The CCH Acounting Trends survey conducted towards the end of last year showed that the greatest factor driving change in firms is the need to increase revenue and reduce cost  through productivity and efficiency improvements. Improving processes and workflows, going paperless, outsourcing and smartsourcing, on demand applications are some of the hot strategies being looked at as potential drivers. 

Mike Braun, the Intacct CEO has this to say "Cloud-based accounting applications dramatically improve the economic model for client accounting services. CPA firms report a 50% improvement in financial performance for their client accounting services practice. Here’s the breakdown: 100% increase in proactive consulting hours; 3% to 5% increase in overall billings by offering more, higher value “trusted advisor services;” 10% capacity increase for accounting staff; time savings of 50 hours per bookkeeper per quarter; and a near total elimination of in-house IT expenses" 

The real breakthrough is when firms learn to leverage combinations of some of the strategies mentioned earlier, as suits them best. For example, you can select the cloud based application that best suits your business model and workflows. From there, you can smartsource - or in other words design your workflow to take advantage of remote engagement. It matters little to the cloud application whether your accountant is working from his office, home or even from another country. The key here is how you design your solution. We have collaborated with some of our clients in designing  solutions for them with good results.  If you are ready to consider this for your business, contact us and we will be happy to serve you

Introduction of Performance management systems in Small and Medium businesses has often been contentious. While these businesses boast of loyalties promoted by trust and relationship, the challenge has been with infusing professionalism and objectivity. 

However, when accounting and bookkeeping or other corporate finance functions are smartsourced (The key to SmartSourcing: Team and Workflow Design) to ThomasandAlex, it presents a wonderful opportunity to introduce a highly objective system that focuses on throughput and productivity. The supersensitivity for cost and value has been set forever by the recession. Management by productivity and throughput becomes the key lever for regulating cost and value. This is an essential competitive advantage that small and medium businesses can no longer ignore. 

The productivity tracking system is set up together with the customer and pricing is calibrated to this system. From our experience we have found that it is best for the system to evolve through these stages. 

1. To keep the risks low initially for the customer, engagement begins with a dedicated resource on a full time or part-time equivalent basis
2. Workflow definitions are achieved and transition of processes to this accountant completes
3. A productivity system is set up for these processes. Throughput measures are outcome focussed and typical measures would be transaction volumes, quantity and type of documents  processed etc.
4. Baselines are marked for current processes as well as other potential processes that can be smartsourced. These are based on measurements agreed jointly with the customer.
5. From this point onwards, scalability of engagement is on the basis of productivity. 

When ThomasandAlex began its services, the core of the value proposition lay in providing bookkeeping and accounting services with an edge. Being trusted with the upkeep of books of the business also gave the privilege to examine improvement opportunities in business operations. But how does a qualified accountant get empowered to provide services with such an edge? These recent initiatives have greatly helped:

1. Business process mapping and Business Analysis:
   
2. Productivity and Quality Assurance framework
3. Technology solutions that take advantage of SaaS and PaaS

As an outsourced services provider, I always had professed my faith in remote engagement. My moment of truth came however when Pujarini, my webmaster and key person on marketing, had to relocate to another country. We decided that it was time now for us to walk the talk on a strategic function such as marketing. Based on my experience, here are few points that I think are critical to the success of any remotely engaged service.

1. Throughput over Activity. Most managers I have come across are comfortable tracking, monitoring and reporting activity. It is good to remember that value is communicated much better when throughput and not activity is reported. When everybody is comfortable with the throughput idea, the reason to micro manage ceases to exist. As throughput gets standardized, its helps build confidence and trust across the board.
2. Environment over Application. The lesson to be learnt here is well taught by social media based networking. The joy off remote engagement is truly enhanced by the environment that is set up. It is ideal to have a single dashboard that serves as the interface to all the stakeholders that are engaging remotely.SaaS and Cloud basedapplications have much to offer in this space as we keep discovering with both clients and our own team.
   
3. Shared Values over Contract. The Satyams and Madoffs will continue to happen in spite of the Enrons and the Worldcoms and the answer is not more and more regulation. Rather, it is more fundamental and vital to upfront ensure that certain shared values govern the relationship and this is well understood by all stakeholders. It also pays to go beyond the agreements to comply and examine demonstrated behavior in these areas. 

In the past, enterprises have leveraged the advantages of outsourcing and offshore processing centers. Entry barriers have been high in this space for smaller companies owing to the initial investments in setting up proprietary environments and training cross cultural workforce.

The advent of SaaS applications and Cloud Based Workflows has thrown open the advantages of Platform Driven Services to the medium sized and small businesses. Without the need for upfront heavy investments, you can set up an environment that suits your workflows.  Then you can get to choose between engaging an on-premise team or a remote team or even a combination of the two, based on your assessment of risks and cost advantages.

We (www.thomasandalex.com ) have been increasingly impressed with the benefits from our experience with customers, moving them from a traditional VPN (Virtual Private Network) based services delivery model to a cloud based delivery model. This has also been the inspiration behind launching our latest offering - On demand Accounts Payable Solution (www.stylusap.com)