Today's Technology for Tomorrow's Firm.
Issue link: https://cpapracticeadvisor.epubxp.com/i/432767
December 2014 • www.CPAPracticeAdvisor.com 31 FROM THE TRENCHES the use of tablets, but that doesn't mea n d isr upt ion ca n't occ u r on a moment's notice. A nother example w o u l d b e t h e l u l l i n l a p t o p a n d desktop sales volumes. There have been minimal compelling reasons to upg rade in the last 4 -5 years. T he same is true for most technologies. So, pa r t of t he cha l lenge is t hat t h e r e a r e n e w a p p l i c a t i o n s a n d developments that occur all the time. Each one by itself might not be useful or efective, but when taken together with many other developments and applications, these can be assembled into a solution and client ofering. For e x a mple, i ne x pen sive h ig h speed communications, plus a web browser, plus bigger, faster servers, plus virtu- a l i z at ion, plu s h ig h per for ma nce storage area networks, plus databases, plus applications that take advantage of all of technologies equals Sofware as a Service oferings from vendors, a n d a c o l l a b o r a t i v e a c c o u n t i n g ofering from your frm. Some authors are observing that we are in the middle of a third industrial re volut ion a nd e x per ienc i ng t he efects of radical change. Tese disrup- tive changes afect labor and produc- tivity, forcing jobs and tasks that used t o e x i s t t o n o l o n g e r e x i s t . F o r example, bank downloads are making data entry less common eliminating t he data ent r y job. W h i le we saw produc t i v it y ga i n s of 2 5 perc ent between 1996 and 2004, the failure of technology recently to produce more productiv it y gains is k now n as the Solow paradox. Tis has been writen about in academic journals and the popular press alike. So the question becomes, what is afecting your clients and your frm? How fast is this hap- pening? Can you build a list of these issues? We think it is mandator y to create a new future for you and your clients. For example, some client facing issues could include: • Low cost competitors are entering the market • A business that used to be local or regional is now national or inter- national • Cost of entry to the business is low • Techniques are available that eliminate all or part of the value add of the business • Talent to perform the work doesn't seem to be available • Lack of internal controls • Inconsistent or broken processes • Lack of marketing expertise to leverage new media How about for your f irm? W hat does your list look like? Tink about talent assessments, SWOT analysis, Ben Frank lin lists and other tech- niques you have used for planning in the past. Some frm based issues could include: • Talent shortages • Expertise shortages from losing people to retirement • Training needs including a lack of technology knowledge or business management expertise • Desire to stay small, but econo- mies of scale are needed to contain costs or obtain advanced tools • Complexity is increasing, making some oferings unfeasible or not economically viable • Lean Six Sigma could be used to improve processes • Entering commodity businesses makes the frm compete with lower cost, lower expertise groups • Certain business oferings create a confict of interest Fi n a l l y, w h at tec h nolog ie s a re providing an opportunity or need to be eliminated? Some examples here include: • Use of mobile technology • Bring Your Own Device • Collaborative accounting • Simplifed payroll • Forensic accounting • Workfow • Big data used for trend analysis • Financial reporting and business analytics T hese lists are not "the lists" to work from, but a starting point for you to create your ow n lists. Once you have a good vision of the needs and opportunities, then you can put these in combination to build a new frm ofering. For example, you determine that your team has prety good workfow expertise because you have completed a Lean Six Sigma analysis of your frm's processes. Further, you note that many of your clients have having procedural issues where a change could result in improvements in both client service and proftability. As a single engage - ment, or as an on-going advisory role as an outsourced CFO, you determine t h at you h ave t he s k i l l s to appl y work fow and fnancial reporting to your client's processes and can mea- sure these on a regular basis with Key Pe r f or m a nc e I nd ic at or s (K PI s). Eventually, you can fnd new business opportunities for the client by applying big data trend analysis. A small frm with the right expertise can become a deeply engaged advisor with clients using these techniques. Te engage- ments can be enormously proftable a nd rewa rd i ng , t y pica l ly w it hout deadline pressures. An Interesting Result C ho o s i n g s e r v ic e s t h a t y o u c a n efectively prov ide w ith your team gives you a competitive diferential f o r y o u r c l i e n t s . I n m o s t c a s e s , choosing a service that allows you to perform the new services plus tradi- tional compliance ser v ices ties the client to you more tightly. Further, you are prov iding greater va lue in areas that mater to the client most. T he prof itabi l it y, ease of r u n n i ng t hei r busi ness, a nd g row i ng t hei r business are all of high value to them, and should be a satisf ying use of your accounting skills. A nd yes, you can still do audit and ta x compl ia nce work i f t hat is t he most interesting, as long as others in t he f i r m a re prov id i ng ad v a nced b u s i n e s s a d v i s o r y s e r v i c e s . B u t wouldn't it be great to have to fgure out how to minimize the taxes from a wildly successful client rather than f ig ur ing out how to ra mp it dow n because of a failure that could have been avoided? If you take the right actions and create the right of ferings, you can create a future for both you and your client that is interesting, proftable and rewarding. IN MOST CASES, CHOOSING A SERVICE THAT ALLOWS YOU TO PERFORM THE NEW SERVICES PLUS TRADITIONAL COMPLIANCE SERVICES TIES THE CLIENT TO YOU MORE TIGHTLY.