Being in the accounting services business has never been easy. Clients expect you to protect their revenues, provide the necessary advisory, and be available for all the financial firefighting. COVID-19 has affected a lot of this in one go.
Most accounting firms counted their productivity and the scale of work they could take, on the basis of how many people they employed. A lot of work was dependent on face-to-face interactions. Operations were critically relying on paperwork and pristine documentation.
Now – all of that stands to change. Some firms will take this as an existential challenge. Others would take this as an opportunity to catalyze growth. Work from Home and Social Distancing are real challenges to businesses. The key issues would be:
1. How do you conduct team meetings or training & development sessions?
2. How do you manage employee morale when they are asked to work for long hours to meet a deadline, but they are not in the office?
3. How do you ensure pristine documentation? Paperwork and other physical contact-based methods will go obsolete.
After extensive research and fireside chats with our colleagues, partners, and clients, we have developed a list of dimensions that will change for accounting firms post COVID-19.
Client Management and Core Service Delivery Will Change.
A major part of the auditing, consulting, advisory, and accounting work was already done on systems in the office. Physical document management was occasionally required, but only for legal documents. The majority of the service delivery was ready to be shifted to online methods.
The push to digital delivery methods will get accelerated. As more accounting firms deal with people working from home, and incoming queries from clients, investments in virtual working environments, collaboration tools, and ERP systems will go up. Teams will start moving the document transfer system, modeling, drafting, feedback, revisions, and final delivery processes to the secure platforms on the cloud.
All client communication and documentation processes are now up for disruption. Forget the face-to-face meetings, physical signatures, or wire-based data transfer systems. Everything will be moved to the cloud, digital signatures will replace old systems and feedback loops will be dependent on work-software systems.
Most of the teams dedicated to large accounting work will be working in virtual collaboration environments on the cloud, with their clients. Clients will be able to give accurate and real-time feedback on all deliverables. Eventually, this will result in quicker work turnarounds and free resources for more engagements.
Firms that choose to digitize only a portion of their process might even face inefficiency issues. Other firms in the market that have digitized their core service delivery methods would become more efficient. Cloud, automation, and enterprise analytics will aid in productivity growth. So, the firms that go digital at a large scale will get to keep the lion’s share.
Business Development Will Go Virtual.
Most of the business development for accounting firms is done with old-school methods. The senior partners go to industry conferences, networking lunches, and meet their network in person. With social distancing being exercised almost everywhere for an uncertain amount of time, most such events will remain canceled or constrained. Business development will have to adapt to the digital world.
For instance, – firms will start focusing on Google Search and internet-based marketing to generate leads. Not just this, an increased focus will come around publishing ebooks & whitepapers, hosting webinars, and even creating podcasts. Firms that are able to leverage the power of their digital assets like websites, social media, and mobile applications will get greater reach and traction with developing new client relationships.
Operational Management Will Become Data-Driven and Analytical.
The Corona impact on operations is that it pushes for challenges across the firm. As the firm starts adopting digital technology for client relations, work delivery, and firm management – the need for data-driven decision making will grow up. Take, for instance – tax consultancy.
Most new CAs are not equipped for direct client interaction on day one of joining; Senior Partners have to eventually chime in. Using chatbots and a simple mobile application tweak, you can automate responses to common tax queries. Firms that have the right resources will also go beyond basic VBA for auto reporting.
Even the regular tasks like timesheets and reporting systems will change. Instead of biometric sensors, firms might want to use IP-address verification on the cloud with employees working from home. Reporting and assigning work will dramatically shift since firms will have real-time access to what resources are engaged on what assignments. This will improve operational efficiency on the grounds of better resource allocation and the availability of precise data.
The work done by a conventional CA Office will not change for the time being. But the way the operations are run, from client relationship management to auditing and accounting work, will observe a sea of change with greater digital integration. Firms that are able to take this transformation on a strategic level will see greater efficiencies and, eventually – greater profits.
Firms will have to focus on cloud computing infrastructure, data storage solutions, and web & mobile access to most of the work processes. Some firms may choose to do this in-house, but the firms that choose expert vendors will be able to move rapidly and get economies of scale with their benefits.
So, if your firm is using legacy systems – this shutdown is posing as an opportunity to reinvent your operations to improve the long-term growth of your bottom line.