In Technology, Business, Practice Management

Practice Management Software.

Great tools lead to greater efficiency,

By Michael Giardina.

What is the most important application in your firm?
At first glance this may seem like a simple question.

Accounting firms are dependent on the tax preparation and general ledger programs that allow them to provide essential services to their clients. Without these applications there would be no billings, and therefore no firm. But the question isn’t which programs are required to do accounting work in the first place—every firm uses one of a handful of popular tax and general ledger applications—the question is, what is the most important application in a successful firm?
In my experience, the firms that have been able to realize their full potential take advantage of applications specifically designed for practice management. Because a true practice management application should facilitate the work you’re already doing—from preparing returns to updating ledgers to consulting—while at the same time helping you run your business. It should help you address the three key facets of firm success: client retention, resource analytics, and market competitiveness.

Improved Services Increase Client Retention

We have all heard the seminars and read the articles on “crafting the client experience.” There are lots of resources out there to help you ensure that your clients have a frictionless, pleasant experience from the moment they walk through your door. And while these techniques are an essential part of building a positive relationship with your client base, your commitment to crafting the client experience needs to penetrate beyond scented candles and a feng shui-ed reception area—starting with the interaction between clients and staff.
Utilizing practice management software with a centralized database means that a client communicating with any member of your staff only needs to supply their name in order for that employee to instantly access relevant account information. From the status of their engagement, to account balance, to a progress update on their return, your staff is empowered to answer most client questions, regardless of the employee’s familiarity with the client or their account. Software designed to help you manage your practice should make every employee an expert on every client, ensuring that no client asking for the status of their return ever has to hear, “The person handling your return isn’t available. Can I have them call you back?”
Practice management software makes every employee more helpful to every client, simultaneously improving your service offerings and your client’s experience of those services. This is the type of efficiency multiplier that’s foundational to a successful practice.

Analytics are the Roadmap to Profitability

The real goal of any software implementation should be to make your business more efficient, and nowhere is that more true than resource analytics. Traditionally firms have exclusively used their time and billing software to generate this analysis, resulting in metrics that are too narrow to apply to your unique firm, or too broad to decipher quickly and easily. When looking at the profitability of a particular client or service offering, there’s more to the story than hours tracked versus revenue collected. At the same time, that story shouldn’t look and read like a Russian novel.
There needs to be a balance between generating reports that are simple without being simplistic, and basing those reports on rich, nuanced data without turning your staff into clipboard-wielding field researchers documenting every second of their day. To achieve that balance, you need time-tracking that is integrated into your workflow management. Then it’s easy for employees to track all of their time, not just billable hours.
Well designed practice management software should combine traditional time and billing with scheduling, project tracking, even document management so that time data from various activities can be mined and analyzed. What you end up with are reports that can help you identify how much actual time was spent on a project, by whom, and which steps took the longest. You can determine your office’s average turnaround time for a return, spot the outliers, and establish why those projects didn’t go out on time. This type of analysis gives you the opportunity to streamline your processes, increasing profitability across the board.

Greater Efficiency Makes You More Competitive

By now it’s probably easy to see that the real point of implementing practice management software is to increase efficiency. Whether it’s organizing and accessing client information, or time-tracking and profit analysis, these are tools for improving productivity. Because if a firm in your area can perform the same services at a lower cost, you run the risk of losing clients.
Competitiveness is about providing the same high quality services you always have at a cost the market will bear. With many of the services we provide being commoditized by consumer grade applications, it’s never been more important to stand out. As you continue to specialize and provide unique offerings, you must also give your productivity a tune up. Luckily, it’s never been easier to do just that.
New technologies have brought some significant advances in OCR and web applications for software designers in our industry. From scan and fill software like SurePrep and ProSystem fx Scan, to online document portals that allow you to not only securely transfer files to/from your clients, but post invoices, accept payments, and schedule appointments. Find the applications and services that best compliment your current offerings while helping you expand.
Take a good look at your work flow processes and staff resources, and determine how you can improve. I believe one of the best ways to do this is through embracing a comprehensive software solution to help you manage your firm.

What is the Most Important Application in a Successful Firm?

Regardless of your firm size or specialization, success hinges on your ability to manage core resources. Truly efficient management is a moving target—staff and client turnover naturally dictate an evolving workflow dynamic—which is why it’s so important to invest in software specifically designed to help you manage your firm. Let it do the time-consuming work of collecting and organizing data so you can focus on exercising the talents that made you successful in the first place.
So what’s the most important app in a successful firm? The one that increases your efficiency and productivity, and leaves your competition playing catch up.

About the Author

Michael Giardina serves as CEO of Office Tools Professional, which provides practice management software, educational conferences and the My Office Today magazine. He is the chief designer and architect of the firm’s practice management software, currently in its thirteenth year. Previously, Michael owned his own tax practice, provided IT consulting to accounting firms and was employed by multiple tax accounting firms. Prior to this, he worked with CCH Computax for 10 years as a trainer and product specialist. Michael routinely speaks on the benefits of technology at accounting and tax conferences as well as for online seminars. Having personally worked with over 400 firms, he continues to consult on office efficiencies and new technologies to improve firm practice management. Michael holds a bachelor of science in business from Metropolitan State College, Denver, Colorado.

About Office Tools Professional

Office Tools Professional, the provider of Practice Management Software Solutions, Practice Management conferences and publisher of My Office Today magazine, has received the 2013 Readers’ Choice Award in Workflow and the K2 Enterprises Quality Award in Small CPA Firm Solutions for the third consecutive year.

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