In their report ‘Where machines could replace humans—and where they can’t (yet)’ the consulting firm McKinsey & Company looked at the extent to which human activity in the workplace could be replaced by automation.
The somewhat sobering results are shown below. E.g. anyone involved in Data Collection and Data Processing can expect to lose two thirds of the time spent on those tasks to automation.
For those not quite convinced.
Predictable physical work in a car plant 10 years ago.
Predictable physical work in a car plant today. (Can you spot the two people in this photograph?)
Some other professions are also facing the same transition in work practices. The outsourced Accounting Firm may be one of them. It is threatened not only by automation but by the client themselves, as DIY Accounting programs such as ‘QuickBooks’ become more popular. And it is under threat from certain authorities. E.g. HMRC who want to gain direct access to company databases and records making the need for tax returns a thing of the past.
As these unstoppable forces take hold Accountants will experience a decline in two critical areas – their income, and their relevance to their client. How do you stay relevant when many of the tasks that allow deep insight into a client’s business are being taken away?
This might be just another story about a profession falling victim to unstoppable change.
However, a huge opportunity is presenting itself. Yes, clients may be seeing less and less relevance in the more traditional accounting services that they have received.
But they are increasingly thirsty for intelligence that will help them to drive their business forward. This might be a simple insight into their customers’ buying habits. Or a heads up about a specific risk heading in from left field.
They want this information because they are increasingly aware of the growing volumes of data becoming available to them. This is data from within their own business and from outside, with the potential to yield valuable intelligence that will help them to grow.
Trouble is, they don’t have the means to get it. Their own people don’t have the skills. And those with the right skills cost a fortune to hire.
Yet, this demand for information is only going to grow. The government has made a vast amount of data available about all our towns and cities and the people who live within them.
All the major cities across the UK have plans to become smart cities and amass extraordinary amounts of data that will be available to the public.
The Internet of Things is about to explode into life as low power communications networks spread across the country providing means for zillions of sensors and detectors to collect data.
All those businesses who could use this data to create relevant and timely information just need someone who already knows their business to show them what’s possible, what it could be worth, how to go about it, and where to go for help.
Accountants might not see this to be something that is for them. But if they want to, they can play a pivotal role in helping their clients grow within the new digital age.
They are already uniquely equipped in three key areas. They know their clients, they do numbers, and they know how to explain to clients what their numbers mean.
The element that may be missing for many is the ability to build business intelligence out of data.
But those skills can be acquired. And if they are, the size of the win win that will follow will be substantial.
The relationship between client and Accountant can be transformed, and the Accountant’s position as a trusted, knowledgeable and highly relevant strategic advisor will continue to be secure.
And all those client businesses will have their eyes opened to the opportunities available to them for better business intelligence, strengthening their ability to trade in an increasing digital world.
Executive Vice President, Academics
Charted Institute of Management Accounting
from his presentation ‘The Future of Finance’.