5 Metrics to Measure for Peak Performance

Whether it’s cloud-based solutions or predictive analytics, technology is helping firms today enhance their performance outcomes in five key ways: Agility, efficiency, growth, profitability and transformation. In Wolters Kluwer’s 2019 survey of tax and accounting professionals, we found that technology has helped firms the most within the areas of profitability and efficiency, but it is making a difference for a number of metrics across all five areas. Here’s how.

1. Agility

Agile firms are able to recognize and seize new opportunities in a changing landscape. Because client expectations are constantly evolving, firms can leverage technology to meet those ever-changing needs. That might mean, for example, using predictive analytics to be more proactive and consultative, or leveraging technology to improve client response time. In our survey, 82% of respondents felt technology helped reduce average client response time.

Metrics to measure: Average client response time, ability to identify problems (client-staff), RFP win percentage.

2. Efficiency

Efficiency is the ability to accomplish more with existing staff. When firms work smarter not harder, they give employees more time to focus on innovation and client communication—not on mundane tasks. Technology solutions that allow firms to automate tasks mean less time spent per return and fewer extensions filed as a result.

Metrics to measure: Reduction in hours worked per return, reduction in hours worked per client, time spent on core business (versus administrative), reduction in number of extensions files.

3. Growth

Growth can be measured in several ways. These include more new clients, more services per client, and the addition of new service offerings. Of those firms realizing stronger growth outcomes due to technology, 83% felt technology was helping them add new clients. And 68% felt technology was helping them grow the number of services per client. Technology also can help with firm growth by freeing up staff time for better client engagement, which increases your value and positions your firm to offer higher-end consultative services.

Metrics to measure: Add new clients, increase in the number of services per client, add new services.

4. Profitability

To be profitable, a firm has to not only keep its existing clients, but also to earn more from each one by either raising prices, increasing chargeable hours, or increasing realization per client. In other words, technology that makes firms more efficient and agile helps sustain and grow the business over time.

Metrics to measure: Retain more clients, % realization per client, improvements in chargeable hours per client.

5. Transformation

Change is a constant in accounting. The ability to adapt and prepare for the future is an essential component of success. Skillsets are changing and staff now require client communication skills as well as the ability to understand and leverage new technology.

Metrics to measure: Employee skillsets, utilization of solutions implemented, staff engagement/morale.

Data analytics and financial visualization tools set your firm up to provide proactive rather than reactive services. In addition, cloud solutions allow more flexible, remote working opportunities, which leads to improved recruiting efforts and more satisfied employees.

Learn much more about how the way firms are leveraging technology is changing the future of accounting. Downloading the white paper: “The Future of Accounting.”

AUTHOR

Wolters Kluwer Tax and Accounting

Wolters Kluwer Tax and Accounting is a leading provider of software solutions and local expertise that helps tax, accounting, and audit professionals research and navigate complex regulations, comply with legislation, manage their businesses and advise clients with speed, accuracy and efficiency. Wolters Kluwer Tax and Accounting is part of Wolters Kluwer N.V. (AEX: WKL), a global leader in information services and solutions for professionals in the health, tax and accounting, risk and compliance, finance and legal sectors. We help our customers make critical decisions every day by providing expert solutions that combine deep domain knowledge with specialized technology and services. Wolters Kluwer reported 2016 annual revenues of €4.3 billion. The company, headquartered in Alphen aan den Rijn, the Netherlands, serves customers in over 180 countries, maintains operations in over 40 countries and employs 19,000 people worldwide. Wolters Kluwer shares are listed on Euronext Amsterdam (WKL) and are included in the AEX and Euronext 100 indices. Wolters Kluwer has a sponsored Level 1 American Depositary Receipt program. The ADRs are traded on the over-the-counter market in the U.S. (WTKWY).

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