Of the roughly 9,500 registered accounting firms operating in Australia, only a small percentage have migrated their own systems into the cloud.
Even inside the country’s biggest and brightest accounting firms, the vast majority still run their practice management solutions from the desktop.
Most firms continue to store tens of thousands of emails on an exchange server at a massive cost, rather than moving these to the cloud.
Millions of businesses around the world rely on Google Apps and related cloud products, but the accounting sector is largely refusing to get on board.
The majority of firms even use a server for emails, apparently believing that emails are more secure if the data is physically stored in their office building – as long as the front door is bolted shut at the end of each working day. It’s ludicrous.
A well-established accounting firm in Melbourne invested $100,000 in a new server room. It’s completely redundant and inefficient technology that’s being dumped by some of the leading industries around the world. And yet an accounting firm just upgraded the technology with a provider of course more than willing to take their money, no questions asked.
This technological inertia among accounting firms can delay or discourage industry adoption of new technologies.
Refusing to adopt
There’s multiple reasons that accounting firms are lagging. One of the reasons is that firms simply don’t know any better, and they’re not sure how to find out.
Not practising what they preach when it comes to cloud adoption has a number of serious ramifications for the accounting sector. Not only does it mean that accounting firm’s profits are being spent on unwarranted expenditure such as outdated servers that take up a huge amount of space, but investing in these areas create a number of inefficiencies within their business.
The decision to put off technology adoption is also restricting the industry’s ability to communicate more efficiently with their clients for one – particularly when clients have already adopted.
Accounting firms aren’t conducting their own technology reviews to look for new efficiencies. So many don’t know where to start. They aren’t fostering close relationships with IT experts to advise them on cheaper and more efficient upgrades.
Age is of course part of the problem, too. Management in the accounting industry is dominated by baby boomers, with the average age of public practitioners well over 50.
Frustration among millennials
However, as the accounting professional prepares for the generational shift and millennials become a huge asset, they’ll get frustrated with a firm that doesn’t move forward with the use of technology.
A recent report from
Firms need to be at the forefront of innovation in tech to be an attractive workplace for millennials. They have zero interest in working in a firm that’s afraid of change and still operates in the same way they did a decade ago.
Millennials also want to work for firms doing interesting and innovative things internally, so adopt new technology and try out new approaches. Not every technological development will mesh with the firm, but the right ones will propel the business forward.
The accounting sector should also bear in mind that without adopting technology, they will be left behind. More than eight of 10 (86 per cent) Australian businesses expect either rapid or unprecedented technology change in the next three years, which is far higher than the global proportion (28 per cent), according to Accenture’s recent Technology Vision research.
In fact, digital channels and data are proving to be vial tools for connecting with customers, and can also open new product and services opportunities.
So, take incremental steps. Start with your exchange servers. Next, look at apps, ancillary products and then practice management software that can make your firm more efficient and better communicators. Automation will free your firm up to focus on business advisory and higher value services, rather than just being a tax collector for the government.
And your firm’s technological proficiency will truly drive success and growth for the business by being an advantage for staff on the inside, and also an impressive feature for clients looking in.
Successful accounting firms need to be bold and willing to evolve – to the point that innovation becomes ingrained and applies to anything and everything that happens. Or they’re going to be left behind.
Wayne Schmidt, practice advisor, Karbon
