Faced with the harsh reality that tax work is increasingly falling victim to commoditization, many accounting professionals are shifting more of their focus to value-added advisory services.
By bolstering its advisory services, a firm can help differentiate itself from the competition, enhance revenue, and create a stickier, stronger relationship with their client. Enter business intelligence tools.
As described by the American Institute of CPAs, "Business intelligence refers to the coordinated deployment of technologies, applications and business processes to support the collection, integration, analysis and presentation of business information." Its purpose is to help managers and others responsible for business strategy better understand their organization's operations, make wiser, more informed business decisions, and manage operational performance.
Many accounting firms have yet to jump into the waters of business intelligence tools -- but that appears to be changing.
Firm: Armanino / San Ramon, Calif.
Size: 450 staff members
Commencement date: 2011
On record: Chief operating officer and consulting partner Matt Armanino
Challenge/objective: One of the factors that sparked interest in a business intelligence solution was the fact that, in preparing reports for monthly executive committee meetings and partner meetings, the finance team was spending days pulling data from various sources.
Amount spent: The cost is driven by the number of users. Armanino estimated that if a firm were to start with an executive dashboard and have between five and 10 licensed users, it would cost about $25,000 to $50,000, and that their return on investment was less than a year.
Process: The firm spoke with its team of IT consultants who have significant experience deploying business intelligence tools such as QlikView, Adaptive Insights and Microsoft BI, and determined that QlikView was a perfect fit for the firm's needs.
After implementing the solution, the first big project was to create an executive dashboard with key firm metrics such as revenue, realization, staff utilization, effective rate per hour, and accounts receivable aging. "So, we defined the things that we wanted to track and came up with the first dashboard," said Armanino.
With QlikView, users can have different permission rights. "You can slice and dice the information in a self-service fashion," said Armanino. "Because you can do so much with it, we said our managers should have it, too. So, we gave them access rights to the information they could use."
Results: Armanino said that the solution enables users to better understand their business on a more real-time basis. The impact on the firm is the uptick on key metrics that impact profitability.
Next steps: Armanino said that it is easy to deploy additional dashboards, so it is likely that the firm will develop more of them in the future.
Benchmarking and beyond
Firm: Keiter / Glen Allen, Va.
Size: 140 employees, including 70 CPAs
Product/service(s): ProfitCents from Sageworks
Commencement date: 2010
On record: Partner Robert Gary
Challenge/objective: Those who implement ProfitCents from Sageworks can benchmark their business clients, use financial analysis reports to bolster consulting opportunities, and keep up with audit and review standards, according to the vendor.
The firm wanted to help its clients to benchmark their businesses to industry metrics so they could improve financial operations and adopt best practices within their industries, said Gary.
Process: "We first became aware of ProfitCents and other business intelligence offerings through our association with industry alliances [Boomer Circles and the Leading Edge Alliance]," said Gary. "We investigated various alternatives and chose ProfitCents."
ProfitCents provided training and support, and Keiter kicked off the process by identifying partner and manager "champions" within the various practices of the firm. It developed "power users" through training and field experience, and tracked the usage by monitoring engagements and case studies.
Results: "We believe that the product has benefitted the firm by providing value to our clients. This has allowed us to differentiate our firm from our competition, and answered our clients' desire to improve their performance by benchmarking their performance within their industries," said Gary.
Next steps: Going forward, the firm plans to utilize the information in those situations where it has substantial industry experience to enhance industry best practices and further develop its industry specializations.
Firm: HLB Gross Collins / Atlanta
Size: Approximately 60 staff members
Commencement date: Fall 2009
On record: Director of consulting services Jeff Plank
Challenge/objective: With iLumen, users can turn data analysis from a disconnected, labor-intensive process into an automated resource that helps the user increase revenue and grow the business.
Amount spent: $10,000 implementation, including staff time.
Process: Steve Gross, a founding partner of the firm, knows one of the founders of iLumen and that's how the firm became familiar with the business intelligence tool. All of the firm's clients are managed through ProSystem fx Engagement, which works closely with iLumen. After ensuring that all of the decision-makers were on board and working closely with the iLumen implementation team, the firm started using iLumen with about 60 to 70 clients -- mainly the larger, forward-thinking clients who understand and appreciate the value of the service.
Results: The solution "has worked out well," according to Plank. "It's a point of differentiation as we are meeting with new clients. We have created some custom reports that utilize the latest Construction Financial Management Association benchmarks and we use this product for all our construction clients. We like the integration with Pro System fx Engagement, our audit software," said Plank, who also noted that about 20 percent of the firm's clients are in the construction industry.
Next steps: The firm may create some additional custom reports for additional industry segments that it has expertise in, such as manufacturing/distribution and financial services.
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