The accounting profession faces so much change so quickly that it needs to start rethinking some of its oldest traditions, according to industry thought leader Michael Platt.
Speaking in the opening keynote at the Rainmaker Companies’ 2018 SuperConference, held this week in Indianapolis, Platt said, “The sacred cows of the accounting profession need to be re-examined. Are these beliefs still serving your firm well?”
Warning attendees that, “We’ve built businesses based on models that are old,” Platt, who is managing principal of the Platt Group and industry publication “Inside Public Accounting,” asked them to envision a set of firm principles, best practices, and business and service models that are radically different from current practice – and then explained that many of them have already been implemented by cutting-edge firms.
Here’s a selection of the “future” practices he mentioned:
- Imagine if books could be closed, and tax returns prepared, within a week of a client’s period-end. “There are firms doing this now,” he said.
- Imagine if technology provided the tools to assure the trust, verification and integrity of all financial transactions. “That’s the potential of blockchain,” noted Platt.
- Imagine if just-in-time staffing was perfected and working in your firm.
- Imagine if partners were financially penalized for star staff turnover.
- Imagine if relationships were purely virtual, with no face time needed.
- Imagine if firms perfected a business model where staff choose to work for them for no more than four years. “That’s heresy right now,” said Platt, “but it’s the future.”
- Imagine if partners had to be re-elected every four years.
- Imagine if an Orbitz-like website existed for accounting and consulting services.
- Imagine if staff evaluations were no longer a formal process – if feedback was real-time.
- Imagine if career success didn’t hinge on making partner.
“All these things are happening today,” Platt explained, and the pace at which similar changes are impacting the profession is only accelerating.
“It’s an exciting time for younger people to come into this profession, because there’s so much that’s new, and so much innovation,” he said. “It’s a little scarier for those of us with gray hair – or less hair.”
Nonetheless, firms need to start addressing these changes. “Now is the time to start thinking about how to transform your firm,” Platt said. “Things are good now, but the golden goose is quickly becoming a silver swan.”
Typically, firm leaders spent the overwhelming majority of their time, energy and resources on running their business, he explained, but warned that they need to spend much more time on transforming it.
With that in mind, he shared three quotes that he had recently heard from leaders at cutting-edge firms:
- “We are too focused on services clients don’t want.”
- “We’re preparing for compliance work to go away in 10 years.”
- “We’ll see more change in the next 50 months than in the last 50 years.”
Firms won’t just need to change what they do, but why they do it, according to Platt. “How is the definition of success changing?” he asked. “Is it still revenue per partner? Or is it the impact we’re having on our employees and our clients and our community?”
For all the changes that firms will have to undergo, though, Platt noted that the future is bright.
“There’s a lot of opportunity to go along with the challenges facing accountants,” he promised.
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