Today, SME cloud accounting is reducing the manual handling and re-keying of data and increasing accuracy. Practitioner lodgement service (PLS) will increase better two-way acquisition and submission of data with the ATO. Document portals and electronic signatures will reduce the time and administration to follow up clients.
This is still only the start of automation, with Artificial Intelligence (AI) and machine learning continuing to drive even more efficiencies. The plateau today reflects the challenges many practices are having transitioning to other forms of revenue, specifically in advisory services.
This does not mean that compliance is going away nor does it mean that it is not important. Compliance has been the bedrock of the relationship between the accountant and small business for a long time and is a highly trusted relationship. The compliance relationship, therefore, is the key to unlock additional advisory services. However, many accountants are finding it hard to find the time or know where to start in offering additional services.
At MYOB, we spend a lot of time and effort researching SMEs. We recently surveyed close to 1,000 small business operators to uncover their top business needs. These are tasks that SMEs acknowledge are critical to business success but either don’t have the time to complete or are not satisfied with their current approach. Seven of the top ten unmet needs identified were advisory services including:
- Tracking performance of financial goals
- Detecting financial issues that could adversely affect my business
- Estimating future revenue and expenses
- Understanding expected future cash position
- Developing plans to achieve new business goals
- Advice on improving profitability
- Advice on growing their existing business
This research reinforces the demand in the SME community for more advisory services that SMEs need to ensure their own business success.
To recognise these opportunities though, we need to engage with our clients and understand their needs.
MYOB’s vision is to help businesses succeed. However, what success looks like for one business owner may not be the same for another. For example, we recently showcased the story of an adviser and two of her clients. Each of these business owners were tradies, and for one, success was being able to provide for his family by working four days per week so he could maintain a work-life balance. The other was looking to grow his business, expand his services and hire additional staff.
Understanding these differing needs, the adviser could help each business develop plans for action, have regular check points to review whether plans were on track and when specialty advice was required, she could connect her clients to these specialty advisers.
This is not just limited to business clients. Our company vision also states that “We know that business isn’t just business, it’s personal.” Clients, particularly those who run small businesses, will not necessarily have a clear demarcation between their individual position and their business. Their business and investment structures, for example, will reflect their own personal goals regarding risk, growth, taking care of family and tax.
The regular interaction and relationship that accountants have with their client through compliance provides a great opportunity to uncover their clients’ drivers. Using tools is a great way to engage with a client, providing them with a complete picture of their net worth and financial assets with features built in to automatically provide valuations on business or investment properties and motor vehicles.
Importantly though, it provides a channel to elicit from the client their specific unmet needs, the areas of their personal and business life that they are concerned about and looking for assistance with. Offering additional services to clients becomes more customer centric and is a much easier conversation as the services are tailored to address the client’s needs and goals.
Having identified the services to offer, the next challenge is to find the right tools to deliver them cost effectively to the client. Planning, budgeting and reporting can be achieved with reports or exporting data out of the SME accounting system. However, much of the effort goes into manipulating data rather than in providing insights and guidance to the client.
There is a much more efficient and engaging way provided by the large ecosystem of MYOB partners that have a great set of tools for delivering advisory services.
These solutions range from dashboard and reporting tools such as Cyfe, Spotlight reporting and Fathom that allow you to generate insights and visibility into the financials and operations of a business, to Calxa, Reep and Castaway that allow for more sophisticated budgeting, forecasting and analysis of business drivers.
Compliance is and will remain an important component of the accountant relationship with small business, but long-term technology will continue to drive efficiencies and reduce the revenue associated with it.
Advisory services are a key opportunity for practices to leverage the existing relationships they have with SMEs to address the large unmet demand for services that SMEs are looking for. To make the transition, better understanding the client’s needs and goals, not only of the business but the business owner, will help to target the right services to help the business succeed and expand on the trusted relationship.
Learning and understanding the ecosystem of tools out there to deliver these advisory services will allow the accountant to scale and provide these solutions in a more engaging and cost-effective way.
By Paul Greenwell, head of product strategy, partner solutions, MYOB
