There’s good news and bad news for accounting practices all over the world right now. Although there is a 97.5% probability (source PwC) that traditional accounting services such as tax preparation, bookkeeping and even audit will be automated in the not too distant future, last year USA Today’s Gallop Poll found that accountants are considered the most trusted of all business professionals.
This high level of trust puts accountants in the perfect position to future proof their businesses by moving towards a “ business advisory” service model.
Many accounting practices are currently providing some level of advisory services to their clients but are yet to understand how to fully capitalise on this lucrative revenue stream. Still more are left competing on price for traditional services that are fast becoming commoditised.
Business advisory services help clients by giving them the financial and business insights they need to grow their business and at the same time bring in profitable income for accounting firms, making it a win/win for all parties.
Here are four key areas to consider when planning how to future proof your accounting practice.
1. Take The Time To Understand Your Clients Needs
Whether you are on-boarding a new client or working with an existing one, it is important to develop regular and meaningful understanding of their business needs.
Your ability to deliver valuable insights starts right here! The deeper you grasp their needs, the more relevant and valuable the services you will be able to provide them.
This is much more than merely asking them about what service they “think” they want, it’s about understanding who they are, what they desire and what’s keeping them awake at night.
2. Providing Services Your Clients Value
When asked to provide insight into how a client can increase profitability, I have too often witnessed the best a company’s tax accountant can offer is to tell them to “cut costs”. For most business owners this insight is not helpful or relevant.
To become the trusted advisor that clients come back to time and time again requires deeper understanding and high quality insights.
Assisting the client to understand how much true profit or loss they are making on each different product, service, division or customer and then helping them to interpret what that means is something that is invaluable to businesses. It enables them to make better choices about where to focus their efforts and resources so they can increase their returns.
Helping them to understand the cash flow implications of a new project, set financial and non-financial KPI’s, developing benchmarks or lead indicators are also highly valuable services.
3. Up Skilling Your Team
The skills and the mindset your team needed to deliver business advisory services are different to delivering traditional services.
Whilst some experienced partners are able to provide the quality insights and assistance business owners are looking for, many of their accountants are yet to build muscle in this area. The high workload experienced by partners often means they simply don’t have the capacity to up skill their team.
In order for accounting practices to offer these services more proactively and on a wider basis, it is imperative that their accountants are able to spot the insights in the numbers by developing their understanding of the wider topics of business, leadership, influence and communication.
4. Developing Efficiencies
Whilst there is an urgent requirement for new skills to be developed so that advisory services can be introduced, there is equally a need for accounting practices to streamline their existing traditional services delivery.
There can be large amounts of wasted time and effort in the processes accountants follow, with duplicate ticking, cross-checking and double handling of work.
If accountants are to remain profitable in the price sensitive compliance services, leaner and more efficient processes must be developed.
Now is the time for accounting practices to lean in and embrace the next phase in their service evolution, to make them stronger and more valued than ever before!
To find out how she can help your accounting practice click here.
As well as being a Chartered Management Accountant (CIMA) and ex-CFO with over 20 years experience, she has also worked extensively with small and medium sized business owners to help them grow profitable businesses.
She's also a certified coach, NLP practitioner, Metadynamics TM Consultant and contributor for Kochie’s Business Builders.
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