By Steven W. Schnur, CPA
Keeping up with the pace of technology changes is challenging, and sometimes baffling. Is this new software, computer processor or gadget really going to help my staff and me serve our clients faster, better and more efficiently? Or will we be frustrated and overwhelmed by the tools that are supposed to assist us as we grow?
When I began my career, way back in the 1970s, the “bullpen” was where several accountants shared a few adding machines and one mechanical calculator. It’s with no nostalgia that I say we used pencils to create paper spreadsheets and ledgers. At my second job, everyone had their own adding machine, but taxes were written on translucent paper and given to the operator of a Bruning machine to print.
Now each of my seven staffers has their own computer. We enter data once, and store it electronically. When we discover an error, one quick keystroke modifies each and every form impacted by the change. We rarely print anything on paper, even filing returns and reports via the Internet when possible, and sending clients’ their documents by email. The same tax return that took us upwards of two hours just a few years ago, now takes 15 minutes.
Technology hasn’t replaced the knowledge and value that accountants provide clients. We still need to understand the tax laws, and how the raw numbers interact to give a final result. Instead, we let technology handle routine processes, allowing us to provide analysis and expertise that the client needs to understand their finances. While accounting remains debits and credits, how the numbers get processed has changed.
In the 29 years since opening my own practice, I’ve grown from serving a handful of clients each year to more than 400 clients today. By leveraging technology, we experienced 15 to 20 percent growth per year. Technology has allowed us to manage this increased workload and client base. Being aware of the challenges of rapid growth and employing technology to overcome the obstacles has allowed us to succeed.
The challenges of growth
Any time you introduce change into a business, there is a cost, whether a tangible monetary one or a psychological one. Gearing up for growth means having the capacity to handle more clients. Your staff has to have the tools to work efficiently until you can justify hiring more employees. Letting your staff know that this transition is coming will help, but you can’t bury them too deep and for too long. Adding employees as your business grows means managers will be saddled with three to six months of training while doing their own work and generating new business.
Finding employees familiar with the latest accounting software packages and who embrace technology is one way to address this challenge, and is easier than ever. We recruit staff primarily through Craigslist.com, which for us has produced a technologically savvy job candidate pool.
Staying current with technology helps a practice manage growth. If your existing computer systems are very slow, or you have software and hardware that regularly break down, you’re costing yourself time and money, and probably frustrating your employees as well. Your computer systems should function well, help you complete your work, and save time. Being on the leading edge (but not the bleeding one) with systems results in more than just time savings for your existing staff. When you give them the tools to operate more effectively, you show them that you value their contribution.
The accounting profession doesn’t take full advantage of the technology that increases productivity, simplifies work, and increases the bottom line. Technology converts tedious chores into fast, accurate and cost effective electronic solutions that allow for growth.
For example, in 2000 we began scanning all our stored documents to electronic files instead of printing them to hard copies. While this took time up front, it saved more time on the back end. First, there was no more getting up to search for paper files, or wondering if a document has been misfiled, re-filed yet, is lost or in use by someone else. Second, retrieving and searching electronic data is infinitely faster than flipping through stacks of paper. Encouraging your clients to use software compatible with yours can make the transfer of data instantaneous and the use of paper practically obsolete.
Software considerations
Finding the right technology, specifically the accounting software that is the heart of your business, lays a strong foundation for growth. Choosing software that will grow with your firm will save you from unnecessary future pains of finding a new or perhaps more robust software product. The cost of having to work through the process of conversion and implementation twice will far outweigh any potential monetary savings you experienced up front or gains you may accrue later.
Understand your practice’s current requirements and your needs in the future. Get an evaluation copy of several software products to review. Identify and compare competitors’ software, paying specific attention to features you use and want. Here’s some additional advice:
• Stay focused on products specifically designed for the accounting sector. Do they provide the functionality and capabilities, reports and customization you need? For example, nonprofit specific reports should be available without being created from scratch.
• Consider growth. The ability of the software to grow as you add both users and data, and whether it is compatible with all operating systems (Windows, Mac, Linux).
• Customer Support. Inquire about support after the sale. All software has glitches, and business owners may find themselves tempted to play techie to save money. However, it takes a non-technical person twice as long to diagnose and repair a problem than a professional.
• Consider the learning curve. Training and ongoing support can often cost more than the upfront cost of the package itself. Much of any software learning curve is directly related to its capabilities, but the benefits long term may be worth the effort and expense.
Many accounting firms use write-up software from UBCC, Creative Solutions or other’s. We’ve been using UBCC’s software modules since 1990. We’ve found that, over the years, UBCC’s system has handled our increase in clients and data with ease. The company keeps its product up to date, frequently installing new features seamlessly; monitoring user broadcast email communications and providing quick fixes to any issues. Because of the way the software is written, UBCC works across all operating system platforms, as well.
UBCC does have a fairly steep learning curve when compared to some, but because of its scalability, reliability, portability across systems, and excellent user support, is worth the effort. We’re still finding new capabilities and they recently changed their pricing structure to make it affordable for smaller firms. We considered switching to Creative Solutions at a time that UBCC was going through some transitions, but found that UBCC had a greater reliability for us. We rarely have problems with UBCC and the software is compatible across all computer operating systems, so we’ve remained loyal customers.
The transition process
Small companies actually have an advantage over larger ones in changing, growing and adopting new processes and technologies. They aren’t committed to outdated systems and cumbersome technology. Most changes during a growth phase are incremental, so transitioning a few clients at a time to the new systems is easier than making a wholesale change. Smaller or growing companies have the luxury to take up to a year to make the switch for every client and user. Running the new and old systems in parallel, when possible, allows any kinks or bugs to be worked out along the way. Staff will appreciate a methodical approach to the transition too, understanding the expectations you have for them.
Benefits for the firm
Short and long term benefits for the practice are very similar. In the short term, you’ll become more efficient. Long term, you’ll be ahead of your competitors and already benefiting from the time, money and psychological boost, as your employees learn and do more. Growth will become easier with systems in place that adapt and change with you.
Another plus is that you pass these benefits along to your existing clients, and they become a marketing advantage when prospecting for new ones. We were the 125th firm to implement electronic filing capabilities in our area. That doesn’t sound that great, except when you consider that we compete with many thousands of CPA firms, enrolled agents, and tax preparation firms. Knowing that we’re on the cutting edge of technology is a distinct advantage for our firm and its clients, and allows us to capitalize on opportunities for further expansion and growth when they arise.