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Top strategies to improve your practice with data analytics

Dec 17, 2022 | Technology

Accountants need to move faster to adopt new technologies, practices have an opportunity to embrace data analytics and enjoy 5x faster decision-making compared to businesses that don’t take advantage of their data.

But overhauling your established operations can be a challenge. Here, we explore the roadblocks to success and how to solve them, as well as six ways you can start using data analytics in your accounting practice.

Major challenges to embracing data

Accounting is one of the most data-intensive industries, so it makes sense that most practices already have solutions in place to collect and harvest their most valuable data. From client information to internal financial reports to industry trends, this data – when analysed intelligently – can drive your practice forward with smarter decision-making.

However, far too many practices are facing challenges in making the most of their data. Here are four of the biggest hurdles we are seeing across accounting practices in Australia:

  1. No defined use case: Without a defined business case that is aligned to your business goals, there is no clear strategy around how you should be embracing data. That means game-changing data is regularly wasted and can even result in errors or misinformed decision-making.
  2. Poor resources, processes and tools: Too often, accounting practices simply haven’t put the time and effort into developing their processes, acquiring the right tools and deploying a clear methodology around how the business should handle advanced data analytics.
  3. Disparate data sets: Many practices collect data in various ways and across departments, oftentimes with different processes around how the data is held. This ununified approach to data management means that when it’s time to analyse the data, the amount is so overwhelming and so widely spread across different areas that it’s a struggle to even know where to begin.
  4. Lack of uptake: Accountants are the driving force behind your ability to harness valuable data. So poor user adoption can hamper even the most dedicated data management strategy. Get buy-in around your data analytics solution from the start and you will soon find that it is your team who will make it a success.

 

How to solve these common problems

While every accounting practice will deploy different processes for dealing with data analytics – depending on the size of the business, whether there is an in-house IT or data team, as well as the technology used to collect and analyse that data. However, of the challenges listed above there are a few key ways you can start to overcome them.

The first step is to clearly define how a data analytics initiative will make a strategic impact on your accounting practice. When everyone is on the same page from the beginning, it’s much easier to get consensus and positive user adoption – from the practice owners all the way to your newest employee.

Then it’s down to the technology. Do your due diligence in order to find the right data analytics solution suited for accountants. Next, establish your data management processes and identify the people within your practice who have the expertise to roll out an effective data strategy.

Disparate data sets can quickly complicate matters, so ensure all your data is consolidated into a single source of truth. Finally, roll out a strategic change-management plan to get total buy-in from everyone in the practice. your people.

6 ways to use data analytics in your practice

Still unsure how exactly data analytics can elevate your practice? Here are six ways that accountants are extracting value from organisational data:

  1. Plan for the future by accessing historical data (e.g. sales reports, budgets) in order to guide your decision-making over the coming year.
  2. Visualise and interact with your data to identify trends and patterns that may not have been apparent on the surface.
  3. Get better insight into your clients – data analytics can show you what they really want, what advisory services you could offer them, and how you can better market to your ideal customer base.
  4. Take advantage of competitive intelligence to track your performance against other accounting firms.
  5. Use data to help monitor your financial health with sales and expenses analytics.
  6. Use data analytics to support your strategic planning in order to set clear, actionable and achievable goals for your accounting practice – and plan for them accordingly.

 

Start analysing your data and drive greater insights with Access APS Practice IQ. Contact us to find out more or request a demo today.

APS is a product of The Access Group. We develop the software used by the best accounting firms in Australia and New Zealand to run their businesses and advise their clients.