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Accounting & Audit

COVID-19 Pandemic Accelerates Digital Transformation Strategies for Accounting Firms

As the world reels from COVID-19 and its ensuing economic effects, accounting firms are forced to innovate on a dime to ensure business continuity in the new normal. The economic shutdown and slow recovery have exposed just how much disruption the ...

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As the world reels from COVID-19 and its ensuing economic effects, accounting firms are forced to innovate on a dime to ensure business continuity in the new normal. The economic shutdown and slow recovery have exposed just how much disruption the pandemic has levied — and how accounting firms have successfully pivoted on the fly to innovate, evolve, and position themselves for success in the post-COVID-19 business environment.

Throughout the last decade, accounting firms have faced pressure to meet evolving client expectations. Some firms believed that building a website and keeping it updated qualified as digital transformation — but not anymore. The pandemic has shined a spotlight on the need for firms to reimagine the role of technology for client service delivery, and firms now realize that implementing a robust digital transformation strategy is a mission-critical imperative.

When the pandemic overcame us, firms scrambled to put the pieces together to support a virtual workforce. Now that we’re 6 months in, most firms are through the reset-and-replan phase and moving forward on planning the next 12 to 18 months. It’s clear — industry-wide — that the time for strategic investments in digital infrastructure is now. Read on for key takeaways on how smart firms are making the adjustments required to survive and thrive.

1.     Client Delivery-Related Technology

Firms are reimagining the role of technology for staying connected to clients. Client-facing technology solutions — including online collaboration, conferencing, and e-signature tools — have made secure document sharing a must-have feature. In the long run, firms will implement innovative engagement delivery methods, such as client-facing portals with built-in workflows and secure transmission.

2.     Internal Operations Tools

Firms are using operations technologies to increase margins, manage costs, and reduce engagement-delivery risk. Financial management systems that house practice-related data identify resource allocation opportunities in high-demand practice and skill areas. For instance, experience management systems allocate resources across the client lifecycle, optimizing the seamless delivery of work and client satisfaction.

3.     Strategic Cloud Adoption

For years, CISOs have lobbied leadership for buy-in on transitioning to cloud-based solutions, and leadership has resisted. However, with the virtual business model a baked-in certainty, firms no longer have a choice on cloud adoption because — without the cloud — their people can’t do their jobs from home effectively. Cloud-based solutions not only provide secure data storage, but also a centralized data repository that provides firmwide access from any location across devices. Ultimately, a cloud-based infrastructure protects a firm from preventable disruptions and revenue loss.

4.     Connected Firm Insights

Today, only a small minority of firms have achieved the level of connectivity required to create the tipping point where strategic investments in digital infrastructure are building sustainable competitive advantage. Most firms are spread across the journey, and struggling to get a handle on their data. Because the data is the backbone of the connected firm, the first step is to unify it, focusing on eliminating silos, improving data quality, and providing firmwide access to a centralized repository. Once the data is connected, you’re in a great position to build the processes required to enable your people, streamline your operations, and improve your service levels.

5.     Automation

Firms with high-volume legacy processes can leverage robotic process automation (RPA) tools to reduce human error and accelerate time-to-value. The key is to start with low-hanging fruit — tasks that can be easily automated with digital workflow tools — and then determine if these processes are ripe for RPA. As part of this exercise, firms should conduct a cost-benefit analysis of delivery across client lifecycle processes to identify areas that are well-poised for automation and digital workflow tools.

Going forward, investments in cloud-based digital transformation initiatives will be key to keeping up with the evolving realities of the new normal. Creating a dedicated change management team to set clear goals and objectives is a great way to get started. The benefits around eliminating manual processes and human error through automation — along with creating firmwide access to a centralized data repository — speak for themselves. Firms that have progressed beyond the technology baseline through the use of AI are achieving impressive results. For instance, firms that use artificial intelligence and algorithms to perform complex and laborious tasks — like conflicts clearance — reduce time spent on conflicts clearance by up to 60% — which is nothing to sneeze at.

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Mark is President of Accounting and Consulting and Chief Strategy Officer at Intapp. He is responsible for leading company strategy, planning, marketing, strategic consulting, and merger and acquisition success. He has more than 25 years of executive experience in technology, building on leadership and partner roles within professional services firms. He was previously a partner at A.T. Kearney and PwC, and was the founding CEO of E2open, the SaaS software firm, which had a successful IPO in 2010. He can be contacted at: mark.holman@intapp.com