Accountants losing time and money to tech
Research confirms that the lack of integration between digital tools for businesses is leading to costly double-handling, errors and unused subscriptions.
- Accounting practices are among thousands of small and medium-sized enterprises (SMEs) losing time and money to inefficient digital solutions, a recent study has found.
- The MYOB Disconnection survey found that SMEs are wasting seven hours – or one day – a week, on disconnection issues.
- Australian and New Zealand businesses are wasting $1.77 billion per year on unused digital tools.
Accounting practices are among thousands of small and medium-sized enterprises (SMEs) losing time and money to inefficient digital solutions, a recent study has found.
The MYOB Disconnection survey was sent to more than 2000 sole traders and SMEs across Australia and New Zealand between 24 March and 17 April this year. It found that SMEs are wasting seven hours – or one day – a week, on disconnection issues.
Nine in 10 businesses are wasting time on manual and duplicated tasks and, in total, Australian and New Zealand businesses are wasting $1.77 billion per year on unused digital tools, the survey found.
A time suck
As many as three out of five SMEs are experiencing ‘bad digitisation’ or what MYOB defines as “a lack of integration between digital business tools and systems which don’t talk to each other or work in unison”.
“One of the things we’ve recognised is that, as an industry, we’ve been putting the onus on our customers to make it all work,” says Daniel West, MYOB chief sales and support officer. “They're just not seeing the return on investment or the value that has been promised from digitisation as a concept.”
David Rea CA, a chartered accountant at the Rea and Associates practice in Springwood in the Blue Mountains, NSW, says over the past six or seven years in particular, the efficiencies that digitisation was supposed to deliver have not quite eventuated.
“There is now an expectation that cloud accounting is going to resolve all the issues and that kind of falls flat,” he says, adding his practice frequently loses time and money when staff have to learn new digital systems that don’t talk to each other.
“It’s a complete waste of time [and] we can’t recover all that time,” he says. “We might have four-and-a half-grand on the clock but we only invoice clients for maybe one-and-a-half grand of that. So, it's just a complete loss exercise.
“And there are no economies of scale because they keep changing the software,” Rea adds.
Part of this is due to regulators’ requirements to use specific systems that talk to their platforms.
In a perfect world, Rea wouldn’t necessarily return to a paper-based office, but he would like software providers and regulators to investigate the use case of some of their systems.
“There is too much reliance on data collection, without understanding the purpose,” he says.
Providers need to step up
West says MYOB has been focusing on the issue for some time and wants to provide businesses with a cohesive business management platform that solves the disconnection issue.
“Whether you’re an SME or an accountant, you didn’t start your own business or become an accountant in order to become an IT consultant and be responsible for evaluating and integrating these solutions,” he says. “But I think many businesses now have accepted this is just the way things are; that it’s a normal part of doing business.”
“… you didn’t start your own business or become an accountant in order to become an IT consultant and be responsible for evaluating and integrating [digital] solutions.”
MYOB’s focus is around six key business processes it believes are vital to business operations, West says.
- managing jobs (quoting, scheduling)
- managing staff (payroll, workforce management)
- managing suppliers (quoting, tracking)
- managing banking and cashflow (invoicing, payments)
- managing finances and compliance (tax, core accounting)
- generating revenue (CRM, point-of-sale (POS) integrations).
“If they can be automated and digitised effectively, it can make a phenomenal difference to a business’s chance of being successful and scaling and growing efficiently,” says West.