LinkedIn Twitter Facebook

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. His business interests include a diverse range of industries from manufacturing to property to technology. As a technology commentator he has a broad presence both in the traditional media and extensively online. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

More about Ben here.

5 responses to “To Partner or Not To Partner….”

  1. Michael Dunham

    You bring up some interesting complexity – but I think it is in how the application is positioned and what it is offering to accountants as well as the “end-user” SMBs.

    As a user of computer accounting apps, I find them to be unnecessarily cluttered and with far too many steps to be really “inviting” to use. I’ve done regular, double-entry, columner pad accounting so I know where the steps iin the process come from – but that doesn’t make the applications that mimic the process any easier to use. As you wrote, something needs to break the pattern and come at it from a more logical direction for the business user.

    On the other hand, accountants who receive the output do need to see the information in standard accounting contexts. So – why isn’t there a separate “pro” version of the SaaS app that is for accountants – online. What if those accountants who had online accounts in the app, could set up contracts with their customers to use the online business user version – and share their data with their accountants?

    Why would accountants want to do this – have you seen accountants’ offices? Do they generally have IT resources? (no – certainly not full time or senior level) Do they need more reliable systems? (imagine a break down at tax time – it happens frequently) If the SaaS app provided resources for downloading the data to local sources and smart extractions for local spreadsheet development – and it offered a way for the customers of an accountant to use compatible software without buying it or more hardware or more headaches – it would be hard to say no…

    But to do this – as you point out – the “end-user” version for SMBs has to be really designed from the ground up for them – not a clone of existing desktop accounting software. The accountants version has to allow for review of several client accounts on a regular basis and to answer questions as they arise. It is a different direction and the product managers for the application have to step back and think about the new opportunities an online system can leverage.

  2. Ben Kepes

    @Michael

    Thanks for your comment – great thought. As you say a lot of “revisioning” has to happen. My bottom line? The accounting industry as a whole isn’t up to that yet.
    Cheers

  3. Rod Drury

    If anyone believes that accountants are not an important channel for accounting software then they do not understand the accounting market. Our initial market research showed that in 80% of cases, if a small business owner has an accountant then the accountant chooses the software.

    Accountants work with small businesses in a range of ways and over the last year we have delivered on most of those scenario’s. In many cases the small business owner doesn’t even see the accounting software. Xero Accountants Edition handles that. At the other end of the spectrum accountants are becoming virtual CFO’s. Xero flys at that.

    What we’re working on now is a range of additional tools for accountants that allows them to do proactive management reporting, which is now cost effective for them to do now the data is all in one place and they don’t have transfer it between the accountant and small business as the desktop model requires. Feedback has so far been excellent from our accounting partners.

    Accounting software needs to link into the Practice Management systems of the Accountant, or you just don’t get sales traction as they accountant does not want to double handle data.

    Selling to accountants is much easier when you have generated end use demand. Interest from Accountants accelerated when end customers demanded Xero and accountants lost customers by not offering Xero services.

    Yes accountants do take some time to move. Traditionally they have not had a great experience with software so you can understand that. The frequent release cycle possible with SaaS accelerates that trust relationship because each month you can prove you are listening and delivering. But it still takes time. Maybe 2-3 years.

    But it’s worth taking the long term view as accountants are a very leveraged channel. Each one may have hundreds or thousands of small business customers. You can’t win accountants overnight but when they start flipping to your software then they will drive a significant proportion of new customers.

    SaaS accounting does change the balance of work between the business owner and accountant. Some will save money, all will get better value with their accountant and the accountant can be much productive and profitable but it is not a black and white situation where software takes over the role of the accountant. That is just fantasy.

    Well designed software will empower and create value for all stakeholders and understand the reality of your market. SaaS does present a challenge for accountants to look at how they redefine some of their services but no way does it cut them out of the picture.

    My 2 cents.

  4. Ben Kepes

    @Rod – thanks for the comment – I appreciate your forthright contribution.

    I guess I liken the SaaS accounting/Accountant situation to that of SaaS PM/PMPs. SaaS PM software has, to a certain extend, obviated the need for PMPs.

    Put it this way – a traditional accounting practice that does primarily compliance work can hire a semi (or not at all) qualified accounting technician for $20/hr and charge them out at many times that. The move to the scenario you envisage – where accountants do high value work means they’ll need highly skilled (and paid) commerce grads or post grads. For this there charges risk many times and hence the pool of work does also.

    It’s a numbers game and I’m just not sure the economics or the market allow for the wholesale move to a higher value add model.

    But as always I’m happy to be proved wrong!

    Cheers

  5. A Vertical That's Starting To Make Sense | CloudAve

    [..] Xero’s strategy is very much one of partnering with the accountants and leveraging that relationship to on-board new customers. I’ve been avocal scepticof their strategy thus far – I felt it was destined to mediocre results at best, relying as it did on partners that, to a certain extent were being disintermediated by the very product Xero is trying to sell. I have to say my perspective has changed with this announcement, But first some background. [..]