Managing your own practice (business) is a gratifying and fulfilling experience, especially if you’ve worked many years to make that dream a reality. In today’s competitive and rapidly changing economy, business environment and regulatory framework, managing the practice may be the single most important skill for every practicing professionals whether he is a Company Secretary, Chartered Accountant, Cost & Management Accountant or Advocate. In some ways, the traditional principles of practice management are under such pressure that they may never be quite the same again. Today, it looks like, there isn’t any single best principal to run the firm.
One can say with surety that, only marching at the same pace with the changing trends is one of the grave challenges for professionals. They have to constantly march with tax rules, company law rules or with changing technologies of tax collection portal or company law portal or any other government designed portals. However marching at the same pace is not a strategy at least not a strategy for success. Most of the successful firms I’m seeing these days are marching at a higher pace to reap benefits.
The lesson from these firms is that you don’t need to march at the same pace at least not in the traditional sense. These firms teach us that success depends not on providing so many kinds of services, but on providing few services with the utmost excellence. The study shows that the firms which embrace change (lighthouse professionals, who adopt the new technologies and innovation in the nascent stage) display higher growth rates and superior financial results.
Today, new business models are being invented, tested in the live environment, gets modified based on performance and tested again in the corporate world. The same thing is happening with our profession also, but real change could come just as likely and more significantly, from outside the professional world. Professionals have options today they never had before. Options in ownership structure; Options to compete with each other; Options in outsourcing the assignments; Options in choosing between employee and intern; Options to implement the technology. Indeed, the chief innovation in the professional field in the past years is not, as is often said, technology. Technology doesn’t change anything in and of itself; it simply expedites the process of change. Change in the professional field is driven by competition and competition drives innovation. Yes, you understood it right; Innovation in doing practice is the chief innovation in past years.
We are in the midst of a cell phone-centric technology wave that will one day be looked back on with the same reverence as the industrial revolution. Technology is an integral and irreplaceable part of the business cycle and those who have adopted yet haven’t reaped the rewards of having a competitive advantage. Businesses that haven’t adopted it either lost market share or in most cases wound up their business.
So, is the whole notion of practice management as we know it antiquated? Remember, the term practice management only came into the professional field after the implementation of tax portal, company law portal and an emergence of social media in professional’s life. Before that, operating the firm was hardly deemed a science. By the entry of online government portals and Facebook, WhatsApp, LinkedIn like social media platforms, the advent of competition and innovation unleashed, bringing firms marketing tactics out of the closet, firms were in dire need of marketing strategies and policies to manage their practices like a business. The professional was been able to take the work of any client across the globe without even meeting the client. They also can file any document with any state authority with the single click of a mouse.
With the options available to professionals today, we''re now seeing a mix of business models.
Zero Infrastructure Model: One can start a firm with a laptop and a cell phone in the corner of Café Coffee Day, Starbucks or any other café lounge without spending the dime on Infrastructure.
Google Model: One can do accounting easily or file returns, forms without being the professional member of any Institute with the help of software or googling the answers and checklist.
Soloprenuer Model: One can be global as a soloprenuer, or one can be a global firm that operates like a bunch of soloprenuers (commonly referred as one roof solutions, doing all kinds of work like the direct tax, indirect tax, company law, excise law and others by the single professional).
Value Model: Value-based pricing of the work means professional will not price based on how long it will take an employee (intern) to complete the work, he price based on the value of the services, which he will bring to a client as outlined in the engagement letter/ scope of work.
Disruption Model: There''s even a model amongst the practicing professionals which operates for free; it makes it''s revenue on advertising and other means (CAClubIndia, ClearTax, Compliance Calendar LLP, Erience).
Modern practice management strategies need not include the desktop, laptop, printer or scanner. It also doesn’t require any tangible assets on the balance sheet of a firm. The firm’s practice should be interactive in nature. Many professionals face pain points when it comes to organizing data, tracking assignments and managing finances.
The profession seems composed, I believe, for a great step forward. Who knows what the step will be? In fact, it may not be only one step, but so many at once also. Whatever the step maybe, it will be based on the diversity of rapidly changing and expanding business models and options available to professionals. Looking at how diversity has affected other business cycles and analysis of historical and technological trends suggests that the change will come so quickly and one won''t be able to see it coming. May be the next big thing of the decade is already here. We just don''t know it yet.
The firm today frequently perform work outside the traditional practice offerings and it is critical that their data is accurately and timely managed. Modern practice management software delivers tools required to track due dates and client information, employee (intern) time allocation on assignments, pending assignments, to-do list, daily planners, earnings, zero interruption communication flow, and a host of other items. Adding assignments in the practice management software allows adding multiple tasks, notes and reminders, assigning employee (intern), devising workflow steps and due dates of the work completion along with the online document management facility.
Historically, all of the practice management software was centered on timekeeping data for each employee. Many firms have shifted their business models to focus more on tracking works and delivering client satisfaction through the same. Considering that the modern practice management software also shifted their focus to an assignment, which is the deliverable and clients tend to focus on. Many firms are seeing the need to revisit profitability associated with each client and client group considering the changing trends and shrinking profits. A good practice management software is designed to be the center point of the professional’s practice. Only handful of the practice management software provides the required tools to do the practice efficiently, smoothly and can really help in increasing the profitability.
‘Dashboard technology’ is vital to practice management. With the help of same professional can see the data in real-time, status of all assignments, pending client invoices, to-do list, daily planner and a host of other analytics. The ‘dashboard technology’ is generally customizable as per the particular firm’s needs. Through this customization, a firm can focus on what’s more important to it rather than getting the generalized view of the dashboard. Only handful of the practice management software additionally provides alerts to assist in focusing the probable problems and deadline reminders (like Erience, iFirm). This allows the opportunity to shift resources and focus of the firm to meet the deadlines and ensuring maximum productivity and profitability.
Traditionally, assignments were tracked internally through oral means or MS Excel. Tasks and employee (intern) time allocation were often done oral means or other non-technological means. Document management was a headache and lead to a complicated work environment often and ultimately a disappointing client experience. Practice management Software Bridge the gap and provides the smart work (assignment) tracking system, efficient assignment of employee (intern) and managing the files online in a single click.
All professionals need the practice management software to run practice, as it provides efficient and smoother ways of doing the assignments leading to the client satisfaction. Perfect practice management software thinks about the existing trends of practice, where they are changing, what will be the change and how it will affect the professionals? Moreover, it should bring more and more innovation continuously via constant software updates.
Many firms think they have a handle on where they’re making and losing money, and don’t see the need to keep track of the practice in detail. These firms are often surprised at the marvellous analytics they get into their business when they implement practice management software.
In order to ensure that the practice is running using the optimum resources, it’s important that professional shall be able to answer questions about the type of work, the firm does the best; as well as which employee (intern) is most productive and contributing most in the end. It’s also vital to know which client or client group is the most profitable, as well as that client or client group for which the firm should raise fees or let go.
One area that does not seem to be a focal point of almost all practice management software that they also provide inbuilt functionality for website and blog engine along with full-featured practice management software (except Erience, CPASiteSolutions). Cloud technology and mobility are other areas that have not seen wide adoption in the practice management software. Though some software developer companies are slowly shifting to a cloud-based model, the approach varies greatly from each company.
I’m hoping that in the times to come the practice management software will play the vital role in any organization.
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