Capturing The Whitespace
Picture shows the increased efficiency firms attain as they spend more time in the cloud.
As I talk to accounting professionals across the US, I’ve been noticing a couple of recurring themes: many are interested in moving their practice to the cloud, but just don’t know how to take their first steps. Then there are those who aren’t ready, who want to be convinced why. Overall, everyone wants honest reasons, with actionable steps on what to expect and what to do – not just a sales pitch.
With that in mind, I’m writing a series of posts on the journey from Cloud Skeptic to Cloud Evangelist. I’ll go step-by-step, 10 of them in all, on “Moving your practice to the Cloud”. If you would like to hear a summarized version, feel free to join our Xero Summer Camp training event, which includes a webinar on this topic.
Capture the whitespace
Before I start, let me tackle the “why” question with this image at the top of this article.
As you move along the horizontal axis in time to the cloud, you become more efficient. On an hourly pricing model, this means your revenue drops as you do more work in less time. Using value-based pricing can retain your chargeable levels, illustrated by the whitespace. In addition to that, you can move into value-added services that come from the cloud’s ability to give you better collaboration with your clients via the Single Ledger.
You can spend time consulting to small businesses on what the numbers mean and what decisions should be made to move their businesses forward, versus just trying to get the numbers right and finding and fixing those hard to find data entry errors. This is how you can capture the whitespace and provide your value-add services to make your clients more satisfied with your services. This improves your working relationship, while making your practice more profitable.
Learn, expand and thrive
I’ve grouped the 10 steps into three phases that exemplify an accounting practice’s maturity in their adoption of the cloud:
- Phase 1: Learn
- Phase 2: Expand
- Phase 3: Thrive
The first phase, Learn, is about learning the basics and getting familiar with the new paradigm. Phase 2, Expand, is about leveraging the cost and time efficiencies of the cloud to increase a practice’s profit and expanding their services (or to provide more time for you to spend with your family or elsewhere). The last phase, Thrive, is scaling those efficiencies and focusing on the highest return activities. So, let’s jump into the first step to get you on the path of higher profitability and increased time to do more of what you prefer.
Step 1: Start using cloud solutions
As the saying goes, “eat your own dog food.” In order to recommend cloud solutions to your clients, you need to understand them yourself. The best way to do that is to adopt them in your own practice. Since it’s easiest to understand your own data (from your own practice versus a “sample company file”), you can focus on what the differences are from your new cloud-based solution versus your existing desktop or hosted solution. By doing this, you are able to focus your time on learning through numbers that are relevant to you, rather than trying to make sense of hypothetical data.
At this step, learn what it takes to migrate from your old way to your new way. Understand how the products are different from what you currently use, from the wording to the workflows. Keep asking yourself:
- What is different?
- What is new?
- How do I do this?
- Can I do this?
- What does that do?
- Why is this done this way?
Beyond this, be sure to think about how to take the next step with your practice while using the product. For instance:
- Which of your clients would work best in the cloud? Which would not?
- How you can improve your client relationships using the technology (e.g. proactive client management, collaboration tools and increasing client activity with their financials)?
Note the various surprises you have along the journey. See if you can get answers by checking the Help, the Community, or by asking the vendors’ support. Again, this is a risk-free way to learn so leverage it for all the learning that it can provide. By doing this, it will help you gain that first bit of confidence to go to:
Step 2: Identify your first 2-3 clients to move to the cloud (coming soon).
Jamie has been running teams at both large corporations and early stage ventures for over 10 years. Before he joined Xero, Jamie ran a North American business unit of accounting software provider Sage. Under Jamie’s leadership, Sage grew to serve over 500,000 small business customers.