Would you like apps with that? Lessons from Xerocon 2012Posted: August 13, 2012
I recently attended Xerocon 2012 in Melbourne. Xerocon is a great opportunity to talk and network with other Xero Partners and get the big picture as to where cloud accounting is heading. Most of all, it is an eye-opening insight into how Xero is evolving and the add-on applications can be used to improve client’s businesses.
This is my summary of the event.
Xero : The Accounting Backbone
With its single ledger, Xero is the backbone of an accounting system that is constantly evolving and improving. But it is more than just another accounting system – it is a business information system. If it is used to its full potential, it can provide an incredible amount of information and change how small businesses are managed.
To use a cliché, Xero is the “killer app” of Accounting that comes around once in a generation. It enables accountants to move away from the core business of crunching numbers and tax returns to become true business advisors.
Apps which integrate with Xero have proliferated. Apps for inventory, workflow management and debtor management are easier to integrate and have become more intuitive. It makes perfect sense for Xero to allow and assist applications which provide additional functions and reporting. Sound like a familiar model ? Apple – iPhone ?
In the past, most apps which integrate with MYOB required specialist knowledge (eg: Retail Manager Certification, and a fee paid to MYOB). However most tech savvy accountants could carry out an implementation of Workflowmax, Unleashed and Vend without needing extensive training.
Rod Drury’s blog post is required reading.
Package Your Services
There is a rush to offer accounting and bookkeeping packages to clients. Fixed monthly fees seems the way to go with business clients looking to stretch their dollars and have certainty on costs.
With a “me too” marketing approach, there was a view that we could be seeing a race to the lowest price in some cases and concerns that we are devaluing ourselves as professional accountants. I agree to a certain extent. But at the same time, new technology is being used by savvy accountants to distinguish themselves from the ‘Old School’ by offering more services in the same monthly or annual spend.
Clients have a budget for accounting and tax services. We can give clients limited services using old technology. Or we can give them more by using the Cloud. The budget stays the same.
Some firms have been outsourcing accounting work to Vietnam, India and Malaysia (And I bet the clients don’t know it). But Xero actually creates an impetus to in-source work back to Australia.
With the single ledger, bank data feeds, integrated with Spotlight Workpapers, reporting packs across clients, the time intensive processes of recording transactions, preparing accounts and tax returns are reduced. Rather than running “compliance factories” the pressure is on accountants to prove their worth as business advisory specialists.
Successful Xero Accountants
Successful accounting and advisory firms such as Growthwise, Interactive Accounting, Wilde Financial and 5 Ways Chartered have been early adopters of Xero. I believe the common threads between these firms include:
- websites which are being constantly updated, tweaked and used as the hub of their marketing effort, in conjunction with smart use of social media.
- client training and education about the cloud : rather than being processors of financial transactions, these firms are implementors and enablers. Empowering clients to use understand and technology.
- focus on startups and clients who are seeking to grow their business.
- 2-4 partners with complementary skill sets – IT, web developers, accounting, tax.
- flat organisational structures: Most of these guys have worked in larger, more traditional accounting firms and have seen the issues from the silo / pyramid type structures. Eg: failure to share information and ideas, old partners set in their ways, no imagination and no exposure to the real world.
What Clients Want
Although we have wonderful technology, clients have traditional requirements and needs. They want their phone calls returned or answered straight away We are already in an age of immediate satisfaction. Personally if I make an enquiry about a service provider and I have not had a response within 24 hours, I have moved on.
The pressure is on accountants and bookkeepers to be immediately responsive to client questions and requests. This should be easier if we are freed up and are not bogged down in transactional based work (eg: keying bank statements into MYOB or Handiledger).
Where To For Me?
Xerocon has been a real eye-opener. I came to the realisation that cloud accounting was the way forward last year. However the growth in Xero has been exponential for the obvious reason that it is much better and several steps ahead of the competition. Time for me to finalise the realtimeaccounting.com.au website and convert some more clients to the Xero single ledger so I can start practicing what I preach.