Our report will be published in January. Join our mailing list to be the first to receive a copy. Here is a short introduction to the report.
Professional services firms have a long, and rather conservative, history that has contributed to maintaining reliable, legal and trusted business environments in which companies and other institutions can co-operate and trade freely. From Mesopotamia to Medieval Europe, Pacioli and the formalisation of double-entry bookkeeping, accounting helped people make informed decisions about business and economics, long before the rise of the chartered accountant and modern professional accounting in the Nineteenth Century. Whilst the early history of accounting had seen huge societal shifts, from the rise of settled agriculture, the rise and fall of empires and civilisations, the spread of literacy and the rise of independent companies, the conduct of business in 1980 was arguably not that different from the way business was conducted a century earlier at the foundation of the ICAEW.
But by 1980, the TCP/IP protocol that underpins the internet had already been invented, and after its publication the following year, the foundations of a global internet were laid during the 1980s. Although it may not have been clear at the time, this new network of networks would change business in fundamental ways, and as a result, the digital economy and society it enabled now looks set to disrupt the practice of accounting, arguably in a way that no previous technology since the written word has done. Even the shift from paper to PCs posed less of a challenge to the way accounting is practised – it just replicated documents and ledgers on a screen and helped with the arithmetic – than the thoroughgoing digitisation of business that we see today, the rise of big data, artificial intelligence and new business models.
Some, such as Richard and Daniel Susskind, believe the professions will slowly be automated and commoditised before they fade away to be replaced by intelligent systems, peer-to-peer platforms and other sources of advice and analysis. Others believe the professions will continue, but working in tandem with automation and machines, implying that there will be fewer professionals who focus on high-value-added activities that firms and the people who make them up will continue to need.
Regardless of the eventual future of the profession and practice overall, what do these changes mean for accounting firms themselves? How will they need to adapt, and how can they avoid being dragged into commodity markets where computers have the advantage? How will the future firm differ from what we see today? These were the kinds of question we had in mind when initiating this research.
Most attempts to predict the future begin with their conclusions already in mind, assuming that the future will all be about technology, or culture, or new ways of delivering services. But in a profession that spans all the way from a multitude of sole traders and small firms to 200,000 people behemoths, there is probably no single, simple answer to what the future firm will look like. Also, since accounting firms are not the only sector being disrupted and changed by digitisation, there are lessons to be learned elsewhere in various aspects of a firm’s structure, culture and practice.
The goal of this small project was to come up with a multi-dimensional framework to describe the elements of a firm that we think will be subject to greatest change, and then to discuss these elements with professionals to see which they are most interested in, concerned about and also have a sense of how they might change. By gathering ideas and inputs into the individual elements, we hope to validate the framework and then, if it proves useful as a way of having conversations about change, to make it available to firms to adapt and use in a way that makes sense to their particular culture and view of the future.
As you will see, we got some great input and had some fascinating discussions, and whilst some elements of the framework proved more popular than others, which will help refine it, it seems most of the the key topics on the minds of those we engaged in the project were represented.