The changing challenges of Accounting
The accountancy landscape has changed considerably over the last fifteen years. People of a certain vintage will have experienced each and every change along the way. Such is the pace of change, that even relative newcomers to the industry will be constantly needing to adapt and relearn.
Arguably the greatest change has been the wide scale adoption of cloud accounting technology from the likes of Xero and Quickbooks. This has given accountants and their clients unparalleled access to technology that was typically the preserve of much larger organisations.
Fast forward to today and the sector continues to evolve. The rise of automation and the increasing sophistication of artificial intelligence (AI) creates both threats and new opportunities for practice owners.
We’ve spoken to a lot of people within the industry, from accountants and their clients, right through to our competitors and vendor partners. Getting consensus on the big challenges facing the sector can be tough, but a piece of analysis from Accounting Today had us nodding our head a lot.
In it, they cited five challenges for the industry, in this post we’ll focus on the top three.
- The impact of technology
- Adapting to rapid change
- The shift to advisory services
Do you agree with Accounting Today? We’d like your help in understanding the real challenges of managing a modern accounting practice. The 2-minute anonymous survey will help us help you and your industry tackle the most pressing issues.
The Impact of Technology
The rise of cloud accounting has meant an incredible rise in the number of apps for practice owners and for their clients. Each cloud accounting platform has a huge range of apps to choose from. At the time of writing, Xero alone has over 600 apps to choose from. While having a lot of choice is generally a good thing, it does make the process of making choices that bit harder.
Once you’ve selected the apps that are best to run your practice the next challenge is to make sure that they play nice together. Simply put, can they talk to each other? Can they share data so that you have a single source of truth at any given time? And, do they do this without manual intervention? It always seems a bit pointless to us if you have to export something to Excel or Google Sheets to make it work.
Even if the data is accurate there is still something else to consider. More apps mean more subscriptions to pay, more training to deliver and, ultimately, a more complex workflow to manage.
Adapting to change
When change is constant, it can feel like trying to hit a moving target. So often in life future aspirations are kept in check by current realities. This is especially the case for accounting practices. As we’ve discussed above, the pace of change in technology alone can be overwhelming. But change is much broader than that.
Depending on where you’re based, there will most likely be some new compliance based change coming your way. Then you can add the changing expectations of your clients and your own team into the mix. If you can’t match those expectations, in can be a challenge to keep your clients and your staff.
The reality is that the only way to survive change is to create the space in your practice to think, plan and implement for a more successful and sustainable future. That means being more efficient and taking back control of your practice. You can only do that by developing smarter processes and workflows.
The shift to advisory services
One of the opportunities that’s had a lot of traction is the shift of model to a more consultative approach. ‘Advisory’, as it’s labelled, is seen by many people within the accounting sector as one of the main areas of growth. Others, who are slightly more pessimistic, think that advisory is less about growth and more about survival.
While some commentators see it as the ‘holy grail’ we take a much more pragmatic view. For us, the role and opportunity of advisory will vary from practice to practice. What can’t be denied though is that it’s certainly driving some wider market and industry conversations.
From our perspective we see advisory in all its guises as a good thing. Small businesses need as much help as they can get. If their accountant can free up more of their time to spend advising clients on how to grow, or sustain a successful business, then there’s nothing but upside for both parties. Bringing it back to technology, from our perspective it would be great to see accountants being in a position to advise their clients on which apps to use.
While we operate in a different sector, we face many of the same challenges faced by the accounting industry. After all, we make our living from billable work. We help our own clients engineer new processes and back in 2016, we knew we needed to do the same. At that time it was becoming increasingly difficult for us to maintain visibility of what was happening in the business. We lacked a single version of the truth that we could rely on.
Being a tech based company, we found the tools that could help us. And that’s where we learned our most valuable lesson.
You name it, we had a tool for it. We kept on finding brilliant tools, some small, some large – all that served a unique purpose in helping us manage all aspects of the business. The problem was that they didn’t necessarily play well with each other. We were creative and could use tools like Zapier to force an integration of sorts, but it all felt a bit clunky.
The lesson we learned was to create a shorter, more manageable stack. In other words, less tools, not more. That led us to discover the term ‘Service Operations’ and, just as importantly, that’s when we were introduced to Accelo.
Accelo is the service operations platform that we use to manage every aspect of our operation. It’s been a game changer for us, and we believe that it’s the most complete practice management tool for accountants, large and small.
It’s by no means a silver bullet, there’s work to be done to develop your processes, workflows and logic, but once that’s done, there’s no question that it can help your practice thrive. Specifically, many of the challenges we’ve been hearing about from accounting practice owners can be addressed by taking a service operations approach. We have been working on this with some practices already in 2019, and you’ll be hearing a lot more of this as we roll into conference season with QuickBooks Connect and Xerocon both in Australia.
What’s your biggest practice challenge?
Although there seems to be a level of consensus of the challenges of operating a modern practice, we’re keen to get your perspective.
If you have two-minutes we’d be grateful if you could complete our short, anonymous survey. The information will help us understand the real challenges you face. Knowing that will help us to develop better solutions for you and practice owners and managers just like you.
And, if you have any questions about practice management software or how we use Accelo in our business head over here and ask away.