Firms Are Preparing for New Technologies.
If you’re like many firms, you’ve leveraged technology to automate and gain greater efficiency for what used to be very manual and paper-based processes. This is the easy way to handle change because you really didn’t change anything at all. Instead, you just digitized your existing process to suit your needs. But remember, paperless does not equate to future-ready.
Future-ready firms are paying attention to disruptive technologies like Artificial Intelligence (AI) and blockchain to discover ways to create new value for their clients.
Blockchain, the machine behind Bitcoin and other cryptocurrencies is turning the business world on its head. This new phenomenom, will surely impact the accounting world also. According to a 2016 Deloitte survey, over 25% of 308 US senior executives with companies of $500M or more in revenue said that blockchain was a top five priority for 2017. Furthermore, 24% of those executives in the financial services sector planned to deploy some form of the technology in 2017.
But what is blockchain?
Simply put, blockchain is a continuously growing list of records, or blocks, where each block contains a hash pointer as a link to a previous block. These blocks each contain a timestamp and transaction data. Block transactions are then recorded in a general ledger. Next, this ledger is distributed among a vast network of computers that update and reconcile transactions constantly. In such a decentralized environment, it is near impossible to alter or falsify the data in blockchains.
What does this mean for the accounting industry?
Blockchain is a valuable tool for accounting firms, in that it makes transactional data readily available and verifiable. This helps in automating manual processes and creating an easily traceable asset management process. As a result, these improvements help to reduce time intensive labor and allow firms to focus on higher value work, which in turn, increases profitability.
To truly be future-ready, your firm has to think as an advisor. It’s not necessary that you become a technology expert. But it’s important for you to discuss blockchain and other emerging technologies with your clients, as well as understand its implications for your own business. In conclusion, with a future-ready focus you are setting yourself up for success today, tomorrow, and beyond.