Category: accounting technology

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Client Solutions, not just Professional Services

Client Solutions, not just Professional Services

Accounting Professionals serving a small business client base are struggling to find ways to demonstrate the value of the services they provide, yet many firms remain focused exclusively on their own processes and improving profitability therein rather than looking “outside the box” to see how they might involve the client in the discovery.  The obvious element which these firms are not addressing is the client user, and how a direct participation by the client becomes the foundation for internal process improvement.  After all, a lot of what accounting professionals are battling against is perceived value.  If the client were to be a more direct participant, the value of the work and the tools which support getting it done could provide a more tangible or visible aspect and increase the overall value perception of the client.

It is easy to say “get the client more involved”, but actually doing it can be the real challenge.  Professionals are recognizing this reality as they attempt to engage client users in online portals for document exchange and by providing application functionality which is supportive of the accountants’ processes.  While some professional firms are experiencing success with this approach, many other firms are not.  There are likely a variety of reasons why some firms have more success than others in getting clients to work with their online tools, but I believe there are two key elements which impact success:  accountant-centric focus, and provider lock-in.  Whether these elements work to the firms’ advantage or not depends solely upon the specifics of the service model and client market being served.

Accountant-centric focus

Most accounting professionals recognize that paperless approaches to working with client information and documents makes a lot more sense than working with the actual paper.  Particularly with the innovations in image capture, OCR and zero-entry solutions, it is logical to try to get as much of the required information transformed into useful digital data as possible.  Data entry time is reduced, accuracy is improved, and the resultant information is better and more useful and may be processed more efficiently… for the accounting professional.  For the client, on the other hand, it’s just another way to get information to the accountant (who is always wanting more information).  The value of the deliverable – the reconciled bank account, financial report, tax return or whatever – isn’t increased.   The solution often offered to the client is a solution intended to solve not the client problems, but the accountant’s.  For the client, it is difficult to see this as a “solution” to any evident problem they face.

Provider lock-in

Business software customers are often commenting about how the solutions they use don’t allow easy transition to alternative products, or add-ons are only available from developer-prescribed sources.  Vendor lock-in is a consideration and may be a barrier to doing business, because business owners want to know that they have the ability to change as business requirements change… whether it means changing software and systems, or whether it means changing professional service providers.  As more professional service providers attempt to engage their clients in technology-based approaches to doing business, clients are recognizing that these approaches may come with “strings attached”, limiting their future choices.  While it is important for the professional services firm to protect its work product, it is also important to consider the client’s position.  Part of every business relationship is trust, and that trust should not be one-sided.  Just as the professional trusts that the client will work with them in a legitimate manner, so does the client trust that their professional will not hold their information hostage if they elect to make a change or engage with other providers in the future.  Additionally, does the system provided by the accounting firm allow the client to collaborate with their own team members or other service providers, or does it address only the interactions between the accounting pro and the client?  This also represents a barrier to participation, as any given client business likely interacts with a variety of providers – many of whom are also asking that owner to implement solutions which improve their ability to do a form of e-business together.

As accounting service providers look to technology to facilitate closer and more efficient working arrangements with clients, they would do well to also consider how that technology is positioned to benefit the client as well as the professional practice.  Delivering a solution which provides clients with the capability to control information access, which allows collaboration with their various service providers, and which facilitates a lean process approach for all involved could be the right answer to the problem.  Perhaps this becomes the most important factor – client enablement – and focusing on solutions which address the clients’ information management and processing requirements as well as those of the firm.

Make Sense?

J

Read more about Data Warriors: Accountants in the Cloud

Read more about using the cloud to extend “connectedness” beyond traditional boundaries

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Accounting and Business Technologies | Joanie Mann: Salvaging Business Intelligence

The issue is that you are either a customer or you are not, meaning that companies can’t keep their old SaaS solutions around just for historic data unless they wish to continue the subscription with the SaaS application. This is of particular concern with finance and accounting applications, as they are the core of the business intelligence, and the source for tax data, compliance, etc. Keeping the financial data for long-term access is a requirement for most businesses.

via Accounting and Business Technologies | Joanie Mann: Salvaging Business Intelligence.

