Introduction
The accounting industry continues to undergo a seismic shift, driven by rapid technological advancements in the last decade and changing client expectations. At the forefront of that transformation was Hamish Edwards, Co-Founder of Xero, Chartered Accountant and serial entrepreneur. By now, we’re well aware of how it changed the general ledger for good and also transformed how small business accountants interact with their clients. Whilst Xero remains a New Zealand success story, Hamish doesn’t think the accounting industry is anywhere near done with technology and automation.
Now Connectworks’ Executive Chairman, he’s ready to see another part of the accounting ecosystem evolve to empower accountants to do more.
I recently had the joy of chatting with Hamish to pick his brain on where he sees things heading. In this article, we discuss how accounting firms can navigate the ongoing tech transformation, and where he believes accounting firms should be focusing to stay ahead of the curve and ensure long-term success.
Embrace the cloud
It might feel obvious, but cloud-based solutions have become a game-changer for the accounting industry. The rise of cloud-based accounting began happening in the early 2000s and since then it’s grown exponentially. In the ‘Accounting Software’ category alone on softwareadvice.co.nz there are 432 products listed, that doesn’t take into account adjacent categories such as practice management, document management, onboarding and engagement, ERP systems, compliance and regulatory tools for AML, CDD and the like.
What the cloud has enabled is for accounting firms to spend more time on other value-added services, as opposed to being bogged down in administrative, paper-based forms and documents.
Hamish believes,
The cloud has become the new normal, and accounting firms must embrace it to remain competitive. By adopting cloud technology, accounting firms can enjoy numerous benefits, such as real-time access to financial data, improved collaboration with clients and team members, and enhanced security. Cloud adoption also enables firms to scale their operations more efficiently and offer clients an improved overall experience.
Invest in automation
One common theme during our conversation was how much Hamish believes the modern-day accountant is more than just a numbers person, in fact in most cases they can play the role of Chief Financial Officer (CFO) for the companies they work with, being a much more strategic partner in your companies success as opposed to just making sure you pay your taxes each year.
And one way to free up time to do that is with automation.
Automation is reshaping the way accounting professionals work, unlocking new efficiencies and enabling firms to scale their operations. The value of automation, whether that’s built into the tools themselves, or using tech solutions such as Zapier to build spreadsheet automation, it’s a must.
Hamish says,
Automation is the key to unlocking efficiency and scalability in accounting firms.
Routine tasks such as data entry, invoice processing, and bank reconciliations can all be done with automation these days, and accounting professionals should be striving to reduce the amount of human time spent on these repetitive and manual tasks so time can freed up to focus on more strategic, value-added services for their clients.
Stay up to date with emerging trends
Cliche? Perhaps. The point is though that as with any rapidly evolving landscape or industry you can either lean into the disruption or stay with the norm. Both approaches are justified, but if you want to unlock new opportunities and be the modern-day accountant, Hamish reckons this is so important.
What Hamish thinks,
Stay ahead of industry changes by upskilling and training your staff in emerging technologies and best practices.
I am going to jump on what seems to be the most popular trend right now as an example; Chat GPT. Whilst we might think we’re all doomed, the reality is that as with the emergence of the cloud which helped make things easier for us, generative AI can also do the same with time, we just need to learn to embrace it, upskill and find creative ways to use it.
We’ve been teasing some ways you can use it, so perhaps give these prompts* a try ⬇️
Writing a newsletter to your clients
Prompt: “Write an informative monthly newsletter for [your firm] clients explaining the latest accounting industry trends, important upcoming tax and filing dates and a book recommendation from the team”
Get a quick view of key dates for your clients
Prompt: “Create in a table format a list of the key tax and filing dates, plus due dates for the remainder of the financial year.”
Other applications could include summarising complex topics for your clients, whether that be tax law or something else.
*we did some road testing on these prompts and whilst we know the outputs aren’t perfect, we’re simply trying to illustrate how upskilling, training and embracing emerging technologies could be a game changer for your firm so you can focus on delivering exceptional services to your clients.
Focus on advisory services
Play the role of Virtual CFO is one thing Hamish believes is the future,
There is increasing demand for Virtual CFO services, as businesses of all sizes are seeking strategic financial guidance without the need to hire a full-time, in-house CFO. Accountants are in a unique position to fill this gap, leveraging their expertise in financial management, reporting, and analysis to provide clients with valuable ways to grow and structure their businesses.
Hamish is challenging accountants to move beyond traditional compliance and bookkeeping tasks and position themselves as strategic partners who can help clients with financial planning, cash flow management, risk assessment, and strategic decision-making. And as we’ve already touched on, with the plethora of automation and cloud-based solutions, there is no better time to begin focusing on higher-value activities as a firm, as technology takes care of the compliance work, accountants can become true business partners, providing strategic advice to their clients.
By adopting the role of a Virtual CFO, accountants can focus on delivering strategic advice and support, driving significant value for their clients and differentiating themselves in the market.
Adapt to remote work
I think we can all agree this isn’t necessarily new, and a number of industries, where arguably it is easier, such as SaaS, have sprinted ahead and in some cases become “remote by default” companies.
But as people's expectations change, businesses morph, and remote work is here to stay, accounting firms are not an exception to the rule. Whilst a traditional, in-person heavy industry, accounting firms who invest in the right tools and technology to support remote collaboration and communication will win – you’ll be able to offer the best of both worlds to your clients.
Hamish says,
Embrace remote work by investing in the right tools and technologies to ensure seamless collaboration and communication.
So what could this look like I hear you ask?
Simply using a meeting scheduling tool such as Calendly, which works with remote conferencing tools like Zoom or Google Meet to hold client meetings, onboarding interviews and training sessions is one way you can be ready for the tech-savvy client.
Or even digital whiteboarding tools such as Miro could be used for client reviews or business planning – it might not be an ‘out of the box’ application but it certainly has the functionality to be able to create a collaborative workspace that you and your clients can access any time.
To wrap-up
And that’s that. Five key insights to help accounting firms looking to thrive in today's rapidly changing industry landscape. To recap what we touched on during our conversation with Hamish, his top recommendation are:
- embrace cloud-based solutions,
- invest in automation,
- upskill staff in the latest and emerging trends,
- focus on client relationships and offering advisory services,
- adapt to remote work (and technologies),
If you think there is anything missing, we’d love to hear from you on what you think accounting firms need to do to position themselves for long-term success.
And if you’d like to stay up to date with more valuable insights like these, stay connected with the Connectworks blog by subscribing to our monthly newsletter.
