The Last Frontier of the Digital Accounting Firm: How Technology is—Finally—Transforming Practice Management Reviewed by Momizat on . Five key questions to determine whether it’s time to switch to a digital system At many firms, practice management software is often referred to as the “last fr Five key questions to determine whether it’s time to switch to a digital system At many firms, practice management software is often referred to as the “last fr Rating: 0
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The Last Frontier of the Digital Accounting Firm: How Technology is—Finally—Transforming Practice Management

Five key questions to determine whether it’s time to switch to a digital system

At many firms, practice management software is often referred to as the “last frontier”, according to Matt Jagst, Director of Enterprise Product Management in the tax & accounting business of Thomson Reuters. Most firms manage to get by with outdated systems and processes. Switching to digital software that integrates time, billing, workload management and other functions into one application not only shores up client relationships, but puts real money in one’s pocket.

 7-11-2013-top-story“It’s old, but it gets the job done.” This is a phrase that has kept countless time tracking and billing systems limping along, well after they’re past their expiration dates.  Even as firms roll out shiny new client-side technology, practice management often creeps along in a parallel universe of carbonless copies and sticky notes.

This has made practice management something of a “last frontier” at many firms, one of the last places that remain largely untouched by digital workflow and the cloud.  As firms continue to see the benefits of their client-side technology investments, many are asking themselves whether hanging on to old internal systems is a wise choice.

That was certainly the case for Matt Pyle and the DD Pyle Company in 2012.  The company’s old practice management system, which had been cobbled together over the years from a variety of software systems, was becoming a major bottleneck with too much paper and too little transparency.  Still, the company was hesitant to change.

“Like a lot of accountants, we’re creatures of habit,” Pyle said.  “We’re so busy, that any change that’s not absolutely necessary can be very difficult, but we realized that the risk of doing nothing was greater than the risk of making a change.”

They decided to move forward in late 2012 by implementing a customized system over a two-week period.  During that time, DD Pyle representatives worked closely with a Thomson Reuters consultant to train and tailor the system to their workflow. The new system integrates time, billing, workload management and a variety of other functions into a single, cohesive workflow that integrates the firm’s other applications.

“In addition to sapping productivity, hanging on to an outdated practice management system can expose your firm to significant liability.”

Pyle said that a digital system pays dividends in file management, decreases overhead for paper costs and dramatically reduces the amount of time spent searching for documents.  This valuable surplus of time is better spent making more informed management decisions. 

As accredited professionals, this experience underscores how we can provide additional services to our clients’ businesses. Integrated practice management systems also hold new possibilities in mobile practice management, including  offering apps that enable firm principals to see work in process (WIP), account receivables (AR) and other key information on mobile devices. Some even provide remote time tracking and expense entry.

With this in mind, now may be the time to ask ourselves whether or not our clients’, as well as our own firm’s practice management system is really getting the job done.  Moving into the realm of digital practice management is also a potentially powerful  way to shore up client relationships and put real money in our clients’ pockets.

In addition to sapping productivity, retaining an outdated practice management system can expose a  firm to significant liability.   Therefore, it may be wise to ask some tough questions about your firm’s time, billing and management systems, including:

Is your practice management system a “black box?”   It’s common for practice management systems to morph into an increasingly complex web of antiquated systems, a “black box” that only one or two people in the firm can navigate.  What happens if that person leaves the firm?

How are you entering time?  If you’re using an Excel spreadsheet or a paper-based system, it’s likely that you’re missing billable hours.  It’s also likely that you’re wasting valuable time at the end of the month trying to determine whether posted time is accurate.

Is your billing process slowing your cash flow?  How long does it take your system to bill the client after services are rendered?  Long lag times can be a serious impediment to cash flow.

How do you access your archived data?  Your archives are a valuable source of information that you can use to make future predictions and manage more effectively.  If that data is difficult to find and use, it’s a lost opportunity.

Is your software supported? If the manufacturer of your software has stopped supporting your application or worse, gone out of business, even a minor technical glitch can get expensive in a hurry.

Learn more about how to implement an integrated practice management system here.

 

Matt Jagst represents Thomson Reuters tax & accounting products focused on the largest firms in the profession.  He works with clients, prospects and others in the profession to evaluate the needs of firms in the market and customize software technology to meet those goals.  Matt has worked in the tax and accounting software profession for 19 years.  He holds a Bachelor’s degree in Accounting and an MBA from Eastern Michigan University.  For more information about digital management systems, he can be reached at Matt.Jagst@ThomsonReuters.com

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