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UK surveys suggest a cloud accounting tipping point

Den Howlett Profile picture for user gonzodaddy November 27, 2013
Are we close to a tipping point where accounting moves to the cloud? Results from different surveys suggest that may be true. But are professionals well aligned? Judge for yourself.

I am usually skeptical of vendor sponsored surveys. Why? They are almost always skewed in such a way to get the results the survey sponsor wants. On this occasion I am less sure. While all the surveys mentioned below are vendor sponsored, they all come at a similar problem from a slightly different angle.

Yesterday for example, I noted that Xero senses a tipping point among practitioners with 55% either using cloud technologies (28%) or planning to do so (27%.) that still leaves 45% with no plans to use cloud tech.

Really Simple Systems paints a similar picture - see image below:

use cloud 2013

When we look at confidence in using cloud technology, the picture is remarkably similar to that painted by Xero:

cloud confidence

That would indicate both business and professionals are fairly well aligned in their approach to cloud technologies. Now compare this with the results of a survey conducted on behalf of Intuit. They have not provided the raw data. This from the email I was sent:

Findings from Intuit’s ‘The Changing Role of Accountancy’ study of 100 accountancy firms and 200 SMB’s across the UK illustrate the urgency for British accountants to move from desktop to cloud-based software or risk losing clients. The research conducted by Coleman Parkes in September and October 2013 on behalf of Intuit UK, highlighted that 40% of SMB’s believe their accountants are far too traditional to move to the cloud and almost two thirds (72%) believe their accountants should update their software to the cloud. This includes being able to service their clients anytime, anywhere and on any device from laptop, tablet and smartphone.

I have a sense of 'no shit Sherlock' about this set of self serving results that Intuit parses to mean:

...the results of ‘The Changing Role of Accountancy’ study which reveals that 88%* of UK small businesses expect their accountants to embrace cloud-based solutions and more than half (58%) are willing to pay more for the privilege. These findings highlight a tremendous gap between the services accountants currently offer their small business clients, and the level of innovation that their clients are demanding.

The 58% number seems to align fairly well with the other survey results while the 40% number is more or less in line with the 45% number Xero found. In fact the 58% number will be one with which new style firms are only too familiar. We pay more than I'd expect for compliance services because our accountants have bundled other services we value.

Where I struggle is in understanding how a sample of 200 businesses translates into "88% of UK small businesses expect..." and especially so given the other data. Similarly, I don't see a 'tremendous gap.'


Rather I see the emergence of a different type of practitioner  who will likely NOT choose one of the incumbent solutions, preferring instead to find something that has been built as a 'cloud first' solution. This is something of a conundrum for vendors like Intuit and one that I see mirrored across all segments of industry. The only segment that remains immune today is the very large enterprise. I suspect it is only a matter of time before that changes and most likely by 2017.

Perceptions have changed. While the incumbent vendors and professionals believe their brand values can carry them through, they are missing the point. Those brands are associated with an 'old order' with all the baggage that goes with it. It should be blindingly obvious to the incumbents that their brand, as a measure of value and trust, is not valued by the 21st century buyer in the same way it was in the last century.

What next? My preference would be to see ICAEW and ACCA undertake surveys designed to elicit attitudes from members. Then we can start to get a better picture.


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