Technology
Is the Virtual Practice Model Right for Your Firm?
When we first started writing about web-based programs about 10 years ago, the focus frequently centered on how the concept could benefit modern practices. Key among the benefits was anywhere/anytime access to client and firm data and the enhanced security of data stored in online systems.
Aug. 01, 2011
When we first started writing about web-based programs about 10 years ago, the focus frequently centered on how the concept could benefit modern practices. Key among the benefits was anywhere/anytime access to client and firm data and the enhanced security of data stored in online systems.
Yes, this data is safer “in the cloud” than on a computer or server in your office, which is at risk of physical damage, fire, theft, flooding or a variety of other disasters. You also have the added comfort of redundant servers, where major technology service providers automatically keep backups at separate physical locations.
As the years have progressed, mobility has certainly proven anything but a fad or a convenient add-on to practice workflows. And over the past five years, with the advent and mass adoption of smartphones and remote apps, the mobility movement has shown itself to be a powerful force in reshaping the very structure and workflow of modern practices.
Many practices have realized the benefit of remote workers, particularly with being able to recruit and retain talent. As far back as 2004, I wrote about a Connecticut-based firm that kept a military spouse on staff even after they moved to Alaska, and had another staff member who lived in Germany.
For an increasing number of tax and accounting professionals, however, this total mobility has even resulted in the dissolution of “the office” as it has long been understood. While the profession has had remote workers for years, the fairly recent ability to truly have the same workplace capabilities from home, the airport, a coffee shop or even a faraway beach, has led some business management to rethink the need for walls and a physical business address at all.
Why would a firm go virtual?
There are obvious financial incentives to ditching or reducing the amount of space in a physical office, starting with the cost of rent or the mortgage. However, many practitioners consider the equity and eventual ownership of a building to be part of their retirement exit strategy, as it is an asset that can eventually be sold. Firms will also realize a savings on utilities and maintenance costs.
However, most of the tangible benefits to going truly virtual are realized by small firms and sole practitioner that have already started to adopt web-based programs. This decrease in overhead can also make it much easier to start a new firm. For larger practices, the potential savings are not as significant, and personnel management issues can be difficult with a large staff.
Other benefits include the ability to easily hire or contract with professionals who are located anywhere across the country.
Virtual isn’t for everyone.
I noted that going completely virtual may not be as desirable or carry the same benefits for larger practices, although some have found success in such a move, such as AccountingDepartment.com, which has a staff of more than 40 full-time employees dispersed across the United States. But there are many other reasons that going virtual might not fit other practices, starting with client needs.
Think about your firm and how often your clients actually come into your office. If it is a somewhat rare event, then perhaps you could go virtual, meeting with clients at their business, at a shared office space, or by video or phone conference. But if you have more of a retail practice that relies on frequent client visits or walk-ins, then it’s probably not for you.
Some people desire the structure and organization that a traditional office instills, and some worry that they may be too easily distracted in a home office setting. And there are those who consider the idea just completely ludicrous. For these individuals, “the office is the office,” and it shall not be mingled with a home office.
The hybrid alternative.
Many very small firms and sole practitioners are experimenting with maintaining an office, but using it about as often as they work from other locations. This allows the solidity of a physical presence, while being almost as flexible as a totally virtual firm. Some professionals I’ve profiled in our Productivity in Practice series who operate this way include CPAs Michael Hsu, Kara Haas, Chad Bordeaux, Elizabeth Davis and William Miranda.
And even in practices with 15-20 staff, there’s a successful variation on this option. At this staff level, there are undoubtedly some professionals who are more production-focused, who rarely, if ever, meet with clients and who are already doing most of their work collaboration with other staff via electronic means, such as email and portals. If half of such a firm’s staff were encouraged to work from a home office, it would allow the practice to downsize its physical office footprint.
The virtual office may not be everywhere yet, but it is here. For those who embrace it, there are numerous benefits, but it’s not for every firm or for every client base. Ecommerce revolutionized many aspects in the retail space, but it did not eliminate the need for the brick and mortar business. And the physical tax & accounting office won’t disappear anytime soon. It’s simply a new option for SaaS-inclined, on-the-go professionals.