The cloud has given accounting firms a chance to restructure their operations, processes and internal structures. But many firms are still oblivious to this massive opportunity, and have no clear idea how to implement such a strategy.
One of the first things to ask is where you’d get the biggest efficiencies in your practice. In my mind that’s the accounting functions and processes. It’s every firm’s focus, where most staff spend their time, and the bread and butter of what they offer their clients. So making this as efficient as possible will provide a bigger ‘bang for your buck’ than focusing on other areas of your business.
Yes, you’ll also benefit from adopting a Google Apps/Microsoft 365 platform, implementing new document management systems, and so on. But those benefits will be minimal compared to restructuring and increasing the efficiencies in your workflows.
Here are four key strategies to take advantage of those opportunities:
- Automate processes by adopting the Xero platform
- Identify any tasks that don’t add value, and find a way to outsource them
- Identify areas where you can offer clients more services and value to increase the revenue generated per client (and probably the average hourly rate achieved)
- Put action plans in place to achieve them all.
Adopt the Xero Platform
With Xero releasing their tax modules (and their new version of the Report Packs coming soon), they now have a complete practice management solution for accounting firms. Adopting such a system will provide immediate benefits and efficiencies from features such as:
- A single ledger for clients to share data (instead of having to upload data between systems)
- Automatic bank feeds in client files to ensure all data is being captured
- Electronic workpapers with features to send queries directly to clients
- Journals that update Xero files automatically.
The new-look Xero platform will provide a much more efficient base for doing client work.
Outsource tasks that don’t add value
Too often write-offs are generated by incorrectly allocating staff to tasks. What’s the point of having staff with a $200ph charge rate doing file preparation and admin tasks?
By identifying tasks that don’t add value to the client file, you can allocate them to more junior staff or even outsource them completely. That will allow your more senior staff to focus on their value-adding tasks, which is what your clients really want.
Examples of non-value adding tasks you could outsource include:
- Basic data entry,
- Populating your practice platform system from clients data source (if you’re not using a single ledger)
- Preparing workpaper packs with source data.
Identify other potential value-adding services
What are you offering your clients besides normal tax preparation functions? Do they know you can offer them more?
It’s amazing how many clients don’t know what other services their accountant can provide.
One simple strategy is to show a client where his cashflow will be in 12 months if they don’t take any further action. This can lead to one of three conversations:
- A strong cashflow can lead to conversations about SMSFs, investments, and planning for retirement
- A flat cashflow can lead to discussions about improving business performance to generate wealth. You can also talk about monitoring the business more effectively and setting goals to improve its performance, which could lead to additional management work with that client.
- A negative cashflow can lead to conversations about the need to closely monitor the business’ performance before it goes under. Again, it could lead to more management work helping the client improve its performance.
Creating Action Plans
Focusing on your accounting systems, and the steps outlined above, can create efficiencies in your firm that will allow you to offer more value-adding services to your clients.
Want to start restructuring your accounting firm so you can create efficiencies and offer more services to your clients? Contact Zerobooks today and we’ll help you create a plan to make it happen.