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Software on its own is not Business Advisory

4/10/2018

1 Comment

 
Don’t think that just because you have used business advisory applications, that this means you are now a business advisor. Software on its own does not provide business advisory services to your client.

Xero has created an environment over the past 10+ years of whereby they preached that Accountants can be business advisors now. Software vendors have followed suit by developing software that creates advisory talking points based on a client’s financial position.
Everything that Xero has said is not incorrect, accountants are positioned to provide advisory and everything that software vendors (such as Spotlight, Fathom, Futrili just to name a few) have created have also greatly assisted. However….

Here’s what you need to re-focus on and be wary of when providing advisory utilising software to present:
​
  1. Software on it’s own is not business advice
Just because you have a pretty piece of software does not mean you are providing advisory services or you know how to functionally use it in your client’s business to benefit their internal operation.

  • Crap in Crap out
The advisory software is only as good as the information being entered. Advisory software will NOT automatically deduce that the data it is reporting on is incorrect or incomplete and adjust for this. You need to make sure that the information being entered, either manually or automatically, is logical and correct. Reliance on automation alone, produces automated Crap if its not correctly implemented.

  • Software is not a bandaid and will not magically fix a business
Advisory software won’t make the clients business better or fix any underlying issues. It will only highlight any problem or positive areas that it has been told to report on.

  • Business advice goes beyond the numbers and software 
Graphs and charts provide understanding of financial data but do you understand them? If you are not trained in management accounting, nor have you ever run a business, then you might want to rethink what, if any, business advisory services you can provide to your clients. If you do not understand the graphs and charts how are you going to provide meaningful advisory services to your clients?
​
  • Software companies sell you their software’s training not advisory training.
​Software vendors mask their software’s training courses as advisory however it is actually just training of their software and not actually training you in any business advisory skills. They will train you on how to set up their software to produce graphs and charts but it is up to you, the advisor, to understand them.

  • Software does not provide you with soft skills
You now have to adapt your presentation skills, the landscape of the accounting industry is rapidly changing and you as the advisor will need to have soft skills to provide the services your clients are now demanding.

App Advisory
Xero is now putting an emphasis on app advisory and cloud integrators. App advisory is not your traditional sense of advisory when you think about what business advisory is. App advisory focuses on providing the client with the right application/s to run their business effectively and efficiently. It does not focus on traditional business advisory services such as Profit, Cashflow, Debtor days,Business KPI’s etc.  

Cloud integrators, such as Clarity Street, can help implement software for clients of accounting and bookkeeping firms and help them with their app advisory revenue stream. Get us involved both to assist your business to provide relevant business advisory software tools for your clients and likewise, if we can assist your clients for their internal software, well that only helps you the advisor out also.

App advisory will be discussed in our next blog in depth so stay tuned!

Go forth and advise...maybe prosper too!!
1 Comment
Thomas Jameson link
4/6/2019 04:39:56 am

It's good to know that software alone does not provide business advisory. My brother is interested in business advisory and is trying to gain as much information on the subject as possible. I'll pass this information along to him for his benefit.

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    Clarity Street was conceived from years of engaging with Accounting firms on a daily basis and a constant desire to make Accounting firms & SME’s more efficient and profitable. 

    The observations and opinions in the articles written here, aim to challenge, inspire and provoke change into making your business better!  

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