In a recent article with the International Accounting Bulletin PrimeGlobal CEO Stephen Heathcote discussed the various lessons learned from digital investments made by member firms, and the growing number of opportunities available in the technology space.
Digital transformation has had an incredible impact on all aspects of our lives, both in business and in our day-to-day living.
More than ever before, accounting firms need help to navigate digital choices which, at a minimum, will keep the profession relevant and in the business for the long term. And for us, it goes beyond that, as we aim to enable firms to thrive by making the right choices in the time of rapid digital transformation.
Enabling the profession to embrace digital and use it to create business growth benefits all of us. Our collective ambition should go beyond avoiding extinction or just evolving current practices and firms.
We need to enable the profession to be the leaders in harnessing the power of data for business growth and creating a trusted safe digital landscape.
Different practices face different choices, which can often seem overwhelming as the pace of change is fast and uncertain. What we often fail to acknowledge is that the pace will never be this slow again! It is therefore not surprising that in our recent global member survey, two-thirds of our firms rank technology as the top area where they want more support and advice to make the right choices.
And our firms are not alone. As one of the most diverse associations globally, we want our firms to learn from each other as we are aware there is no ‘one size fits all’ solution, and technology choices must align to the strategy and strengths of the individual firms.
At PrimeGlobal, we are launching a campaign to draw on the learning across our firms, to enable our firms to embrace change and make the right choices for them. Of course, we want our firms to avoid extinction, but we have far more ambition than that – we want them to evolve services and enable new offerings which see them prosper for years to come.
Our firms are making choices around these major areas:
- Move to the cloud. To avoid extinction, this is a must. Organisations can now receive services in a cloud that they used to turn to our firms to provide. Our firms need to embrace cloud solutions, using them to provide added value to their clients;
- Automate. Embrace the bots! They can create massive efficiency, regardless of the size of the firm;
- Unlock the potential of client data. Our firms have massive knowledge about their clients. Using predictive tools generates insights which drive growth;
- Protect clients. Our firms have a critical role to play in regard to cybersecurity, and
- Adopt artificial intelligence. Our firms need to be ready to turn data into intelligence. This means understanding the potential of AI.
What Is The Biggest Challenge?
I have spoken to many of our member firms about the challenges of digital transformation. The biggest challenge I hear is deciding about when and how to change.
Software development is changing at an incredible pace. Our firms’ experience is that products are often taken to market before they are fully ready. During the sales pitch, it appears that the product can do everything needed; then the reality can be very different, with firms occasionally discovering big gaps in software functionality or even feeling they are being used as test pilots. Firms want to be leading the way for their clients, but fear being at the bleeding edge of change.
Therefore, our firms often face a dilemma. Do they wait until tried and tested offerings are available? However, wait too long and they run the risk of extinction. For example, for practices that have not embraced the move to the cloud, the gap between them and firms that have is so big that it may now be too hard to compete.
If rivals are doing it better and it looks more ‘high-tech’, you will be left behind.
Go too soon, and they may face significant pain, which could be costly to their business. Therefore, it is so important to learn from other firms. What have they tried? What worked? What did not? What would they do differently?
Best should never be the enemy of the good. Taking steps – however small – will help maintain relevance and ensure the practice is better able to evolve.
As with any decision in life, it is easier to be bold, if you can hear from others who have taken the first steps and how they made it work. My job at PrimeGlobal is to ensure the knowledge and connections are there to give our firms the confidence they need. As Voltaire said: “Is there anyone so wise as to learn by the experience of others?” This is what we can learn from our member firms.
What Are Our Firms Doing?
The most important priority is to develop a digital strategy. Firms needs to consider where they want to get to – what service they want to offer and who will be their customers now and in the future. Digital is an enabler, and being focused means being effective.
Many of our members are taking steps to embrace digital transformation, including:
- Moving services to the cloud, creating more time to provide added value advice to clients. Tax authorities’ move to digital platforms has really accelerated this globally;
- Automating processes regardless of the size of firm. The journey can start small, with small areas of automation, such as invoice processing or automatic bank feeds.
- This change can be relatively evolutionary, making current processes more efficient. As Hurst (one of our UK member firms) notes, automation of a single process that saves one hour a week is the equivalent of creating an extra week’s capacity over the course of the year. The impact of saving two or three people over five hours a week really adds up;
- Developing bots over a wide range of areas: billing rate adjustments, cash receipt processing, onboarding, fraud checks, service fee processing, payroll and validation of records and files;
- Firms have often concluded that evolution is not enough. DVDs evolved to Blu-rays, but that was not enough for them not to be replaced by on-demand streaming services. As part of automation, many firms are redeveloping processes from scratch;
- Working with others. Firms often recognise that they do now have the capacity to support their clients with all the services they need. They often work in partnership with other firms who may have developed the digital capability their client is seeking – for example, partnering with another member firm that specialises in cybersecurity services;
- Working with software providers to test products and services can provide opportunities. Some of our member firms are helping software providers develop their product by practically using them as they are developed. This has several advantages: it can create commercial opportunity when negotiating contracts with the provider, but also it means the product is shaped in a way that provides the firm with the functionality it wants;
- Developing or licensing bots to help clients take unstructured data and turn it into useful analysis;
- Creating predictive dashboards for clients to provide insights based on real evidence;
- Launching data analytics practices with the aim to develop as major service lines;
- Reducing cybersecurity risk. Some member firms use predictive software to help stop ransom attacks, while others may provide best practice advice so basic precautions are taken. Other firms offer highly developed forensic technology services;
- Using AI to identify risk within data sets or audit samples. Some of our larger firms have worked together to develop technology to help with audits, and
- Employing digital natives. Firms are targeting recruitment to ensure their teams have the capability needed for the future.
What Are We Doing To Promote Digital Transformation?
PrimeGlobal as an association will transform as well. We are using data to connect firms with those who have knowledge and experience to help them transform.
We are bringing firms together, to help them understand their major needs and then provide targeted support, including facilitating peer-to-peer engagement sessions when firms can share practices and ask questions to learn from others’ experience. Firms are also able to connect with each other through our peer request system.
We have created Special Interest Groups to increase learning opportunities and bring people together across borders in regular webinars. We are blending technology into our events, so member firms can find those who might help them more easily and continue the connections after the conferences. We have launched a data analytics bootcamp to help firms develop a roadmap to offer data analytic services to our firms’ clients.
To enable the transformation, collaboration is critical, and we are therefore partnering in new ways. We are working with software providers as partners, not just to obtain discounts for members, but to look at how we can practically help our firms release the full potential from their products and create the next generation of services.
We are also launching a Thought Leadership campaign focused on digital transformation, so we can put a spotlight on the best and emerging practices, and share them with firms wherever they are in the world.
What Can We Do Together?
As the profession evolves in the field of digital, we need to work together to enable the profession to be leaders in harnessing the power of data for business growth. This is a huge opportunity that goes far beyond PrimeGlobal or any other association or network. Collaboration, sharing and openness create innovation and can help us all be better equipped to embrace this opportunity to shape the profession for a new era.
Finally, I welcome the market’s thoughts on ways in which we can collaborate to ensure that this is an era of enablement for the profession.