Accounting tech vendors placing added strain on practices, experts say

Accountants in practice are increasingly feeling the strain of dealing with clients’ tech enquiries on behalf of cloud software providers, market participants have said.

This is a by-product of the supply chain relationship that fundamentally exists between vendors, accountants and end users, according to Ian Pay, head of data analytics and tech at the ICAEW.

“The vendors are contracted with the accounting firms, but actually the people using the software are the firms’ own clients,” he says.

“So there’s a reluctance for the vendors to engage directly with the end users at the bottom of the chain. The vendor doesn’t see them as a customer.”

This is echoed by Anoop Rehal, partner at mid-market accounting firm Haines Watts, who says that accountants almost act as “salespeople” for cloud technology.

“Clients aren’t the ones pushing us for cloud – it’s the other way around. And that’s fine because in a lot of cases, it’s a great revenue generator for accountants.”

Because of this, the end user’s natural inclination is to approach the accountant with the rationale of “you sold this to me”, Rehal adds.

Online resources a “huge” factor

Pay goes on to argue that tech vendors can significantly reduce the burden on accountants by enabling end users to “answer their own questions” with a base of online resources.

“A lot of vendors have these [resources], but they can be a bit difficult to navigate, especially if you’re not particularly a technology specialist”, he states.

“So even if vendors are reluctant to engage directly with end users, they should still be able to provide access to a good base of online materials that are accessible for non-technical users. That can make a huge difference.”

But for Rehal, vendors must go further and offer more direct, traditional forms of customer support, adding that he is “very reliant” on the support offered to clients by his favoured cloud providers.

“A lot of smaller tech vendors, in particular, will argue that they’ve got a whole load of training videos and resources, but no one wants to put themselves through that. That’s a lot of time to spend on such a small product.”

Similarly, Pay acknowledges a “mirror to wider trends around how people want customer service to be delivered”, noting that vendors are likely to build greater brand loyalty over time with a more personal service.

“I think the tech vendors who recognise that supply chain and recognise that you build better loyalty if you’re more willing to engage with the end users – those vendors do well.”

Tech-savvy talent getting ‘snapped up’

Pay also stresses that there is no silver bullet to resolving this dynamic, and that accountants must also play their part by engaging with technology training more and building that core knowledge.

“If you are finding that you clients are asking you questions about technology that you don’t know the answers to, then there might be a need to look internally and take stock of whether your internal view of on technology is quite keeping pace with what your clients are expecting.”

Rehal echoes this, arguing that mid to lower-tier accounting firms in particular “should probably think a bit more” about data analysis and computer science skillsets.

However, he goes on to note that because vendors are trying to push accounting firms to build up their tech skills, this creates a secondary problem of “having to constantly replace that talent pool”.

“There aren’t many tech savvy accountants out there right now, so they’re getting snapped up. There’s a big talent and knowledge gap.”

A dearth of digital skills appears to be afflicting numerous key sectors, with CIMA’s 2020 Mind the Skills Gap survey finding that 42% of employers still report deficits in skills such as e-commerce, coding, data analytics, cybersecurity, and cloud computing.

Similarly, according to recent research from UK Finance, almost of a third (30%) of financial services professionals said they are lacking in technological skills.

‘A lot of pressure’

This additional strain links to a wider, topical piece around declining mental health in the UK accounting industry, Pay argues.

“There’s a very human element where if someone asks you a question that you don’t know the answer to, that feels very anxiety inducing and stressful for a lot of people.

“That can put a lot of pressure on accountants and impact their ability to focus on delivery.”

Similarly, Rehal notes the potential financial strain placed on smaller firms as a result of having to deal with clients’ tech enquiries, pointing out that accountants tend not to factor that into the cost of their services.

“The burden of that training element has now been put on the accountant more than ever before, and they have to find a way to monetise that,” he adds.

New research conducted by caba, a mental health charity for the ICAEW community, has highlighted the link between the economic downturn and accountants’ mental health.

The study found that more than two in five (42%) working accountants and students are struggling financially. Of that number, two thirds (66%) feel anxious, while three in five (59%) are stressed and a third (34%) are depressed, the study found.

Rehal goes on to link this back to the talent and skills gap, arguing that the additional strain is intensified for firms lacking the requisite capabilities.

“I think it can be quite detrimental – there is a big talent and knowledge gap, and firms just aren’t geared up for it”, he says.

“That’s the pressure that suppliers put on accountants. They don’t do enough to give that support or instill that confidence.”