Tag: information technology

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The Collaborative Online Model for Small Business Accounting Professionals

Accountants and bookkeepers serving small business clients are facing a growing problem – how to provide services that are valuable to the client in a way that makes it profitable for the provider.  Part of the problem is that small business, while they need quality accounting and bookkeeping services, have a hard time paying for it unless the person doing the work is sitting in the office producing tangible reports and paperwork all day long (and maybe answering the phone while they’re at it).  Accountants and bookkeepers working with a variety of small business clients can’t be profitable when they have to travel to client offices to do the work or pick up and deliver files and paperwork, and they certainly aren’t expecting to be the office receptionist while they’re there.

The solution for both is an online working model, where the outsourced professional and their client can both login together.  Each accesses the applications and data to get their work done, and is able to access when and where they need to.  Online accounting approaches help service providers increase their profitability at the same time they increase their level or range of service provided to clients.  With a collaborative online accounting model, professionals and their clients can work from anywhere at any time, giving both the freedom to focus on what needs to get done.

This doesn’t necessarily mean that the bookkeeping or accounting solution has to be an “online” service, per se.  Looking at the accounting product alone isn’t often the best way to solve the mobility and managed service problem for the client, which is really what “online” for the client is about.  The fact that their service providers (accountants, bookkeepers, etc.) can also work in the system is of secondary benefit to the client.  The worst thing an accounting pro can do is tell their client they have to switch accounting solutions just to make it easier for the accountant or bookkeeper.  It makes sense to improve that situation, but accounting/bookkeeping isn’t generally the entire IT requirement for the business client.

An online working model enables collaboration with team members and providers alike.  Reducing or eliminating the requirement for sophisticated technology solutions is the key element, providing everyone the ease-of-use and security of server-based computing.   The real benefits include centralization of business application management, protection data resources, and the ability to more fully streamline business processes.   For many businesses, the earned benefit is increasing the capacity to do business profitably simply by making the current working model much more efficient and effective.   The benefits are there for both the client is collaborators to experience, and this is where the focus should be – on the benefit to the small business.

Accounting professionals can also seamlessly increase their own opportunity and value by embracing a collaborative online working model.  Through the use of outsourced bookkeeping, payroll services and other providers, accountants can increase or expand the services they offer to clients by seamlessly incorporating them into the overall offering.  An online approach makes this possible, and can position these valuable services as the key to client business success. Working online together, professional service forms and their contractors or outsourcers can work closer than ever before, and the accounting professional is positioned to deliver far more value to the business client.

An online working model improves the profitability of the professional practice, too. The movement of information from one place to another, the restructuring of information from one form to another… these are processes that represent the cost and inefficiency in the professional accounting office.  By working online in client accounting solutions along with the client, firms can reduce or eliminate redundant and time-consuming work that is the bane of the practice. Bookkeeping, property tax compliance work, payroll, HR and benefits administration – these are areas where outsourcing may make the most sense for the practice while enabling accountants to increase the overall value of service provided.

Does your professional practice offer valuable business services like these for your clients? Profitably?

A collaborative online working model can enable your firm to deliver the range of services business clients need most while improving the bottom line for both.

Joanie Mann Bunny FeetMake Sense?

J

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Workflow is Essential in Document Driven Business

The popularity and proliferation of online applications and cloud computing solutions for business has transformed how organizations manage activities, people and resources.  The Internet-connected marketplace has introduced both opportunity and challenge for businesses of all sizes, and much of this focus has been placed on the management and control of digital documents and data.

Electronic document management has been commonly used in professional services business for many years, yet has not always been viewed as an essential technology to apply in the context of organizing and structuring the processing of the document.  As clients of these professional firms continue to generate and utilize a great deal of paper documentation and written information, firms continue their reliance upon paper files, shared drives, and other more traditional methods of organizing the work, and storing or controlling access to documents.  However, key trends in the industry are causing these approaches to be increasingly burdensome for professional service firms, including:

  • Need to support multiple offices, geographically disbursed team members, and mobile workers and devices
  • Increasing use of email as a primary tool for collaboration
  • Introduction of new risk elements accompanying new technologies
  • Increasing numbers of forms and document types coming from clients
  • Rising expectations of clients and increased market competition
  • Growing need for businesses to increase earnings and profitability with fewer resources
  • Increasing requirement for knowledge management supporting sustainability, creating the ability to retain and reuse best practices and work produced

Advances in the design and underlying technology supporting many document management solutions today have delivered great capability to firms adopting electronic document management approaches.

