Reprinted with permission from Next-Level Accountants: Your guide to growing a firm of trusted advisors.
Are you a taxi driver in a world being disrupted by Uber?
If you still rely on desktop solutions, you may be, according to technology guru Doug Sleeter, one of Accounting Today’s Top 100 Most Influential People in Accounting. Accounting firms with an aversion to technology and innovation could get left in the dust—in much the same way as many taxi drivers who have taken a hit from Uber’s surging popularity.
“You can be relatively ignorant of technology solutions today, but you cannot afford to be for long,” says Sleeter, founder of The Sleeter Group, now known as the Accountex Network after it was acquired by Diversified Communications in 2015. “Agility trumps ability. I don’t care how good you are at every tax, finance or auditing question; if that’s all you do, the world’s going to pass you by, just like Uber passed by the taxi driver.”
Sleeter says that being a trusted advisor is all about being proactive and strategic with clients—helping them understand financial data that’s as close to real-time as possible in order to plan for a successful future. Research shows that clients hire outside accounting firms for their expertise, but they also desire accountants who are proactive rather than reactive about providing strategic advice. Increasingly, Sleeter says, that proactive, strategic advice is tied to technology clients should be using—especially cloud-based and mobile technology.
For example, more than half of small and medium-sized business owners who currently engage a CPA want technology recommendations from their accountant, and more than three-quarters of the owners who plan to engage a CPA want technology recommendations from their accountant, according to The Sleeter Group’s 2014 survey.
But accountants who have focused their professional development efforts on staying abreast of compliance-related professional standards and regulatory changes may not be entirely comfortable recommending technology solutions or helping clients plan and implement tech changes. And even if they are, clients may assume your firm isn’t prepared to help. Indeed, only 13 percent of business owners in the Sleeter survey consider their accountant to be ahead of the technology curve.
“The pace at which small businesses are using cloud technology is increasing, and I think it is increasingly way faster than the pace at which accountants are embracing it,” says Sleeter, who founded the leading independent accounting technology expo and conference, Sleetercon (now called Accountex). Adoption of technology in your own firm doesn’t solely affect your practice’s operations and efficiency. Sleeter suspects there is a growing distance between what the accountant thinks clients want and what they actually want—a gap that points to opportunity for accountants bucking the trend.
Accountants who take a deep dive into what their clients want will be able to retain clients and grow revenue for their firms. How do you do this? How can you ramp up your technology know-how in order to meet your clients’ needs and become that trusted advisor? Sleeter has this advice:
Be a quarterback. Accountants should put themselves in the role of quarterback instead of playing every position on the field, and this applies to technological expertise as well, according to Sleeter. “The most trusted advisor doesn’t have to have all of the answers,” he says. “The most trusted advisor has to become that partner who thinks about the client’s business and finds solutions—some of which you provide and others you partner with others for.”
Clients generally don’t have the best insight into compliance, tax or business processes and technology solutions for efficiently running their businesses. That’s where accountants can be proactive. “Most businesses are run by entrepreneurs with that entrepreneurial mindset: that person has a particular mindset or passion or skill and they want to spend all of their time doing that, just like we want to spend all of our time doing accounting or tax or advisory work,” Sleeter says. Accountants who understand which technology solutions can help the client will have an advantage. “You become the giant filter that says, ‘For you, these are the tools we recommend.’”
Learn, learn, learn. Even if your firm decides to act as a filter of technology options rather than as a provider and implementer of solutions, a certain level of expertise is required. “You can’t even play the quarterback position if you don’t understand what the wide receiver does,” Sleeter says.
As soon as your firm hits a period that is less busy, focus on gaining education about various technology options. “Get out and attend conferences and web events, and immerse yourself among peers who are strong in that area,” he says. He suggests attending three or four conferences a year and participating in web events hosted by credible vendors or other sources that aren’t just selling but are also providing information about a specific challenge your clients or firm faces.
Focus on the value. In football, part of the quarterback’s role is knowing the team so well that you can utilize teammates’ talents for the biggest advantage. Accounting firms should be proactive about knowing clients, too, so that they provide the most value. “You study their business; you know their business better than they do in the area you’re consulting on,” he says.
One way to ensure you are offering the technology-related expertise and services that create the most value for clients is to survey clients about business processes and how they currently use technology, Sleeter says. Do they hand write checks? Do they use online banking? How much paper do they use? Numerous online sites, such as SurveyMonkey, SurveyPlanet, Zoho, SurveyGizmo and Google Forms offer free or low-cost methods of creating simple surveys quickly.
Taking steps to ramp up your tech know-how is good for your firm’s current business and for the value of your firm in the future, Sleeter says. Firms that eventually want to sell to an outsider will have little to offer if they’ve failed to remain technologically relevant. “If you’re getting out in a year and you’re old school and haven’t done anything with the cloud or technology, you might think your firm is worth perhaps one times revenue,” he says. “But [not] if your firm still runs on old technology with tons of paper and people-intensive processes.”
Mary Ellen Biery is a research specialist at Sageworks