- Top 20% Xero accountants and bookkeepers giving IT advice
- Accountants providing traditional services with cloud are “lazy”
- Accountants and IT services to form partnerships
This is the third in a series of posts profiling Leanne Graham, technology entrepreneur and former head of sales of online accounting company Xero. In How Xero Added 120,000 Customers in Three Years, Graham discussed the sales and marketing strategy that helped drive the company’s growth. In Add-On Market “a Massive Opportunity”, Graham talked about the potential for cloud programs that connected to Xero.
An advanced group of accountants and bookkeepers using online accounting software are moving into business strategy and technology advice, says Leanne Graham, ex-head of sales for online accounting company Xero and technology entrepreneur.
“There’s a premier level of accountants that have transformed their business and their clients’ businesses through the use of cloud rather than just putting in online accounting software,” says Graham, who is now CEO of job scheduling app GeoOP. The top 20 percent of Xero’s accountant partners “have transformed their business to be a true business adviser for their clients”.
Graham predicts “massive industry changes” for bookkeepers and accountants, and says the transformation is well underway in New Zealand and has started in Australia. Accounting firms such as New Zealand’s DJCA and Sydney firm Interactive Accounting “don’t look like general accountants”.
“The real magic is transforming their business and the services they provide to take advantage of that cloud and they’re the ones that are winners out there,” Graham says.
The expansion of accounting professionals into technology is not moving as quickly as Graham first expected. “Two or three years ago I would have said that accountants are going to become the technology advisers and the business advisers in general, but I believe that for now it will only be a very small subset,” Graham says.
Within two years there will be many more accounting firms recommending cloud software to clients although they will compete with industry experts such as TradiePad, a popular cloud consultancy among trades and services businesses in Sydney.
While the technology exists to reinvent how accounting firms operate, it still requires a commitment to overhaul entrenched business practices. Not all accounting firms using online accounting software have improved their services or reduced fees despite gains in efficiency.
Graham says she “gets really disappointed” when people tell her their accountant hadn’t reduced their fees or provided extra service.
“The accountant should be charging the same fees but adding more value. They have the opportunity to use a little bit of time (saved from efficiencies in the cloud) to assist that business because they have the real time data to do so.
“A lot are lazy and they don’t. So they still do business the traditional way with cloud software.”
Independent bookkeepers were also going through a similar revolution. Graham points out Brisbane-based Jill of All Trades as one example of a bookkeeper helping to transform clients’ businesses through recommending cloud programs.
“We’re going to see very different accounting business at that top 20 percent,” Graham says.
Efficiencies in online accounting will also encourage accountants and bookkeepers to specialise in industries. “There will be generalists but the ones that tout expertise for trades or distribution or whatever, they’re going to be the most successful,” Graham says.
Accountants specialising in an industry will be more comfortable recommending a set of cloud programs that connect to the client’s online accounting program.
The shift of the accounting profession into cloud software will wipe out many traditional IT services firms which have resisted the rise of cloud services and software, Graham says.
IT companies that adapted to the cloud could find partnerships with accounting firms to offer change management, training and other services.
“I think we’re going to see a convergence of (sales) channels and better partnerships. We will see your hardware resellers cross-promote with accountants and other resellers,” Graham says.