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Innovation and Disruption: Challenging the Professional Accountant’s Value

Innovation and Disruption: Challenging the Professional Accountant’s Value

It’s tough, being a professional accountant or bookkeeper for small businesses and it’s not getting any easier.  Yes, there have always been challenges to the relationship, particularly with the perceived value of performing the work being fairly low yet the value of the work product being quite high. But professionals are facing new competition – competition in more areas and delivered in more ways – than ever before.  This competition and the advantage it often represents is founded in the disruption of traditional IT created through cloud computing services, and the innovative use of technology, people and process to craft entirely new service models.  Accounting professionals must recognize and leverage these elements to improve client service levels and differentiate offerings, or they risk losing revenue, business value, and relevance to their clients and markets.

Accounting and finance technology has, for many years, been necessarily focused on managing the ever-increasing volume of paper-based information.  This paperwork provided the basis for financial transactions and had to be collected, translated and normalized, keyed into the system as data, and finally summarized for various reporting purposes.  It makes sense that the simple fact of “document and paper handling logistics” have resulted in a variety of approaches and computerized tools designed to deal with all that paper. The “reality of paper” is firmly entrenched in business, and has been for so long that accounting solutions and financial systems have been developed to make working with supporting documents easier, yet continue to approach the use of those documents simply as support for data entered after-the-fact.

But there are new participants in the world of small business accounting and bookkeeping, and this entirely new generation of solutions does not carry with them the weight of years of paperwork and paper-based processes.  Rather, this generation of online application solutions is developed with innovation in mind, and is seeking to develop a new approach to what are generally referred to as “best practices” for accounting for small business.  Bear in mind that the term “best practices” describes something well-known and

There are two very important aspects of these “new generation” solutions and the services they provide, and which represent the challenge to the old rules of doing business.  Based on early adoption and usage of many of these solutions, they will be successful.  How they fit into the profile of today’s accounting or bookkeeping practice remains to be fully exposed.

1.  Real-time information

It was always broke, and now we can fix it.  When most of the business and accounting information was paper based, it meant that accounting and bookkeeping would always be performed after-the-fact.  It takes time to gather the information, and even more time to organize it and turn it into useful digital data.  The new approach is not to provide a better way to manage paper or to turn it into data more quickly.  The disruptive and innovative approach introduced is the belief that information should originate as data and not as a document.

2.  Consumer-oriented service

DIY is fundamental to many of today’s small business solutions and services.  While the term Software as a Service describes how software and systems are being sold in the form of subscription services, the reality of many of these solutions is Service through Software, where the work product is the service rather than the software and systems (and people) performing it. Customers subscribe to a supporting business service, and it’s delivered through a software-based interface. The innovation delivered is the simplicity and affordability of getting the work done for the business owner, and the disruption is the further-diminished perceived value of the accounting or bookkeeping professional and the fundamental services they provide.

Accounting and bookkeeping service providers have difficult decisions to make regarding how they will address these very immediate challenges to the value of the services they provide.  Professionals who learn to understand and appropriately select and apply this new generation of technology-supported services are likely to find that the competencies they develop – which represent differentiation – serve to make them as valuable to their own enterprises as those of their clients.

Make Sense?

J

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Why Accountants and Bookkeepers Use the Cloud

When businesses do business, they generate a lot of information. In most cases, this information has a relationship to a financial transaction of some sort, like a bill from a vendor or an invoice or sales receipt for a customer. It can be difficult for a small business owner to find the best way to manage the information about customers and products and suppliers, and figuring out the best way to handle the bookkeeping and accounting is often a secondary issue. Sure, it’s important to know how much money is in the bank, but online banking helps with that. For a small business owner trying to keep their operation running, the biggest problems are the ones they face every day, like remembering which customer likes which products, or knowing which suppliers will deliver in a pinch. Bookkeeping just isn’t a huge focus other than during tax time because it doesn’t help them get business done.

It is this question of value in daily bookkeeping and accounting work that business owners and their accounting service providers alike struggle with. Certainly, most business owners recognize the necessity to get the books done, but it is generally for compliance purposes alone. Payroll taxes, sales and use taxes, personal property taxes, income taxes – these are the items that business owners think about when they think about accounting. If you see it through the eyes of the business owner, accounting = paying taxes. It’s a tough value proposition for the accountant, when you think about it. The business owner has to pay someone to figure out how much they have to pay someone else. Yeah, try to sell more of that, and good luck.

The cloud, on the other hand, is helping accounting and bookkeeping professionals change this perspective. It’s a relatively new working model for some even though the idea has been there for a long time. Better information helps business make better business decisions, and accounting professionals can help businesses implement the controls and processes which ensure that the information is complete and accurate; they can help make the information better and more meaningful.

