From the blog

How Can You Tell If You’re Running a Truly ‘Cloud-First’ Accounting Firm?

We’re rapidly approaching the point where nearly all traditional accounting firms are operating some part of their business in the cloud, or are at least planning to do so soon. And we know there are a growing number of “cloud-only” firms that operate exclusively through web-based software, many of which don’t have a physical office.

But there exists a surging third category between “traditional with some cloud” and “cloud-only” that’s become difficult to define: the “cloud-first” firm. These firms perform most of their work in the cloud, but haven’t completely eschewed traditional practices. They may even *gasp* work offline at times.

So as you move more of your functions and services into the cloud, how do you know when you’ve crossed over into this ill-defined middle group? To put it bluntly, at what point can you start telling clients you’re a cloud-first firm without lying through your teeth?

We chatted with two cloud accounting experts to help shed some light on this, er, cloudy issue. And here’s what we found.

Where’s the threshold?

Five years from now, will there be a specific benchmark you can hark back to and say, “There. That was the moment we became a cloud-first firm.”?

Well, probably not. But David Emmerman, Partner, Emmerman, Boyle & Associates, LLC, identifies a fairly concrete milestone that should help you in your quest for cloud self-identification.

“One question I like to ask is: ‘Should there be some natural disaster that drops on your office alone, how long will it be until you’re up and running again?’” Emmerman says. “If the answer is something akin to ‘under an hour if there is an Apple Store nearby,’ you’re probably a cloud-first firm.”

As you measure your own firm’s ‘cloud-ness,’ you may come to realize you’re not quite sure how many applications you currently have running in the cloud. If that’s the case, don’t worry– you’re far from alone.

There’s actually a tremendous gap between the number of applications the IT pros at most businesses say they have in the cloud and the number that are actually up there. A 2014 report from the Cloud Security Alliance showed that 87 percent of IT professionals believe their company has 50 or fewer applications in the cloud, while vendors report that the average enterprise is running over 500 cloud applications.

With that kind of gap between cloud perception and reality, declaring your business a cloud-first firm becomes even more complicated.

Perhaps the answer then is less about measuring your cloud presence and more about analyzing your overall cloud philosophy. Trevor McCandless, President, Fusion CPA, says that while a single benchmark is difficult to identify, operational and ideological changes within the firm are the best indicators of a true cloud-first transition.

“Are you holding board meetings in person or via Zoom video conferencing? Are your internal work papers in a binder or on a cloud based server? If your team has stacks and stacks of paper all over the place, you’re very likely a traditional firm,” McCandless says.

Check the tech

Running a cloud-first firm inherently requires a level of technological sophistication. But how advanced does your technology need to be before you can claim the cloud-first mantle? Is it ok to just have a few apps accessible through web-based portals, or do you need Skynet-level AI approaching apocalyptic self-awareness?

For Emmerman, the answer is much more the former–widespread browser access is key.

“In a cloud-first firm, most applications are launched from a browser versus some icon on the desktop. So we transition from the desktop and application icons to bookmarks within a browser,” he said.

McCandless’s opinion skews more towards the latter–minus the destruction of all mankind. He describes a cloud-first firm as one that has “best-in-class” technology, where employees are “power users” of anywhere from 10 to 20 cloud platforms.

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Model behavior

To take full advantage of new cloud platforms, many firms must rethink their business and staffing model to match the capabilities (and limitations) of the technology. So what exactly does a cloud-first business model look like?  

A 2016 report from Karbon breaks cloud accounting services into four categories:

  • Client services (Client facing)
  • Client management (Client facing)
  • Communication (Practice facing)
  • Practice management (Practice facing)

A business model with a dedicated staff and manager for each of those four offerings seems to make sense, but don’t be alarmed if you’re not there yet–we’re talking Platonic ideals here, not reality. You can still be a cloud-first firm even if your staffing model only addresses these four concepts in theory, but not in practice.

Emmerman would certainly shy away from forcing your firm to fit into these four boxes. For him, an ideal cloud business model is all about flexibility.

“I think of the business model as being much leaner than a traditional practice,” Emmerman says. “A cloud-focused firm does not feel as encumbered by the walls and silos that the traditional firms feel. From the way that they approach meetings and hiring to the way they incorporate stakeholders into firm decision making, cloud-first firms tend to be much more agile.”

McCandless, in stark contrast with the Karbon study and Emmerman, doesn’t see a major need to rethink the core business model.

“If managed correctly, most service-based business models in our industry should look somewhat similar,” McCandless says. “Where any company sets themselves apart is how they invest in their future. For us the focus is talent and technology. These investment pools are what will determine our future success.”

A day in the life of a cloud-first accountant

So how does moving to a cloud-first practice impact the day-to-day duties of employees? According to Emmerman, it doesn’t–at least not much.

“I don’t see the duties and responsibilities change drastically other than there should be much more crossover of roles,” Emmerman says. “Much less admin roles in day-to-day tasks, as the admin tasks that we traditionally think of start getting replaced by applications. The admin roles then start shifting to being more client-facing and client management related.”

McCandless tends to agree.

“The duties and responsibilities of employees and team members at Fusion CPA are similar across the board,” McCandless says. “That is to support our vision, which is to create a foundation, environment, and culture wherein CPAs and our entrepreneurial clients thrive together.”

Who’s on cloud-first?

At the end of the day, it’s really up to you how you want to identify your firm. There’s no set benchmark that separates a cloud-first firm from a cloud-sometimes one, so feel free to advertise yourself however you’d like. But hopefully this blog has given you some clarity into how far along you are in your cloud journey, enabling you to self-assess past and future milestones that might mark your firm as “cloud-a-little,” “cloud-a-lot,” “cloud-first,” or “cloud only.”

Whatever label you want to apply to your firm, one thing is clear–fulfilling your cloud goals won’t be possible without the right talent at your side. That’s where Accountingfly comes in. Connect with us now to start recruiting the best cloud accountants on the market.

Let’s talk about about your recruiting needs.

Want to learn more about how Accountingfly helps you recruit the best accounting talent? Schedule a free 30-minute call with us to see what we’re all about.

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