The Next Generation of accounting is here. The question is: Are we ready?
We invited industry experts, Ron Baker, Hannah Dawson, Nicole Rousseau and Erin Vukelich, to provide insight on things like the industry changes we can expect, employee attraction and retention, and what it really means to be a Next Generation accountant.
What does it mean to be a Next Generation accountant?
Nicole: The next generation accountant is no longer just an accountant dealing with debits and credits and the compliance aspect of the engagement. Our industry and the world have changed, and we need to change with it.
The Next Generation accountant is a business partner in a client’s business and as such need a different set of skills versus 10 years ago. You need to be forward-thinking and really understand your client’s business and the direction in which they need to take it.
This requires a diversified skill set. Yes, you need to be tech savvy and embrace digital transformation, but you need to also have soft skills, be good at communication, problem solving and more importantly, you need to be able to make a connection with your client.
Erin: The Next Generation accountant is going to be a more well-rounded individual than in the past. They’re going to need to know more than just tax code or audit compliance. Clients are asking for more assistance in understanding what financials mean, and we’re going to have to become teachers for our clients and partners.
We’re going to be looking at more than just numbers as well. I believe we’re going to be delving into operations processes to determine how best to affect the overall health of our clients’ businesses.
Hannah: The world has changed, forever. Businesses have been stretched beyond recognition and the role of the accountant must change. Firms need to change their processes in response: identifying staff with core skills, becoming more tactical, proactive, strategic in their own businesses.
Compliance is a treadmill. Small business success and cash flow is a minefield. There are tools that exist today, such as Predict+ which can prioritise workflows in this next generation manner.
Ron: The Next Generation accountant is a knowledge worker, engaged in life-long learning, and probably more importantly, unlearning. He or she needs to constantly replenish their intellectual capital, and develop deep, meaningful social capital- that is, relationships with customers, colleagues, and business leaders.
How can we inspire accountants, who still prefer the old ways, to become Next Generation accountants?
Erin: This is so difficult, and one of the best ways to do it is by data. Show them the difference in service that we can provide our clients with empirical data. For most traditional accounts, this is by fees, but I don’t necessarily think that is the answer. By sharing client satisfaction and our clients’ success with those accountants, we can show that we’ve made valuable and trusting relationships.
With those relationships typically comes higher fees as we are able to perform more work for the clients as they work on what they do best. This isn’t easy by any means, but we should at least start having the conversation with the traditional accountants.
Ron: Data can only confirm the past, it can’t predict or change the future. Innovation and creativity always take us by surprise, otherwise it wouldn’t be needed and we could run the world with algorithms.
We need to get back to creativity and innovation and you can’t do that being obsessed with efficiency, data and processes. No one works at Apple or Google because it is efficient; they work there to change the world. Firms need to have bold visions, not merely increasing realisation and efficiency by 5% per year.
Hannah: Data doesn’t lie. Cloud accounting like Xero is the starting point. Dext Precision then plugs into the front end and identifies the health of the core Xero data. Both saving time and creating efficiencies. But historical data assessment is not enough.
Small businesses are failing and falling by the wayside. When accounting revenue starts to reduce significantly in 2021, perhaps that will be enough of a jolt to make a strategic change in their operations. Changes that don’t need to be huge – these are simple and quick ones that can make an enormous difference.
Nicole: Data drives decision making, and in our profession, real-time financial data is what our clients need in order to take their businesses to the next level. In saying that, not all staff might understand this initially or be open to change. It is very important to be transparent with the staff and communicate effectively with them about the value proposition you are implementing.
Share your vision and create a project plan, so that the staff feel included and support them through this process. You can’t force buy-in, so it is a continued process of reassurance, training and support. You need to constantly remind them why this will benefit them, the firm and the client.
It’s also critical for top leadership to lead and drive the implementation. And remember it is a journey, not a race and all staff members are different, so the adoption rate will vary from person to person. Just keep re-affirming the staff, eventually they will get there.
How can accountants attract and retain the right people?
Erin: By providing them with a working environment that allows them the flexibility they need and want. We need to move away from the 70+ hours per week where we’re accounting for every second of the day. Also, giving the right people the space to dive into their interests and show the businesses’ investment into those people can make sure staff feel valued.