Remotely accessed and hosted desktops and application models have been around for quite a while, too, but only recently has the market begun to realize the full potential of the hosted model. We have the investment in SaaS solutions to thank for this; they blazed the trail for online application adoption and created awareness of the possibilities around hosting and anytime/anywhere access. The SaaS and “true cloud” applications continue to gain in popularity and acceptance, yet the hosting model is providing businesses with the ability to retain use of their business applications and data yet benefit from the same managed service and remote access that other online solutions provide.

When you look at how public accountants and professional bookkeepers work with their clients, the concept of creating shared access to accounting applications and financial data makes a lot of sense. Time and distance are the real issues to be solved – the business owner and their accounting pros generally work from different locations, and likely need to access the information for different purposes at different times. If they aren’t in the same place and using the same tools, how efficient can the collaboration truly be? With the cloud, on the other hand, collaboration is fully enabled and allows each user to do what they need to regardless of the location and time.

As the accountant or bookkeeper is able to work more closely with their client (using the same tools and the same data in real time), information can be processed more regularly and with a higher degree of accuracy. Outsourced accounting and bookkeeping providers are then able to give their clients more timely and accurate financial information which supports making better business decisions all the time. Helping with the organization and processing of information as business happens, fewer gaps are found in the data and the improved controls protect against data loss or misclassification. The data becomes more useful in that it contains more details, is more accurate and complete.

For the accounting professional, the benefits are many. Not only is the professional in a better position to deliver tangible value to the client (much higher value than just a tax bill!), the value is delivered more frequently which increases the overall value perception of the service being provided. Note the word “value” is used a lot here; it is the basis for billing clients for the useful nature of services provided and not on the time it takes to provide them. Internally to the accounting or bookkeeping business, the increased efficiency introduced with real-time application and data access means that processing workflows and resources may be more streamlined and handled with a great level of efficiency, which drives improvement in profitability and the consistency of service delivery.

There are a lot of new and exciting products and services emerging: cloud application services, artificial intelligence and automation, and the Internet and Interfaces of Things.. and businesses are being encouraged to adopt these solutions for a variety of reasons. For accountants and bookkeepers working with small business clients, there is no doubt that the cloud, hosting and online collaboration are the keys to helping get more and better business done.

Joanie Mann Bunny FeetJ

Read about Hosting All My Applications in the Cloud

or more about the Collaborative Online Model for Small Business Accounting Professionals

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Hosting All My Applications in the Cloud

Many business owners will recall when their first in-house computer networks were installed.  When the PCs were networked together in an office, it made file sharing and collaboration among team members easier and more efficient.  Installing additional applications on the PC was a relatively simple process, and when the new application came with the ability to integrate with another app already on the PC, it was often a fairly simple process to get the two “talking” together.  But installing and integrating applications on your personal computer is a bit different from getting multiple applications installed and integrated with a cloud hosting service provider.

In almost all cases, integrating multiple desktop software solutions requires installing those solutions on the same computer so that they can share certain program elements or, at least, share .ini or data files.  Application integration is important because it allows different software solutions to work together, communicating data from one application to the other so the information may be used in different ways or for different purposes.

An example of this might be a Microsoft Office integration with QuickBooks, which allows the user to perform a one-click export of QB financial data to an Excel spreadsheet.  Another example is the integration between QuickBooks and Fishbowl Inventory, which synchronizes information from the Fishbowl inventory system into the QuickBooks financial software.

In nearly every case where a software program has a software-based integration with another solution, the integration must be installed in the same system as the core solution.  In the QuickBooks world, this means that the programs which integrate with QuickBooks must be installed on the same computer as QuickBooks.

In a conventional PC network, the necessity of installing the various software solutions on the same machine is not a big problem as PC software and integrations have been implemented in this manner for years.  On the other hand, when the business is considering the option of moving desktop applications to the cloud, it is important to make sure the provider and service will allow all of your products to be hosted.  In most cases, this requirement highlights the main difference between a shared service versus a dedicated or server-based solution.

With shared services, the servers are generally configured to offer a strict and limited set of applications to be hosted.  The applications on the servers are used by subscribers of the service, and users are limited to accessing only those applications available in the environment.  The shared approach is popular with some application hosting providers as it creates an economy of scale which helps providers to earn more revenue on their infrastructure.    The trade-off is that a shared hosting solution only works well for businesses with a limited application requirement, and is generally fairly expensive when more users are added to the service.

