The Rise of the Digital CPA Harnessing the Power of the Cloud

presented byGregory L. LaFollette, CPA.CITP, CGMA

Strategic Advisor

Gregory L. LaFollette, CPA, CITP, CGMA

Semi-Retired Vice President of product strategy – CPA2BizAuthor, Speaker, Thought-leader, Accounting Technology Hall of Fame MemberFormer

• Eide Bailly, LLP – Senior Manager, Tax and Technology Consulting (6 years)• LaFollette Consulting, LLP -- Consultant to the industry (12 years)• The CPA Practice Advisor -- Executive Editor (6 years)• Thomson Reuters (Creative Solutions) -- Vice President - Product Strategy (5 years)• LaFollette, Jansa, Brandt & Co. , LLP -- Tax & Technology partner (23 years)

• AICPA Committees• Journal of Accountancy – Technology Advisory Board• Prior Service:

– CITP Credential Committee – Chair (7 years; Member 4, Chair 3)– TECH+/Practitioners Conference -- Planning Committee (6 years)– National Accreditation Commission – ad hoc (3 years)– National Tax Education Program (AICPA/UI) -- Graduate and former Staff Lecturer (12 years)– Top 10 Technology Initiatives -- Review Committee (5 years)– Microcomputer Advisory Services Committee (3 years)

Who we Are / What We Do

How we Got to Where we Are

Whitepaper

Agenda

Who we Are

About CPA2Biz AICPA subsidiary, Formed in 2001

Markets all AICPA products and services, manages AICPA affinity programs, manages

AICPA web properties and leads key AICPA technology initiatives

AICPA Store (www.cpa2biz.com) is ranked by Internet Retailer as one of the Top 500 e-

commerce sites in the US.

Built one of the leading distribution channels to the profession through its Trusted

Business Advisor Solutions program—a portfolio of web-based solutions, training,

resources, and alliance programs transforming the CPA-client relationship.

Headquartered in New York, NY with technology and engineering offices in Santa Clara,

CA, sales office in Dexter, MI, and service and support offices in Durham, NC.

Overarching Principle

We are the leader in guiding the profession’s migration to the cloud through change management, business process education and product and service curation.

How we Got to Where we Are

Painful Changes

1965 - 1975

All manual to Service Bureaus

1975 - 1985

Service Bureau to

Mini-computers

1985 – 1995

Mini’s to Micro’s

1995 - 2005

DOS to Windows

2005 – 2015

Premise-based to

SaaS

Why it Works

CPA2Biz

Tax & Accounting Executive RoundtableThis exclusive CEO-level event is unlike any other. Hosted by CPA2Biz and the AICPA, the event brings together America's top:

• thought leaders• financial minds• SaaS entrepreneurs• government regulators• leadership from top accounting firms• State CPA Societies• and respected journalists...

to address the accounting profession's "move to the cloud."

SOLD OUT

New York, NY - January 28-29, 2014

Digital CPA Conference

Geoffrey Moore

Whitepaper Released

APPS

http://www.cpa.com/conference

Three Mega-trends

Digitization Virtualization Transformation

Digital Disruption in Accounting

• Digitization– From Paper to Paperless– Cloud Computing– Overcoming barriers of productivity

• Virtualization– From Physically Present to Digitally Present– Systems of Engagement– Overcoming barriers of location

• Transformation– From compliance vendor to trusted advisor– Business Intelligence– Overcoming barriers of commoditization

Three Mega-Trends that Matter

Necessary EvilEstablishing the Practice

Expanding the Practice Deepening

the Practice

The Evolution of Accounting Services

Stage 1 - Necessary Evil

•Paper intensive, Place specificDefining Characteristic

•Courtesy to clients, no riskReason to Do•Lack of profitability, digital disruption Reason to Move On

•Migrate IT systems to the CloudInvestment Required

Stage 2 - Establishing the Practice

•Paperless workflowsDefining Characteristic

•Profitable business modelReason to Do

•Desire to growReason to Move On

•Online Systems of EngagementInvestment Required

Stage 3 - Expanding the Practice•Online communication & collaborationDefining Characteristic

•Reach & frequency of service deliveryReason to Do•Expand into higher margin servicesReason to Move On

•Business IntelligenceInvestment Required

Stage 4 - Deepening the Practice

•Trusted advisor statusDefining Characteristic

•High-margin project workReason to Do

•Expand into new target marketsReason to Move On

•New target market initiativeInvestment Required

The Evolution of a Practice

A Necessary Evil

A Viable Practice

A High-Growth Practice

A High-Value Practice

Targ

et M

arke

t Foc

us

Digitization

Virtualization

Transformation

Is Your Firm Trapped in the Pull of the Past?

PULL OF THE PAST

• Paper Checks

• Mailing Lists

• Phone Trees

• Phone Calls

• Email

• Voicemail

• Attached Files

• Text Documents

• PowerPoint

• Spreadsheet

• Desktops

• Org Charts

• Published Reports

• Conferences

THE CALL OF THE FUTURE

• Online Bill Payment

• Twitter

• Facetime

• Skype

• Texting

• Presence Detection

• Cloud Sharing

• Images, Video

• YouTube

• Events

• Apps

• Tablets

• Social Graphics

• Shared Content

Automation

Commoditization

DifferentiationSpecialization

Optimization

21st Century Darwinian Dynamics

Why Target Market Focus?• Clients aggregate into market segments

– Communities with shared interests – Self-organized around industry, geography, & profession– Who talk to each other before making buying decisions

• Two lessons from Marketing 101– Cost-effective growth is impossible without target market focus– Tipping point dynamics accelerate your success

• Target marketing success factors– Participate in the segment’s relationship network– Develop domain expertise relevant to the segment– Over-deliver to create strong reference accounts– Encourage word-of-mouth referrals

Action Plan• Select a target market focus

– Big enough to matter– Small enough to lead– Good fit with your skills and interests

• Create “new client” onboarding– Paperless standard– Systems of record in the cloud– Document exchanges in the cloud– Other facilities as needed

• Migrate existing clients opportunistically– Take the early adopters when they are ready– Eventually end-of-life paper-based services

Evolving CAS: Change ManagementWhen and How will You Make the Transition?

Inno

vato

rsEar

ly Ado

pter

s

(Visi

onar

ies)

Early

Maj

ority

(Pra

gmat

ists)

Late

Maj

ority

(Con

serv

ative

s)

Lagg

ards

CHASM

EARLYMARKET

TORNADO

MAINSTREET

Three Proven Approaches• Visionary

– Go ahead of the herd for competitive advantage– Spend big to secure top-notch team & great support– Drive change from the top down

• Pragmatist– Go with the herd to reduce risk– Spend moderately to secure market-leading solutions– Manage change around specific use cases & bellwether teams

• Conservative– Go after the herd to reduce cost– Spend frugally to secure basic services– Manage change around vendor-led training sessions

No right answer—your call

Wrapping Up• Model for Evolving a CAS Practice

– A Necessary Evil– A Profitable Practice– A High-Growth Practice– A High-Value Practice

• Enabling Technology Investments– Digitization– Virtualization– Transformation

• Change Management Strategy– Visionary– Pragmatist– Conservative

Resources at www.CPA.com

REMEMBER

“CLOUD ACCOUNTING”

WILL SOON BECOME

REMEMBER

REMEMBER

“ACCOUNTING”

Thank You!!!