Hannah: By creating inspiring and future-focussed places of work that aren’t ruled by compliance. It will always be there, so find efficient ways to bookkeep, offshore, process and make a real difference to your clients – not with traditional advisory, but with simple clear accountability check-ins.
Ron: By treating them like adults, not making them account for every six minutes of their day. By trusting them to do the right thing, not micro-managing them. By having a purpose driven by an inspiring vision, not just to make a profit but to change the world (or a corner of it).
To build a firm that is as human as the people inside of it. People are not assets, or resources, they are human beings with all their foibles, strengths and weaknesses. They are knowledge workers, and all knowledge workers are volunteers.
Nicole: I believe you need to create a working environment that is appealing to potential staff members and that will promote growth. It’s not a simple task, but the firm culture is quite important for potential employees.
Our people are our most important asset in our business, and you need to treat them as such. Of course, adopting digital processes and applications like Xero and Dext also changes the way the staff work, and it provides them with greater opportunities to grow and evolve as individuals. They morph into advisors who are proactive instead of reactive and this is a big motivator.
What are and what should accountants be talking about when they are recruiting?
Hannah: People and how they will interact with clients. What ideas they have for modernising a firm, how they would use technology to improve processes and maximise profits – business questions, more than accounting questions. Gen Z expects a very different approach than millennials.
Erin: Technology they are familiar with, but more importantly how they use it. I try to ask questions to determine whether they let software dictate what they can do, or are they able to take the technology and make it do what they want.
Also, talk about how we focus on the client relationship. Traditional accountants were stereotypically “number-crunchers” and had “poor people skills”. That isn’t the case anymore. We need to be able to connect with others, and asking questions that focus on those soft skills is incredibly important.
Nicole: You are no longer just checking technical ability. There is a bigger focus on technology, their adaptability and how they interact with tech. It’s vitally important to assess the potential employee’s soft skills, to ascertain their ability to communicate and truly build a relationship with the client. As advisors you become a sounding board and support structure and they need to have those skills.
Ron: That the firm is an excellent environment in which to invest their intellectual capital. It will earn them a premium and they’ll be well treated. They won’t have to complete a timesheet –
we understand that the value they can create is not all correlated with the time they spend working, or where that work is performed. We price based upon value created, not time spent.
Your performance is your review, and we only look at results, not inputs. We have more interesting customers because we are selective about who we serve.
About the Experts
Erin Vukelich is an Accountant at JCCS PC, who has a decades’ worth of accounting experience. Her rise at JCCS PC started when she took on a role as administrative assistant, while completing her degree in Accounting from the University of Phoenix. After graduating, Erin progressed to the Accounting and Payroll department, where she was asked to build the foundation for the Client Advisory Service department. Erin was instrumental in inspiring Senior Leadership to implement applications like Dext. It’s all part of her ongoing mission to modernise accounting and advisory practice to better serve clients.
Nicole Rousseau is the Co-Founder and Head of PKF Ignite, the Advisory Arm of PKF – a platform designed to be accessed anytime, anywhere, on any device. To this date, Nicole has been part of a team that has trained and up-skilled over 100 accountants to become true business advisors, as part of their mission to disrupt the accounting industry via cloud and digital technology. This enables business owners control over their business, so they can make informed decisions based on real-time information.
Hannah Dawson is the Founder and CEO of our partner app, Futrli. Her personal mission is to future proof small businesses with new innovations in forecasting tech. In 2019, Hannah joined a cohort of the world’s finest entrepreneurs and innovators when she was chosen as one of the Maserati 100. Hannah is dedicated to the one hundred and fifty million small businesses that need her support, and believes that by implementing the right technology, she is providing the tools modern businesses need to actualize their goals.
Ron Baker is a global value pricing expert and the Founder of the VeraSage Institute – the leading think tank for educating professionals internationally. He started his business journey in 1984, with KPMG’s Private Business Advisory Services in San Francisco; since then, he has written a long series of bestselling books and has his own radio show on Voice of America. To this date, Ron has spread his value-pricing message to over 220,000 professionals and has been named on Accounting Today’s 2011 to 2019, Top 100 Most Influential People in the profession. You can follow Ron on Twitter @ronaldbaker.