Online software has automated scanning receipts, entering bank statements and chasing debtors. A more ambitious app hopes to tackle an area once thought as safe from automation – accounting advice.
Two developers have written 5Things, a daily email which sends a business owner advice on what they should focus on to improve their business.
“The replacement of accountants, that’s what we’re facing in the long term,” 5Things’ Keran McKenzie says. “We always say that the next industry that is going to be automated is the accounting space. To a degree that’s true – but there hasn’t been any automation of the advisory side.”
The emailed advice is a step beyond dashboards, the opening screen of every recent accounting program, which show the most important numbers.
“Dashboards are great but you need someone to interpret that logic,” McKenzie says. The other problem with dashboards is that a user needs to log in to look at it. 5Things gets around that by emailing the tips to the user’s inbox on a regular basis.
How It Works
5Things’ advice comes in the form of general recommendations interpreted from the numbers in a user’s accounting program by natural language programming.
Events in the accounting program trigger the recommendations. 5Things will tell the business owner to call a customer if their invoice is overdue. This simple if-this-then-that programming is just the first stage for this technology.
Once 5Things accumulates enough users and data it could predict problems before they occur. For example, it could use predictive machine learning to warn other retailers in the area about a problem with the same late-paying customer.
Another use case is benchmarking. The app might show that nearby shops are making 10 times as much money. This could be because they’re part of a buying group, are using better rostering or a number of factors that drive profitability in the business.
“The benchmarking goes beyond accounting to general business advice,” says McKenzie, who holds a day job as MYOB’s API platform evangelist.
The app could also monitor performance of sales staff, says co-developer Lucas Eagleton. “If one of your staff are under target for the month we can see all that.”
The theory behind the app follows large-scale data analysis already occurring in medical, search and business trends. “In the medical space it’s helping doctors diagnose. More than just true/false, it goes to analysis and trend watching, (predicting) the sorts of things the person might be suffering from,” McKenzie says.
5Things Today
These goals are some way off; the current 5Things email is limited to a statement, impact and resolution. A typical message reads, “Your GST is $1200 and you have $600.” The resolution could be groups of activities to resolve that item such as by collecting on two or three invoices.
A company behind budget for the month would receive advice on activities to close more sales. Or if the business is running low on a product 5Things will prompt the owner to restock it.
The email contains buttons next to each recommendation that activate the task, such as making a call or creating a draft email.
Ironically, 5Things has also created a dashboard called View for MYOB AccountRight (the only app it works with at this stage). Accountants and bookkeepers can show View on a tablet and talk through 5Things’ suggestions with clients. “People still don’t quite get 5Things,” McKenzie explains.
And rather than automating accountants out of the picture, accountants experimenting with 5Things have used it as a conversation starter. In the shift towards advisory, natural language interpreters can reduce the time it takes to look up outstanding invoices and underperforming sales staff.
“Their customers love it because they are hearing from their accountant more often but the accountant is not having to do more work for those conversations,” McKenzie says.
For now McKenzie and Eagleton are treating 5Things as a proof of concept. There are no plans to raise money or create partnerships.
“It’s just us putting it out there and seeing what works,” McKenzie says.