Benefits of implementation include the ability to create a centralized, searchable documents base which includes all client-related content, including email communications as well as documents and data files. Easy search, access, collaboration, and re-use of information are enabled, and complete audit trails may be retained. Electronic document solutions also reduce physical document storage needs, reducing costs associated with managing and storing paper files, and can better serve business disaster recovery and continuity initiatives.

While today’s electronic document management solutions may address many of the challenges involved in working with large volumes and varieties of documents and data, there are few solutions on the market which address fundamental issues relating to document processing workflows and how they are impacted by various business or data-driven events, or by the availability of people or resources to facilitate the process.

The growing problem facing businesses today is the volume and variety of information which must be organized, processed and archived. The market is sold on the idea that electronic communications and record keeping will simplify things, but the reality is proving otherwise. Businesses are hoarding information at unprecedented rates and with the ability to collect and generate increasing volumes of digital data, businesses have not simplified their information processing, they have only created a greater need.

Generating and collecting data is not the issue created, nor is ultimately the archival and storage of the information. Rather, the problem created is in organizing the work related to processing this ever-increasing volume of documents and data.

Businesses dealing with documents and transaction-based activities should not only attempt to structure workflows necessary to support the various processes, but must also seek to normalize as much as possible, developing a consistent and methodical approach to the work which results in predictable and consistently high quality service delivery.

The efficiency gained through this structuring and standardization of the work allows the professional services firm to achieve a greater level of profitability for outsourced processing engagements, which are often viewed as low-margin and low-profit activities.

Make Sense?

J

Read about Using Structured Workflow to Manage Offline Clients | Intuit Accountants News Central

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Philosophy of Process Improvement: Today’s CFO Focusing on Operations

Philosophy  of Process Improvement: Today’s CFO Focusing on Operations

There are a great many methodologies and approaches to “making businesses better” through process improvement.  From SixSigma to Continuous Process Improvement to Total Quality Management – all describe methods of measuring performance and outcomes to return intelligence oriented towards improvement.  Many of these approaches are generally applied in manufacturing businesses, because in manufacturing it’s easier to see where processes may be flawed because the process works with tangible elements.  Making corrections in a process can improve the performance of that process by reducing errors or increasing efficiency.  The truth of the matter is that every business is like a manufacturing business, and applying measurements to the various processes the business performs can reveal the secrets to improving not only process performance and product quality, but resultant profitability.

A recent article on CFO.com  titled Operations Take Center Stage, author David McCann discusses how some CFOs are improving business profitability and performance by delving deeper into operational areas of the business, and not remaining focused squarely on accounting and finance issues.

“Operations is the key to everything,” says Larry Litowitz, finance chief at SECNAP Network Security, a secure Internet-services provider. “That orientation is found most at manufacturers, but it should be at every company.”

Fiscal and financial matters are important to every business, but focusing on accounting for the end-result of business activities assumes that the work leading to the result is useful and effective.  As more attention is paid to conservation of cash, reduction of expenses, and overall profit improvement, CFOs are necessarily moving deeper into the operational aspects of the business to uncover potential not previously addressed.  In some cases, the move is more a function of self-defense and necessity than desire, as businesses increasingly compress spending on management, merging the functional roles of CIO, COO and CFO.

Increasingly, CFOs may find themselves taking on operational tasks whether they want to or not. At larger companies, the steady waning of the chief operating officer position has resulted in more operational responsibility for CFOs, recruiters say. In 2000, 47% of the 669 companies included in either the Fortune 500 or S&P 500 had COOs; in 2012, only 35% did, according to executive-recruiting firm Crist Kolder’s 2012 “Volatility Report of America’s Leading Companies.”

Some accounting professionals may believe that they don’t have the skills and experience to suggest changes in operational areas of their client businesses.  I would suggest that logic and reason are generally the prevailing factors supporting process improvement – reasoning that is often developed through simple observation.  Taking the time to understand what the business is doing at each level, and then actually observing those activities and accounting for their effectiveness and error rate, is how professionals can spend quality time in the business and uncover hidden profit potential.

Litowitz says CFOs can influence operations at a range of companies, including service-oriented businesses. “It’s really no different. The work is a set of activities,” he insists… “All these activities can be analyzed, controlled, and measured against a predetermined standard,” says Litowitz. And just as on a manufacturing floor, efficiency generates profit, justifying the CFO’s involvement.