The need for diversity in hosted application choices, coupled with the need for businesses to keep costs down even as the number of business users increases, are the primary drivers for adoption of dedicated and server-based cloud hosting solutions.  When the solution is managed as an entire environment rather than on an exclusively per-user basis, an economy of scale is developed within the organizational IT infrastructure.  As the business grows and adds more users and applications, the incremental costs to bring each user or application onto the platform is often far less than a user subscription in a shared solution.

For any business planning to migrate their server and systems to the cloud, the first step is to have a thorough understanding of the applications and integrations the business needs in the host environment, and then to find a hosting provider that can deliver the infrastructure and baseline system administration required.  It is unreasonable to expect a hosting provider to be an expert with every software product available, but skilled and experienced hosting providers understand how to generally install and implement most standard business applications and will rise to meet the customer demand.

While no business can guess what their future software needs may be, decisions can be reasonably made based on the solutions currently in use.  Finding a provider with a service to meet immediate needs is useful, but businesses change and therefore business requirements change, and it is good to know that the hosting infrastructure and IT services supporting the business can adjust to those changing needs.  After all, cloud hosting of applications and data just means the servers and infrastructure are with the service provider and not in the office, but it doesn’t mean businesses can’t have the feature-rich and functional applications their businesses have come to rely on.

Make sense?

J

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What’s Motivating Small Businesses to Move to the Cloud?

When information technology professionals tell their small business clients about cloud computing, it often sounds even more complicated, risky and expensive than in-house networks and business Internet access once did.  Business owners are faced with discussions about hosted or SaaS or hybrid and ask what will I do when the Internet goes out? and how secure is it? and will it work with my iPad?… and often get one of two responses from their local IT guy:

  1. The cloud is just a way for software companies to make more money.  I can keep your IT running better in your office and save you a lot.
  2. If you move to the cloud you have to do a lot to make sure it is secure, and you won’t be able to run all your applications (but we’ll back up your data to the cloud so it’s safe).

Now, you can’t really blame the local IT guy for being a little bit wary of some cloud solution offerings because these local IT guys really are (in many cases) trying to operate with the best interest of their client in mind.  It’s just unfortunate that sometimes a lack of information causes them to revert to their comfort zone, which is selling servers and performing on-site installation and break-fix work.   What information are these folks lacking?  An understanding of the various options and capabilities available with hosting services and cloud solutions, and how the IT provider can continue to be the advocate and IT manager for their clients even as those clients move their primary information technology to the cloud.

For many years business owners have relied upon their trusted local IT professional to help them find solutions to various business problems.  Answering questions and helping procure and implement computers and networked systems, software applications, backup solutions and more, the IT professional serving a small business customer base has necessarily become the one-stop-shop for everything related to computers.  Smaller IT service companies often rely upon regular sales of server equipment and network installations to pay their bills.  It’s no wonder that these companies have a hard time accepting hosted solution models, as they see their revenue potentials dwindling as fewer servers and networks are sold to small businesses.

The interesting trend being viewed these days is that more business owners are looking beyond their IT professional to find solutions to the problems they deem as high priority for business technology: mobility and remote access.  It is not necessarily that the self-service technology model makes more sense for small businesses (businesses can still benefit tremendously by getting training and implementation support from their local IT guy), but simple and affordable cloud solutions have addressed many of the small business IT challenges that were previously big revenue streams for local IT service providers.  Savvy business owners will find solutions that work for them, and will look beyond their immediate advisors if those advisors aren’t providing the right answers.

When a small business owner talks about mobility and is looking for answers to the remote access question, they are not thinking about GoToMyPC or other remote control technologies and simply connecting to an office PC.  Small business owners today are talking about central access to information at any time from any place and with whatever computing device they happen to have available at the time.  For a small business owner, the benefit of the cloud is a largely emotional benefit – being able to stay in touch with the business at all times.  The real benefits may be improved security, simplified management of information resources and pay-as-you-go pricing for business applications, but these are often value statements which fall on deaf ears just as the cost/benefits of upgrading the server every 2 years did.

It is tempting to focus on logic and reason, discussing the tangible benefits of any business information technology model or approach rather than how it makes us “feel”.  Productivity metrics, best practices in security, total cost of ownership… these are all the right areas to pay attention to when selecting any technology solution for a business.  But really, when it comes to selecting technology for small businesses, the business owner is in the driver’s seat, and that owner wants one thing: to see what’s going on all the time.

Make Sense?

Joanie Mann Bunny FeetJ

read more about The Psychology of Small Business IT Adoption