As data becomes the new gold, the people who work with data need to become more able and better at conveying insights to their various stakeholders i.e. clients and decision makers.
Accountants and accounting professionals in small to medium practices in particular, need to be able to learn how to read and interpret their own internal flow of information (known as ‘data’- big or small) and be able to leverage the way they communicate their insights to clients effectively.
Thinking about the term ‘big data’, it can be a bit overwhelming so forget that. It might be worth ditching the name anyway, as in its raw form, all data is just ‘dumb’ data, no matter how much of it you have, if you aren’t being smart with it.
“Joe Rospars, co-founder and CEO of Blue State Digital, the agency behind both of Obama’s campaigns, says harnessing the power of big data is not about simply analysing antiseptic information, it’s about using whatever information is at your disposal to understand the people behind it all. “Smart data is about having an understanding of what your relationship is with your clients and the people most important to you and an awareness of the potential in that relationship””.
Begin inside your practice
The first step in being smart with your data is taking a look inside your practice and conducting risk forecasting. You should evaluate the vast amount of data your practice generates and captures e.g. overheads, financials, client data and external sources, to identify potential risks. This can help create a holistic and comprehensive picture of your practice to remain profitable but also, potentially find the lowest-risk options for investments and new service offerings.
To be successful you could consider:
- API tools to consolidate all of your data on to one platform for easier analysis e.g. Power BI.
- Reliable external data sources to find correlations between your practice and industry data.
- Using intelligent integration packs which produce sophisticated data models.
Delivering smart data to your clients
Imagine an accountant presenting their client with an end-of-month report highlighting top-line figures. Great, it’s what they asked for, but what did they actually learn from it? What action or business decisions can they make to drive greater results next month? If the accountant presented their client with ‘smart data’, it would instead identify trends and highlight opportunities that perhaps the client was not aware of. This could also be an opportunity to offer further advisory services.
Now think about your practice for a minute. Your clients may approach you with several business questions like: Which customers and products are profitable? And why? I’d like to open another store, but where? Well, all of the answers can be found within the data you work with each day. Meaning, you have the potential to make their data smart and provide actionable insight.
Here are some keys ways you and your business can work to utilise data in a more effective way:
- Work out what business problems you are trying to solve. What are the issues that keep you awake at night?
- Think about what data you need to collect and understand to solve those problems
- Make sure the data you are collecting fuels a change in the way you do business
- Monitor that change to make sure it’s impacting on your business
- Find internal champions to be in charge of making the best use of your smart data - and upskill them
Empower your practice with the tools and training to start translating your big data into smart data.
Visit CA Kairos today.