Make Sense?

Joanie Mann Bunny FeetJ

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Helping a Small Business Customer Choose Your Solution

In a previous article entitled The Psychology of Small Business IT Adoption, I discussed Icek Ajzen’s Theory of Planned Behavior and how a number of researchers applied it to the process of small business IT adoption.  The concept, which ended up proving to be true, was that IT adoption by small businesses is a function of a number of fairly well-defined elements, and is not so much defined by specific types of businesses or the business leaders.  The elements which lead to the act of business IT adoption (as well as adoption of other services, I’ll bet) can be identified and addressed by the potential provider of the product or solution ahead of time, making the possibility of actual adoption much greater.

Knowing how your prospective customer will approach the decision-making process is important, and getting a little insight ahead of time never hurts.  Particularly when a lot of customers don’t actually reveal their thinking, it can be tough to know where to begin.  You’ve been there before – you’re making your pitch and asking questions, but are getting nothing in return.  Sometimes it’s “deer in headlights”, and they are simply overwhelmed.  Other times they’re thinking about things you’re not telling them… but they’re not letting you know you’re not telling them.  Dead air, and then a lost opportunity.

Boiling it all down to a fairly simple explanation, businesses adopt IT because there is a conscious plan to do so, and that plan is supported by a belief that the solution will do good things for the business, the solution is a recognized (if not expected) approach, and the business believes it has adequate resources and capability to effectively handle it.  It’s all about:

  • Intent,
  • the attitude towards adoption,
  • belief of expected outcomes and their value,
  • expectations and the motivation to comply with them, and
  • evaluating barriers and the adequacy of resources to overcome them.

Intent

The first and most important element is intent, a conscious plan to get or do whatever it is.  If the customer has no plan to get the item and sees no need for it, then the barrier is pretty high.  However, if the need can be created, and the customer can be driven to believe they need to get the item, then there is intent.  Now they’re looking for you and not vice versa.  Consider that the Snuggie wasn’t “something” until folks were told that blankets simply weren’t good enough any more for lounging around (they don’t have sleeves!).  Once people believed there was a problem, they pursued finding the solution.

The attitude towards adoption

Next, what’s their attitude towards getting the item?  Sometimes people go looking for things they don’t think they can actually get, and often they know they need something but don’t think the solution is even out there, so they have a jaded viewpoint from the start.  A prospect with a positive attitude and who wants to actually find a solution is far better to work with than one who has already determined that you can’t help them.  Sometimes all it takes is a good listener to help create a positive attitude and make someone willing to tell you how you can help them.

Belief of expected outcomes and their value

Now, what does the customer think they will get from the deal?  Will the solution actually solve problems or create new ones, and are the perceived problems to be solved big enough to really worry about in the first place?  Small businesses tend to be very cash conscious, wanting as much value as possible for any expenditure.   Further, most small businesses don’t let go of their cash easily and certainly not for frivolous purposes, so a successful sale is often supported by the customer’s belief that they will get a real solution and benefit – something of value which will be realized, and that is important enough to deal with sooner rather than later.

Expectations and the motivation to comply with them

It is interesting how many small businesses go shopping for products or solutions that they don’t actually intend to purchase or adopt.  Sometimes they just want to be able to say “we’re looking in to it”, even if they aren’t and don’t plan to, and sometimes they have a business requirement that they don’t want to have to meet due to cost or complexity or whatever.  Let’s say a business has customers complaining about unresponsive or bad support, and how they should have a ticketing system to help track issues better.  Maybe the customers have the right idea: maybe the business should have a ticketing system (the business provides support and ticketing systems are considered a support service industry norm).  This is the expectation.  Let’s also say the business uses a CRM solution to handle support, and they believe it handles things just as well as a separate “ticketing” solution.  Just because there is an expectation (customers want ticketing system), it doesn’t mean the business is motivated to comply (CRM does just fine).  Expectations come in many forms and from many sources – customers, vendors, employees, contractors, the government and regulatory… on and on.  Expectation and motivation to comply are both high when it comes to legal and regulatory issues, as these things can be tied directly to money and cash and risk.  In other areas, it may not be as easy to identify or address.  The best way to look at this issue is to try to understand what the business is doing now, whether the approach works or may be materially improved in servicing their business and model, and whether or not the business recognizes an immediate need to make the change.

