In many countries Small and Medium Sized Enterprises (SMEs) are the growth engine of the economy. In the dynamic world in which we live the needs of this sector in terms of business planning and supporting growth are increasingly served by the digitalized Small and Medium Sized accountancy practice – the SMP community. The role of this community is evolving into a more advisory role that takes advantage of the technology and data that is increasingly available. This provides significant opportunities for both the practice and its clients.
The opportunities that arise from the advent of cloud-based solutions that are focused on this community that enable the efficient collection of data and subsequent analysis give the SMP a tremendous opportunity to deliver value and meet their clients’ needs. Both client and practitioner share the same data in real time.
For a practice embarking upon this digital journey the first step is to consider the target market that it wishes to focus on. The digitalisation allows practices to differentiate themselves in different ways. No longer are they geographically constrained, rather they can specialise in sectors or specific issues. The increased internationalisation of the SMP community provides opportunities to serve clients in different ways; to collaborate across SMPs, either informally or as part of networks and associations. This is, however, a transformation and evolution.
At the heart of the digitalised SMP is the range of applications that it chooses to use. The cloud-based solutions have a significant range of applications that integrate with them to provide a technology platform that extends beyond the traditional accounting software into customer relationship and broader solutions that were once just the province of the larger enterprise. Creating your own ‘app-stack’ that your practice is proficient in is important. You cannot master all the apps, nor can you support your client in base in doing so.
As the SMP seeks to specialise then they will reappraise the client base that they serve. New opportunities will emerge, and old relationships may evolve. These evolutions impact the business model of the SMP itself. Practices can now offer tiered pricing models and bundles of services ranging from compliance to ‘virtual CFO’ advice; each with a different price point and structure. Traditional working cycles based around year ends and tax filing deadlines are replaced with continuous data capture and the ability to proactively address issues as they arise. Digitalisation is partially initiated by due to regulatory changes such the implementation of digital tax filing.
Having the right skills to support the practice is important. The range of skills that will be found in the digitalised SMP will increase. At the core is the emotional intelligence of working with clients and understanding their issues; providing practical solutions to real problems. For many SMPs it allows them to provide more flexible working arrangements. To develop talent in different ways.
Perhaps the most significant lesson from this evolution is the reinvigoration of the client relationship. The passion for the client and its success. The true trusted advisor to the SME.
See examples of SMP Pacesetters below: