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Where is the Accounting Profession Going? A Brief Check-In

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Sep 12th 2016
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Earlier this month, Karbon hosted a discussion with five industry leaders around the key trends in accounting, focusing on the biggest issues right now, and where they believe the profession is headed.

The hourlong discussion featured insights from:

  • Paul Dunn: Chairman of B1G1, TEDx speaker, and recipient of a Lifetime Service Award to the Accounting Profession
  • Joe Woodard: CEO of Woodard Companies and host of Scaling New Heights
  • Jody Padar: CEO of New Vision CPA Group, author, and speaker
  • Mark Wickersham: Author, trainer, and the United Kingdom’s leading thinker on pricing for the accountancy profession
  • Clayton Oates: Chief Solutions Officer of QA Business

The following are highlights and key takeaways from the meeting:

What are your key observations of the year in accounting so far?

Woodard: I’m seeing a reinvigoration and fresh innovation around a very important demographic of cloud technology. Most innovation we’ve seen so far has been happening in the SMB world. But software companies are now beginning to innovate in larger companies. For the practitioner, you should now turn and look at that space, too. You don’t have to be a top 100-sized firm in order to service them. You just need to get some fresh edge to your education and understand what their needs are.

Oates:A lot of people view that Australia and New Zealand are leading the charge in cloud computing. But the reality still is that 80 percent of small business, and possibly even higher in the firms, have not adopted cloud technology to a functional point as yet. So, it’s about getting ready and preparing for that next segment of the market. The connection and the ability to connect these applications is becoming more simplified and, ultimately, demystifying this whole cloud space.

Padar: From a practice management point of view, our customers are wanting these cloud solutions now. That’s been the biggest shift this year – it’s not just vendors pushing product or new-age accountants demanding better products, it’s small business and mainstream America asking for a product in the cloud, and wanting it to work. I don’t think this happened much before 2016.

Dunn: People are starting to realize and question, “Is the model that I have as an accounting firm able to embrace this speed, technology, and complete change in the way that we do things?” So, I’m seeing that technology is pushing people to rethink their models that they’ve got in a very interesting way.

Wickersham: Technology is fundamentally changing the game. And I’m seeing a sense of panic in some quarters that accountants and bookkeepers could become redundant in the future, so we absolutely have to change our models going forward. And the two fundamental changes are about adding more value to clients and changing our pricing models.

What one action should all accounting firms take right now?

Dunn: It is crucial to understand that everything is live, real-time, always on. So, the biggest action we can all take right now is to pause. Take time away from everything that is always on, work on your purpose, and move away from being partner-centric to being customer-centric. Once we understand that we really can build businesses that matter, we can move away from being dispensable in a crowded marketplace to being indispensable.

Oates: Get a learning fund and invest 10 percent of your income on learning. The reality is that you have to get out of your comfort zone, gather information, and invest in your own education. And remember that everyone is in the same situation – the profession does not have a stranglehold on this – your clients and small business owners are going through the same things we are. So, keep learning and get yourself better in ways that you can help others.

Padar: I know you’re pausing, but I think you should take one step forward, too. Everyone gets overwhelmed by the marathon and forgets to take just one step. And that step will get you to the next step, and before you know it, the change just becomes natural within your firm, and everyone starts changing.

Woodard: Stop selling accounting services. That’s not a joke! We should keep performing services, but stop selling them. We should instead be selling results. Sell based on what your efforts and your knowledge are going to produce. Clients don’t care about the effort, and they certainly don’t care how long something takes.

Wickersham: Put your prices up straight away. I know with absolute certainly that almost every accounting firm is working far too hard for too little money. The real cause of all our challenges is that we’re too cheap. The big myth is that people think their clients are price sensitive – that’s wrong, they’re value sensitive.

What one action should all accountants stop immediately?

Padar: Stop taking every client who walks in your door. Define the personas of the type of client you want to serve, and if that new client doesn’t match that persona, say no. It doesn’t have to be a hyper-niche, but you can’t say yes to everyone.

Oates: Stop thinking you own the client. Ask yourself, if we lost all our clients, would I stay in the profession in the same way that I currently am? Or would you start your firm in a different way from scratch? Get out there and deliver on the promise of making a difference in people’s lives, not least your own.

Woodard: Stop retaining the client that is dragging you down. If there is one thing you should do before now and December, stop servicing your most problematic and emotionally draining client. Fire them, and then take all of that fresh adaptive capacity and invest it in something that is specialized and not shared by more than 5 percent of your peers. Use it to increase the wealth of the clients you like.

Dunn: This one is for all the partners. If you are to be a business or a firm that matters then you have to stop recording stuff that doesn’t matter – and the stuff that doesn’t matter is time.

Wickersham: Stop giving away valuable stuff for free. If you stop doing this it will literally add tens of thousands to your bottom line. Accountants give away so much for free, usually small stuff, but that small stuff adds up.

For more insights, you can watch the discussion in full here.