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As technology continues to infiltrate all areas of the accounting industry, practices must use it as a tool to transform into an advisory business.
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How to transform your accounting business into an advisory business
18 February 2017
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11 minute read
In a 2016 report from Times Higher Education, accounting and finance was identified as the profession that is at the highest risk of having jobs eliminated by technology. The core tasks of accounting, taxation and financial management were identified as having a staggering 95 per cent probability of being automated – meaning that if you study accounting and finance, there is a greater than 50 per cent chance of your job being disrupted in the future.
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Scary? Can that really happen?
‘Not a chance’, you may be thinking. ‘I deliver a high-quality service for a fair fee. The robots are coming for the financial planners (the ‘robo-advisers’), not those of us in accounting. On top of that, accountants are consistently rated one of the most trusted of all the professions.’
Think again. As in industries before yours, ‘digital disruption’ is driving manual and repetitive tasks out of accounting. Algorithms can quickly calculate key metrics and provide high-quality financial analytics. Forecasting and planning tools enable the average business owner and finance manager to take on the analysis that has previously been provided by an accountant. Regulatory changes and tax simplification are doing away with the preparation of tax returns – the industry’s bread and butter.
Considerable commentary has been written on how the accounting profession should respond to the threat. Expand the value that you offer your clients. Transform yourself into a true advisor. That may entail restructuring your business to provide business planning, business advisory, and personal financial advice to combat competition.
This focus on value-added services is hardly new. As technology rips away the simple, repetitive and automatable tasks, the ‘winners’ from digital disruption are those who harness the opportunity, leverage the technology and move up the value chain. Just ask the travel industry, where online booking sites gutted travel agencies. Then a new breed of agent emerged, focusing on complex travel and higher value analytics for corporate business.
The good news – technology is also your friend
The good news – actually, let’s call it the great news – is that technology is also providing new opportunities. The new age accountant will embrace them with gusto.
Technology enables you to know much more about your clients, as well as to build your brand.
Imagine there is a digital tool that enables your client, and you, to have a complete picture of their wealth, including the value of their home and car. This tool enables them to see what they are spending, easily tag expenses ready for tax time, and receive value-adding tips. Most important, all these services can all be packaged under your brand.
That capability exists today. The reason this matters is that it makes you look smart, like someone who is embracing the digital age. It gives your clients valuable information that would otherwise be beyond their reach. But here is the real punch line: it gives this information to you, and you can turn it into leads for advisory business. All of that is available now, off the shelf, ready for you to embrace.
The connected marketplace is a source of revenue, not threat.
There are more than 500 connected apps in the Xero marketplace. Sage offers more than 200 and MYOB is developing quickly. You can look at these apps as a threat, since many of them offer services that may lie in the traditional domain of the accountant. Think again. Does any business owner really want to have to wade through 500+ add-on options to build a business and financial architecture for their business? There is a rich opportunity here for the accounting profession to advise on how to integrate this technology into a business and offer valued-added services.
Those apps help make you look very smart.
The connected apps marketplace also allows an accountant to easily transition into business advisory. By leveraging the integrated tools, you can provide expertise built upon the enabling technology, such as business planning and forecasting, and strategic business planning and many other areas.
Engage with your clients – when and how they want to.
‘Remote accounting’ – using technology, such as video meetings, digital signing, digital data capture, and online document collaboration and transfer – has put all of these at your fingertips.
Your clients will often thank you if they can avoid travelling through congested traffic in our capital cities, or long distances if they live in rural communities. And, crucially, this enables you to create scale and efficiency in your own business, driving increased revenue.
Evidence from financial services shows that customer satisfaction through video-based engagement can be at the same level, or even higher, than traditional face-to-face meetings. Video advice and video mortgages are becoming commonplace. Put simply, video conferencing allows you to deal with your client more directly and to cover more detail than telephone or email based contacts.
If every one of your staff members saves just one hour a week through these technologies and devotes it to providing new value-added services, you could increase your revenue per staff member by more than $10,000 a year.
The ‘bionic accountant’
The financial adviser who embraces the full suite of technology at their fingertips is increasingly called the ‘bionic adviser’. It is now time to launch the ‘bionic accountant’. Technology is both disrupting the industry and offering fantastic new opportunities. It is a great time to get on board and drive your business forward.
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