Right now, life in the accounting profession is good. Growth trends are on an upswing with accounting market employment up more than 4% over last year and steady revenue growth since 2011. We’ve rebounded from the recession and are starting to gain confidence again. Time to sit back and relax, right? Wrong.
I’m starting a new “accounting trends” series on my blog, beginning with the broad theme of disruption. Disruptive trends are everywhere. Consider UBER, who has been frantically adding drivers to keep up with intense demand since its official launch not even five years ago. Earlier this year, however, competitor Lyft announced it is partnering with General Motors to create a network of self-driving cars that will pick up and drop off passengers at the touch of a button. And they’re not the only ones. Google and Tesla have been working on driverless cars for some time. For UBER, it isn’t if driverless cars will be developed, it’s when. And the ramifications for UBER are enormous.
So, what does this mean for the accounting profession? First off, we must understand we are not immune from disruption. No industry or profession is. As proof, consider these statistics from the 2015 IBC Future of Jobs Executive Summary:
- 47% of all existing occupations are at risk of becoming redundant.
- Over the next decade, millions of new jobs will be created that don’t yet exist.
- By 2020, it is estimated there will be a global surplus of 90 million low-skilled workers, and a shortfall of 85 million high-skilled workers.
- More than 500 million new jobs will need to be created by 2020 to absorb those currently unemployed and provide opportunities for the youth entering the workforce.
If that’s not enough to blow your mind, consider this statement: Only half the skills employees use today will be needed in 2020. 2020? That’s four years from now.
So, just because things are good, it’s important we do not let complacency set in. As accountants, we must make sure that a rebound from the recession and growth driven by mergers and acquisitions within the profession doesn’t fool us into thinking the accounting world is in better shape than it is—or let it mask some dramatic changes in customer activity.
Stay ahead of the curve: Be ready for the new accounting clients
Today, clients are looking for value beyond compliance services. They need tax preparation, accounting, and payroll services, but they want a trusted advisor who is going to help them run a better business, and grow that business. Firms today need to offer more than just the need.
Firms need to serve their clients with a mindset toward optimizing client experience. That’s part technology, part relationship, and part offering true solutions—not just after the fact reporting and compliance work.
From a demographic perspective, we know that millennials are outpacing baby boomers as the largest percentage of the population, and are now the largest generation in the workforce. And the new accounting clients for whom your firm will compete are far more sophisticated.
They grew up with technology, so they expect to be served differently. They don’t have the patience to work with professionals who—in their minds—operate in the past.
“A younger person is going to want to see a portal,” says Dale Jacobson, CPA, PLLC, whose firm is based in Austin, Texas. “They need to be able to communicate with you by text or email or send it through the portal. And they’re coming and asking for technology-based solutions faster than the generations before.”
Dale is spot on. Think about it. Does anyone today, not have a bank portal, for on-line banking? Or invest or monitor investments without using a portal? How about their doctors and dentists? Their pharmacy? A business without a portal today, is one that has long let the world pass it by.
The firms that will withstand disruption must be in synch with changes in technology, and elevate themselves to be connected advisors rather than after-the-fact reporters of financial or tax information. They also need to realize that accounting and reporting are only part of a good client relationship. Today’s clients also expect them to bring new ideas, proactive thinking, and a higher level of customer service. This means redefining what they do, how they do it, and who they serve.
“I see the accounting profession moving to advisory-based services. Clients are looking for one-stop shopping, for holistic practice management,” says Jacobson. “Essentially, we’re making the tax return a byproduct of everything else we’re doing rather than the tax return being all we do. That’s a big difference.”
Share your strategy
If you’re making changes to your firm’s strategy to take it into the future, I’d love to hear about it. Share your strategy in the comments section below.