Rapid technological change means accounting and advice firms must go back and assess every process and method to ensure they are effective for the future.
“There is clearly a big disruption happening here,” Smithink director David Smith told an SMSF Association New South Wales chapter breakfast event in Sydney earlier this month.
“And it is creating, I think, in professionals’ minds this requirement to really look at the business and how to leverage this opportunity to provide more business advice to my clients because there’s going to be more challenges around the profitability and the way compliance works [and] is going to be done in the future.”
At a practice level, the first step was to take one step back and essentially deconstruct the firm, Smith said.
“What I’m talking about is to take every process that you’ve currently got and throw it away,” he said.
“When I speak to most professionals and ask them: ‘Why do you do it this way?’ what do you think the answer is?
“That they’ve always done it that way, but the fact is technology is changing the world so dramatically now with so many changes that we need to actually take a step back and [recognise] that the way we did it in the past is not the right way anymore.”
He stressed an organisation could not be changed overnight and should aim for a time frame of 12 to 18 months for reinvention.
“I believe you need to have an initiative in your organisation where you take every process and chunk it all down,” he said.
“Look at each process – it might be how you do a timesheet or how you process a bill – throw it away, take a plain sheet of paper and take into account technology change, requirements of customers, et cetera, and [ask] what’s the right process for the future?
“That’s what’s at the core for reinvention here.”
Furthermore, technology was just the enabler, he said.
“It’s all actually about process – you need to think about the process and then the technology comes behind it to power that process to make it work,” he said.
“That in my mind is the fundamental thing that you need to do.
“At the end of the day, if there’s a message for you, it’s to really understand the technologies and think about how you can re-engineer your practice from the ground up to leverage this.”
He also highlighted that practices were not using their existing technology or systems to their full potential.
“What really gets to me is that you’ve made this investment into technologies for eons, but how much of it do you reckon you’re using?” he said.
“The statistic is that people use about 15 per cent of the [technology] that they’ve got.
“One argument is: do not buy anything else, just use what you’ve got more effectively.”
