As software becomes more powerful, one question stands out: how will automation shape the future of accounting? David Bergstein made some great predictions:
- “Workflow and Automation tools will eliminate data entry on the front end of all accounting systems.
- Firms will offer more Business Processing Outsourcing (BPO) & Advisory Services. These will become major revenue streams for firms.”
At Hubdoc, we believe that automation will transform accounting and bookkeeping practices for the better. Let’s take a look at the reasons why:
Reduction in non-value add tasks
Mundane data entry was once a task that had to be taken care of manually by accountants and bookkeepers. Tedious work, it consumed hours upon hours of valuable time.
In a world where computers excel in dealing with numbers and data, it makes sense to “hire” software to do that data entry work for you. This ethos applies across the board. Whether it’s moving from a manual payroll process to a software-driven one or using online bill payment, it’s more cost effective (and less error prone) to outsource these tasks to software.
Now, advisors can focus exclusively on services that bring significant value to their clients’ businesses.
Doubling down on advisory and outsourcing services
Business owners don’t want to deal with the nitty gritty details of accounting. They need consumable analytics and actionable advice. They would rather spend their time discussing business models, opportunities and strategies with their advisor. With software automating many of the manual tasks, professionals can focus on delivering value operational advice to their clients.
No longer will an advisor spend so much time slogging through manual processes. Automation helps accountants and bookkeepers move up the value chain. They’ll provide increased value by taking financial data and polishing it into consumable, actionable, and insightful guidance.
Together, automation and advisors are the perfect tag-team.
Advisors will have increased client capacity
Advisors who run all aspects of their practice manually are limiting their capacity. With automation, tasks are completed faster with less cost. This is a huge opportunity and means that advisors can support more clients without increasing staff.
BBK | beyond bookkeeping is a perfect example of a firm that’s done just that after they moved to the Cloud and started to use Hubdoc. They’ve streamlined their processes and with the time they saved, their existing bookkeepers are supporting more clients in less time. And, on top of that, the service their clients are getting is better than ever!
A practice can run well using manual methods, but it will never reach the same level of efficiency as a practice that’s utilizing software. It’s opening the way for firms to scale in a way they couldn’t before.
Value-based pricing will become the industry-standard
Automation is killing the billable hour. Since software is reducing the time it takes to complete a client’s work, it will be increasingly challenging to stay afloat by charging hourly. Software is making it a necessity for firms to shift to fixed, value-based pricing models.
This is a major shift and requires advisors across the industry to focus clients on the value they provide, as opposed to the number of hours they’ve worked. This is why Advisory and BPO services will become, as David Bergstein predicts, dominant revenue streams for firms.
Millennials will require modern technology
New generations are growing up with technology, like smartphones and cloud software. Speed and efficiency are table stakes. So why should accounting stagnate and be seen as complicated and manual?
As millennials dominate demographic trends, clients of accounting and bookkeeping firms will expect an increasingly streamlined workflow. In order to meet this expectation, advisors need to keep themselves up-to-date and integrate powerful software into their practices. With automation, they’ll be able to meet growing demand for quicker, more streamlined bookkeeping and valuable advisory services.
Advisors can utilize automation to make their practices more valuable and profitable than ever. How do you think automation will affect the industry?
If you liked this article, remember to subscribe to our blog for more!
Also, consider signing up for our upcoming webinar, 5 Ways to Future-Proof Your Practice!
The webinar will take place on February 2, but sign up even if you can’t make it: we’ll email you the recording.