Evaluating barriers and the adequacy of resources to overcome them

The final and perhaps most important factor in SMB adoption of IT is the simple belief that it can be done.  Done at all, I mean, not just done “affordably”.  My dad taught me that it’s not a bargain if you can’t afford it.  Now, this doesn’t mean that there aren’t times when a business needs to bite the bullet and extend itself to become better.  But any small business in this position is a tough sell, simply due to real resources and capability.  No matter how much a business may know it needs something, if it really can’t do it, or believes it can’t – it won’t.

Make sense?

J

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Accounting Professionals, You’re right – your clients don’t care about the numbers.

Accounting pros, what your clients care about is how they’re doing and if they’re on the right path.  Are you helping them understand that, or are you just the guy who works with the numbers to make sure they’re accurate?

Accounting professionals are having a hard time of it right now, with clients demanding more insight and assistance in helping to build value and profitability in their businesses, yet accounting professionals continue to be mired in the details of the numbers.  It’s like the old saying about not being able to see the forest for the trees.  You spend time in the trees, counting trees and making sure the trees are properly categorized, but are you seeing how this group of trees performs compared to others in the forest?  The analogy isn’t that far off.  You see, if there are other trees in the way, or if it doesn’t rain enough, the tree won’t grow and thrive.

This is what it’s like out in the world, where your business is just one of many.  It’s not like you can grow and thrive no matter what others are doing. If they’re bigger than you and take all the light, then you can’t grow.  If they take all the nutrients and resources, you can’t grow.  If it doesn’t rain, you can’t grow.  Somehow, some way, you have to find a way to stand above the others, get the light and the resources and the rain.  Someone in the business should be paying attention to this bigger picture, and it is often the business owner.  Their accounting professionals, on the other hand, tend to remain in the dark, below the sun, counting numbers because the owner isn’t interested in counting.  The owner is interested in growing.

Accounting is about numbers, but growing a successful business is about numbers and strategy.  Historically, the numbers tell you how the business has performed up to this point.  Adding in the elements which speak to strategy, you can then look at what your potential performance will be in the future, and then make the necessary adjustments to make sure that the potential is realized.  The accounting professional acting as a small business CFO must be prepared to help business clients look beyond the numbers to their meaning and what they say about the business today, factoring in elements relating to business strategy and market forces to reveal what they indicate about the future.

Accountants, it’s time to recognize that you are the only ones really worried about the numbers.  Business owners just want to understand what the numbers mean and what they can do about them.

Reducing costs and managing expenses and cashflow is critical, yes, but how many business owners actually know what they’ll be up against when looking for financing, or a buyer? Or do they even realize that they’re not on the path they wanted… building something valuable they can leave to the kids? Sure, the cashflow may be there, and they’re taking a healthy monthly salary… but does that really tell the entire picture or show them where they’re likely to end up? No, it doesn’t, and every accounting professional knows that truth.

While it’s true that bad accounting data turns into bad decisions really fast, it’s also true that too many accounting professionals THINK their client’s don’t care about what the numbers SAY just because they don’t care about the numbers. I would suggest that maybe small business owners care far more than their accounting professionals recognize… and they care about building value and not just accurate digits.  This is one of the reasons why KPI dashboards, dynamic reporting tools, and business valuation solutions are so popular among small business owners – they are able to have a conversation with their business data that their accountant isn’t having.

Can self-help reporting and valuation tools be useful to business owners? Well, that’s sort of like asking if trying to figure out what you’re worth (or not, as the case may be) will hurt your business.  Information is power, and every business owner wants to believe they have the power to succeed in their own hands.  Just because they’re not having this conversation with their accounting professional doesn’t mean they’re not thinking about it.  Maybe they’re just not asking and the accountant isn’t offering.

Accounting professionals, go ahead and continue to monitor KPIs and crunch the numbers and show cash flow (real cash flow, not just today’s bank balance). But if your client had 1 hour per month to actually spend working ON the business (on the forest), trying to make sure their business is heading where they originally planned to go with it, wouldn’t it be a good idea to show them where to spend that time?  Yes, it would, and adopting the use of realtime reporting and analysis tools for business clients can help do that.

Data dashboards and decision-support solutions are important tools which help business owners understand their businesses better.  Rather than viewing these tools as dangerous or competitive, accounting professionals should view financial analysis, business valuation and KPI reporting tools as something they can use to help build value in the information they develop, rather than trying to convince clients that the value IS the information and not the guidance it suggests.  The data won’t make the tree grow, it’s the guidance that feeds it.

Make Sense?

J