You Don’t Think Technology Helps Get New Clients?

"Good vs. evil in technology" illustration using laptopsTurn “necessary evil” into “welcome angel.”

By Hitendra Patil

“New clients do not come to me because I have an accounting software and/or a tax software. They hire me because I am a CPA.” A small firm owner from Los Angeles recently expressed this, on the condition of anonymity.

Does that summarize how accountants view technology spending? The new Accounting Firm Operations and Technology Survey gives us a surprising insight into how PRIMARY technology purchasing decision-makers view technology spending.

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Key findings from this survey indicate:

  1. Nearly one in six accountants thinks technology investments are revenue-neutral.
  2. One in two accountants thinks technology helps them differentiate themselves from their competition.
  3. Nearly two in five accountants think technology is an expense.

When this insight is broken down across smaller and larger firms, it is no surprise, though. For example, larger firms view technology as a competitive differential twice as often as smaller firms.

Technology investments are treated as an asset on the balance sheet but more likely viewed as an expense. Off-the-shelf computer software may be eligible for a Section 179 deduction, but this paradox of asset versus expense is likely to increase as

  • more and more software moves to the cloud and
  • accountants become subscribers paying monthly fees rather than users buying licenses.

Tax technicalities aside, the bigger challenge is evident in how accountants view technology as a necessary evil. It is more likely seen as a cost of doing business rather than an investment for creating a business.

One huge factor in creating this view could be how technologies are marketed by vendors. It is not uncommon to hear technology sales pitches that claim to save time and money. Ever heard of technology that claims to make time and money?

Saving, by its very definition, is restrictive – it means “do things at a lesser cost” or “spending less by doing less.” In either case, you still spend from what you have, not add to what you have. Such connotations of marketing messages could be triggering the perception that technology in accounting does not help get new clients.

As discussed in the post, Getting New Clients: Whats Working, Whats Notthe results of referrals remain steady and effective. Meanwhile, social media weakensIt is an insight that reflects a void in the technology market. While most vendors to the accounting profession focus on practice management and work-production technologies, the accounting profession has seen little use of software that helps generate sales and manage sales processes. If you answer just one question honestly, you will know whether you have invested in technology to get new clients. That question is:

“Does your website (or social media effort) generate new revenue every month?”

If you answered in the affirmative, congratulations! You view technology as a welcome angel. If, however, you answered in the negative (or not so positive), you are likely viewing technology as a necessary evil.

Here are some real-life examples of what technology can do to bring in new clients:

  • A firm in Los Angeles has a partner in charge of sales operations – with a team of telemarketers to generate leads and close sales. This firm obviously has invested in different technology to manage its sales operations and optimize its sales efforts.
  • Another firm, which went from 18 to 75 employees and from $2.8 million to over $10 million in annual revenue in just two years, has implemented inbound marketing technologies and a team that focuses only on new business development.
  • The Shared Economy CPA created technology to address a telltale service gap in the marketplace to make life easier for new economy micro-entrepreneurs.

And here are two multimillion-dollar questions for technology vendors:

  1. In the times to come, will technology vendors revolutionize the accounting profession’s viewpoint from “Get clients first – then get technology to service them” to “Have technology that gets you new clients”?
  2. Will technology help accountants get new clients?

4 Responses to “You Don’t Think Technology Helps Get New Clients?”

  1. Kirk Ward

    I have a big question about the statistics quoted in this article.

    If half (three out of six) of accountants think technology is a competitive advantage that differentiates them from their competitor, but one in six think technology is revenue neutral, does that mean that five out of six think technology enhances or damages profitability? What is the general view of technology among accountants? Is it a necessary evil, or is it embraced?

    I got the feeling from the article that the author felt that many accountants viewed technology as a necessary evil, and it would be wise for them to embrace it more positively.

    Can someone add to my understanding?


      Thanks, Kirk, for taking the time to read the post and share your thoughts. As the writer of this article, reviewing the survey results, I did feel that small firms predominantly see technology more as the cost of doing business than as an investment in marketing and growth. And it is also because I speak with accountants day in day out and a majority of small practice owners tell me that most of their tech investment is accounting and tax software. Some have invested in practice management software, workflow management software, etc. It is not common to hear small firms investing in softwares used for marketing purposes.

  2. Frank Stitely

    Great article. Good tech also changes your client demographic to younger clients. This feeds on itself as you get referrals from younger clients. Younger clients mean a more valuable practice.

    • Hitendra R. Patil

      Thanks, Frank! Indeed, good technology changes the client demographic. Accountants would also want to add younger clients to ensure “succession and retirement” of existing clients does not affect the revenue flow.