Digital Transformation

Accounting firms lead the next wave of digital transformation

‘Accounting firms are well placed to guide small and medium businesses to help them select and integrate the right apps’ explains ​​​​​​​Nathan Keeley, Partner, Carpenter Box, a PrimeGlobal member firm.

It wasn’t too long ago that a firm could appear to be digitally savvy by talking to their clients about moving from premises-based IT servers to the cloud.  And having knowledge of apps was seen to be at the forefront of change.  However, coming out of the pandemic there are very few businesses which have not embraced cloud services.  Apps have moved way beyond automating finance functions and now cover all aspects of business processes.  The use of apps is so prevalent that references to app eco systems and app stacks are commonplace.  For those of us who are not tech specialists this can be very confusing. It used to be so much simpler, we could go to shops like PC World and buy the software they recommended.  Now there are thousands of apps available online all claiming to offer the best solution for business needs.   

The next phase of digital transformation will focus on selecting and using apps relevant to specific individual businesses’ needs - apps that increase efficiency and support growth.  Accounting firms are well placed to guide small and medium businesses to help them select and integrate the right apps.  PrimeGlobal member firms across the UK are working together to support their clients with this transformation.  The association has also partnered with Xero to ensure firms have the right market offering.

Nathan Keeley, Partner, Carpenter Box, PrimeGlobal member firm

Meeting client need

Small businesses need help.  “We are finding small businesses are eager to automate processes and want to try new services covering financial reporting, advisory support on apps and HR advisory including people and planning”.  Keeley explains that helping clients with analysis and finding solutions takes a considerable amount of time.  It is therefore critical to prioritise and identify which clients provide the most opportunities and focus on those. Keely describes the steps to work through with a client: 

Start by understanding the clients’ processes.  To understand which apps might help the client, analyse who might benefit from cloud systems.  A segmentation session provides an overview of what systems clients are currently using. It also enables a review of processes to see if they are efficient and can be improved.

Identify opportunities, for example, the client is using a desktop accounting system which could be moved to a cloud.  Or they may manually key in purchase invoices and receipts, so an invoice scanning system (OCR) would create efficiency.

Identify apps that may provide solutions.  The starting point is to look at what is referred to as ‘horizontal’ apps.  These are apps that provide automation over processes that are common to most clients.  For example, an OCR app that deals with scanning of invoices or expense processing apps.  It’s important to ensure these apps integrate to the clients general accounting platforms.

Identify ‘vertical apps’ which are industry relevant.  Xero has a very large number of integrated apps on its marketplace many of which relate to specific industries.  For example, in relation to the construction industry Xero have around forty job management apps.

Prioritise relevant apps narrowing down to two options.  This makes it manageable to really understand the app and help the client embrace it.  It also provides a backup if an app provider disappears, or they no longer integrate with key systems.  Ensuring your client has a fall-back app is critical for business risk mitigation.

Ensuring you are ready

Firms must ensure they have teams who are on top of app development and integration.  Carpenter Box has a dedicated team of cloud advisers who have specialist knowledge and can recommend digital solutions to clients.  Keeley stays close to developments as a key member of most of the leading cloud software providers' advisory boards in the UK. 

Bringing firms across PrimeGlobal together to share practices and collaborate helps firms move forward rapidly.  In the UK, a Digital Community of Practice has been established which has helped firms develop app groupings to support clients.

The benefits of working together include:

  • The daunting prospect of reviewing thousands of apps becomes much more manageable as firms can learn from what others have already assessed.  This also helps them identify back up apps for their clients. 
  • Research time is significantly reduced as generally accepted app stacks relevant to specific industries are shared. 
  • Common industry approaches are developed. 
  • Training is coordinated.
  • Incentives can be negotiated with app providers, including price discounts. 

Firms are also able to explore new business models.  Carpenter Box, for example, has stopped building software costs into the overall package of fees.  As the market grew, they found they could still be paying for licenses that were no longer needed by the client.  They now bill software licences separately through a subscription model like Netflix.  This gives them more visibility and control.

Help clients embrace digital

As business advisors, accounting firms have an opportunity to show businesses how to use digital services to drive productivity and growth.  Firms have the key skills to lead the next phase of the digital revolution.  Many firms are at the vanguard and are willing to work and share with others.  This is the time to come together, learn and ensure your client sees you as a digital leader.

Main image: Lyndsay Hardwick, Senior Business Innovation Manager, Milsted Langdon