I’ve seen a lot of articles lately (and written more than a few myself) directed towards accounting professionals and “taking your practice online” or “taking your practice to the cloud”. At this point, when a professional asks me the question “should I take my practice to the cloud”, my response generally comes in the form of two return questions.
The first is “what leads you to believe you have a choice?”
The second is “what makes you think you haven’t already?”
There are a few realities about doing business today that can’t be ignored and cloud computing is at the top of the list. Professionals can recognize these realities and work with them or fight the changing tide and lose out to more relevant providers.
To address the question of choice, let’s consider the fact that many of today’s entrepreneurs and small business owners have been exposed to Internet services and online technologies for quite a long time. Use of these services has become an ingrained element in daily life. Not using online technologies seems “old school” to these folks and is often perceived to be due to some deficiency in the ability to understand or use new tools. If professional service providers aren’t able to leverage online tools to provide the access, collaboration, and higher level of service which business owners demand, they won’t work with those business owners for very long.
In addressing the “what makes you think you aren’t already?” question, let’s consider the fact that almost all of the accounting software offered today has incorporated cloud-service or Internet-based functionality in some manner. Even the tried and true desktop editions of QuickBooks financial software have quite a lot of web service functionality designed in to the product. Where credit card processing was once an offline (or telephonic) process, it’s now an instantaneous service delivered via the net. Payroll? Tax tables aren’t just downloaded to the software where you perform the processing and calculations. Payroll is a service, delivered via Internet connectivity to Intuit’s payroll service bureaus (or ADP, Paychex, etc.). Even banking is less traveling to the establishment and more Internet access and data exchange. We don’t think twice about downloading transactions from the bank computers instead of working from the paper bank statement.
Internet/web/cloud service and functionality has become a pervasive element to almost every aspect of software and computerized business support systems, and it’s a pretty good bet that your firm is already using it. So, let’s not spend our time asking a silly question about whether or not it makes sense to “take the practice to the cloud”. The obvious answer is yes.
Accounting and Finance Professionals: Cloud and Digital are Driving Change in Professional Practice
Accountants and financial consultants working in public practice are experiencing a revolutionary change, evolving from documents and paper-based processes with after-the-fact reporting to real-time business management and providing services which support daily decision-making. The underlying cause for this evolution in business accounting is the technology: cloud and collaborative computing models are enabling much closer and regular interaction between accounting professionals and the businesses they serve. Even more, technology is taking its proper place in automating once tedious activities, allowing professionals to focus on causes and results rather than on transactions.
What is the real impact this is having on the accounting profession? It’s forcing a new focus and attention on change management within the practice, and is causing professionals to recognize the requirement for standardization of processes and development of controls which are the foundations for creating sustainability in a business. The goal now is placing reliance on process rather than people, which establishes the basis for intelligent automation. Standardization of processes does not require that the firm lose its personality. Rather, the mission at hand is to imbue the organization with its unique flavor and approach and to use process automation to develop and support consistency in the functions performed.
While cloud computing models allow accounting and finance professionals to work closer with their business clients, it is important that the practice look at those client interactions and develop standards for processes supporting frequently performed functions. These operations generally represent the activities within the firm which generate the highest levels of profitability due to the consistency in approach and repetition of tasks, and are the activities to apply intelligent automation to first. Those activities or engagements which represent the “one-offs” are often the most costly for the firm to perform, and therefore may not be the most profitable of activities and are certainly the most challenging to support with any significant level of automation. It is in this area where AI will find useful value in the practice, where a more informed answer than simple process automation is required.
The surprising finding when looking at many professional practices with more than one partner/professional involved is that these firms often fail to develop even the most basic of standard processes which apply throughout the firm. Rather, each partner or professional has “their way” of handling things, which challenges the supporting personnel as they try to deal with multiple working methods. The result is a lack of consistency in the service delivery to the clientele and reduced productivity and profitability for the firm.
The thing that these firms are failing to recognize – the light bulb over their heads that just isn’t lighting up – is that cloud computing and collaborative working models aren’t designed just to enable and facilitate a closer working relationship with clients. They’re also able to be applied inside the professional practice, enabling a more productive and efficient workflow which addresses the strengths and capabilities of the entire organization. And it doesn’t stop there. Businesses are relying upon their accounting professionals to provide guidance and develop controls and standards to support the client transformation from paper-based to digital operations, and embracing the entire realm of data and interactions associating with the business. Digital transformation in a client business demands transformation in those firms who serve it.
As professionals learn to go deeper in client operations they would do well to look internally, too, exploring how increased attention to process automation and consideration for the firm’s own “digital transformation” might lead to great profitability through market differentiation and improved performance.