Culture Shock in the Accounting Industry
Every day we’re hearing about new technologies, changes, and disruptions happening to every industry in the world. The accounting industry is not safe from this culture shock and we’re constantly seeing things that will change the way our firms do business. Below is a brief overview of some of the biggest things that are disrupting the accounting industry and a small glimpse into what they truly mean for us.
Artificial Intelligence (AI) is doing a great job of evoking fear throughout our firms. Will my job become obsolete? Will the accounting industry be diminished? According to Accounting Today, robotics is expected to eliminate 40% of basic accounting work by 2020 which opens up more time for CPAs to focus on value-added activities for their clients. AI doesn’t mean that we’re going to have walking and talking robots come in and do work for us, but instead encompasses things like machine learning and automation, allowing us to analyze and understand large quantities of data quicker than humans alone can. AI may seem like a scary concept to some but when you begin to understand that it is here to help us, then we can begin to focus on the bigger wants and needs that our clients are asking for and spend less time inputting data into spreadsheets.
The shift from Accountants to Advisors
It is no surprise that the advisory shift makes this list. We’ve consistently seen a much higher demand of clients truly wanting an advisor and a business partner, not just someone to do their taxes or audit. Firms are becoming fluent in what that truly means and starting to heavily focus their practices on advisory services, including technology, succession planning, CFO services, Blockchain, and more. The move upstream to an advisory practice positions CPAs to become better relationship and business partners with our clients and ensures that we stay top of mind for any question or issue they may have about their business.
With the growth of big data and the need to see patterns and trends with that data, clients are relying on their advisors to have and understand the tools that can help them analyze their business and uncover hidden trends and information. The need for accounting firms to have Data Analytics staff on hand is rising. As clients want better connectivity and more insights from their data, we need to work towards being able to provide them with these insights and add value to their business and decisions through data analytics.
While most of us are still trying to wrap our heads around what Blockchain is, it is continuing to grow and shape the future of the profession. In the simplest sense, Accounting Today explains Blockchain to be a new type of accounting ledger that can be continuously updated and verified without the threat of being altered or corrupted. Whether it is changing our business models or affecting our clients, Blockchain will be here before we know it. The Big Four are already putting this technology to use in their businesses and it’s up to us to continue to research and learn about this technology before it becomes an industry standard.
Clients are used to having most services provided on a customized and specialized basis and now have the upper hand in price negotiations, especially when it comes to accounting. A value-based pricing system allows us to communicate pricing with our clients before the project begins and lets our clients pay for the services that they perceive have the most value. The benefits of this pricing strategy include no more invoice shock, better client engagement, and better employee engagement. While this trend is taking shape with larger firms right now, smaller firms can have an upper hand over their competitors by offering a more transparent, value-based fee structure.
These changes are quickly approaching, and as marketers, we can strive to be the ones leading our firms away from old traditions and beginning to look towards the future. It is up to us to push ourselves to be industry leaders and stay ahead of the game when it comes to ever-changing technology, people, and industry-standards.
AAM Minute: Beginner’s Guide
By Lindsay Kraus, Anders CPAs + Advisors
About Lindsay Kraus
Welcome to CPA Growth Trends — your source for information, insights, tools and best practices to drive growth within an accounting firm.
with Danielle Reynolds, Business Development, Manager with Whitley Penn
A business developer’s day involves a myriad of activities from external meetings with business owners and referral partners to scoping calls for initial client connections.