Challenges to the Professional Accountant’s Value
Anytime, Anywhere
Being an accounting or bookkeeping service provider to small businesses today is tougher than it ever has been before. Sure, there have always been challenges, but today’s accounting and bookkeeping professionals are facing real competition in more areas and in more ways than ever before. To a large degree, much of this “competitive advantage” is founded in the innovation and use of technology supporting the business.
Unless today’s accounting professionals recognize and leverage these innovations to improve client service levels and differentiate offerings, they risk not only loss of relevance, but loss of revenue and business value.
For many years, technology in finance and accounting was necessarily focused on documents; managing the ever-increasing volume of paper-based information. This information provided the basis for financial transaction information and had to be collected, information translated and re-entered as data, and summarized for reporting. The simple fact of the logistical requirements of handling all that paper resulted in a wide variety of approaches and, ultimately, in technology-based tools to designed to make the paper easier to deal with.
The “reality of paper” was so firmly entrenched in business life for so long that accounting and other financial systems continued to focus on enabling better workflows for documents, and resigned themselves to being an after-the-fact recipient of business information.
While many existing accounting and finance solution developers continued to focus on being more effective post-facto reporting tools and facilitating paper-based processes, an entirely new generation of solutions emerged. This new generation of solutions and services has two very important elements available to them which are and will continue to challenge the old rules of doing business. And they will be successful.
I. It was always broke, and now we can fix it. The fact that most business and accounting information was paper-based meant accounting would always be “after the fact”. It takes time to obtain the document and more time to transform the information to data. The “new” generation of solutions believes that information should originate as data, and not as a document.
Information is data, and businesses can collect an awful lot of it simply by doing what they do for the business, and using intelligently-applied software and services to support those activities. Paper isn’t necessary in so many cases, allowing real time data capture to occur.
Consider the case where a small business owner operates a web store where customers can purchase products online. Using software and services readily available today, the business owner can build this capability in minutes, simply and affordably. The impact to the business is a paper-free ability to interact with customers, record sales, receive payments, and inform fulfillment – all in real time. Each and every element of these transactions is financially relevant, and the data is immediately available for direct import or integration into the financial reporting system. There are also a number of new solutions available on the market which can gather activity data from 3rd parties, such as vendor/suppliers, financial institutions, and others, eliminating the effects of time and distance and turning information into useful data.
By providing comprehensive business process support, and through the enabling of real time communication of business data, accounting and finance can become much more than simply the final dumping ground for business financial data. It can become an integral participant in providing the necessary actionable intelligence and decision support needed TODAY.
II. The new tools available to professionals are also being introduced directly to the consumer. This diminishes the perceived value of the professional and fundamental, mechanical, services they provide.
Today’s “Do It Yourself” is Service through Software. It’s kind of the same thing as “software as a service”, which is a model where you subscribe to your software and computing resources together rather than buying and installing them in the traditional manner. Service through Software is where you subscribe to a supporting business service, and it’s delivered through a software-based interface. These services can deliver highly valuable front- and back-office supporting functions, and quite a lot of specific operational support. They enable the business without requiring a specific in-house capability. This form of technology-assisted outsourcing can deliver much more than simply labor arbitrage. It can deliver process support along with best practices in implementation and use, which could extend far beyond the reasonable ability of the business personnel alone.
Online payroll services, where processed payrolls and tax reports become the result of personnel-entered online timesheets are an example of a “service through software” approach. A few other examples of this approach include online customer billing solutions, merchant services and payment processing, online bill pay, and online personal tax preparation.
Where small business do-it-yourself tools once assured that the user would ultimately seek professional help, that’s not the case any longer. The DIY services ARE professional help, and in many cases are the tools the pros use, too.
Accounting and bookkeeping service providers have difficult decisions to make regarding how they will address these very immediate challenges to their value. I would suggest that the professionals who learn to understand and appropriately select and apply this new generation of technology-supported service will find that their competency, which differentiates them, makes them as valuable to their own enterprises as those of their clients.
Make Sense?
J
