBs only use services like bookkeeping, tax and audit. With cloud solutions such as QuickBooks, a lot of small businesses have entered the marketplace trying the DIY approach. Their quests are even supported by things like web tutorials, YouTube videos, webinars and search engines so that businesses can access just about anything necessary to handle their accounting and bookkeeping needs on their own. As a result, a lot of self made accountants have burgeoned over the years.
But, this act of moving accounting online doesn't precipitate the end of accountants. Years of specialized study, a degree/license and on top of that, requirements of CPE are not going to waste so easily. Sooner or later, businesses do suffer the perils of freelanced accounting work because a professional always has an upper hand. However, what does push accountants to the margins is how inexpensive and client oriented an accounting firm can be. Becoming a trusted advisor to your client will help you not just retain the existing ones, but win new ones for a longer run. All you need to have is the readiness in terms of skill-sets, resources and technology to fulfill their requirements.
The challenge of staffing is there to stay
Staffing has consistently stayed atop the list of challenges in the accounting industry, as reaffirmed year after year by PCPS survey by AICPA. Unfortunately, firms have struggled significantly in this area. The changing work landscape has forced them to rethink how to recruit suitable candidates. Many have even resorted to outsourcing and then regretted their decision. Losing control of your core work is not a wise choice anyways.
Hiring offshore staff and flexible work arrangements is one of the sound solutions to this problem. This method is a little uncomfortable for some firms, but you should think in that direction. It gives you the choice to select candidates from a wide international talent pool which is inexpensive, aptly experienced and qualified, and can handle most of the day to day accounting tasks. For that to happen successfully, you need to embrace online collaboration where everyone involved in a project can work on the same data at the same time, wherever they are located.
Since you can hire an offshore staff at a fraction of the cost of local hire, you are easily saved from the fee pressure and still boost profitability and take more work. An offshore staff can save you over 70% and the savings keep growing per year per person as you grow the offshore team.
The disruptions aren’t going to happen all of a sudden
If you recall the scenarios from 2 decades ago and compare them from what’s in the present, you have got to accept that a lot of things have indeed changed. That includes the accounting software & tools, internet speeds, marketing strategies and even risks of data security. But at the same time they have all taken their own sweet time to come this far.
Though change is occurring more rapidly than ever, but it is not going to happen instantaneously. However, in this era where we are capable of moving the information within seconds and dynamics of operations have become so transparent and real time, it is best to keep the eyes open and ride the waves of change.
Thinking about what developments are coming next and how they may impact current ways of working will be the key. Equally as important will be evaluating how future innovations could be used to improve the way clients are serviced and anticipate their future needs. That way, firms will be operationally prepared to respond to disruptions.
Embracing innovation into profession has become a norm in any industry right now. Just keep in mind, transformation actually means to get better, step by step with passing time and not reinventing the wheel.