Accounting firms that find themselves profitable, but seemingly unable to grow at the rate they’re reaching for, should take an inventory into why they hit these plateaus. Bloating overhead is a common cause of slow growth, and the use of manual processes could be what’s dragging down your profitability.
Overhead is part of running a business, however, it can quickly get out of control and become more and more of a primary expense to the company. Manual processes contribute to overhead costs, especially as the company grows.
Unlike operating expenses, a business can’t easily adjust overhead expenses in accordance with their revenue. Overhead is primarily static and has to be paid regardless of where the business’s revenue stands.
Overhead on the administrative side may seem cut-and-dried, but businesses need to consider what expenses are actively contributing to the growth of the company and which ones are more of an obligation. Even if revenue is growing, overhead inevitably balloons with it. More clients mean more accounting work. More clients mean more payroll documentation. As these areas grow, powered only by manual processes, it requires more digital documents and their associated tasks, along with more salaried positions to take on the processes, and more IT support.
Manual processes just take up more resources, with two important factors for dealing with these.
A big step that businesses need to consider is taking a leap into going paperless—in the right way. Most organizations, especially business accounting firms dealing with an excessive amount of client documentation, have accepted the idea of digital documents with open arms.
The key is that not every digital document is created equally. Digital documents that are not intelligently organized or contain usable data are hardly better than physical documents because they run into many of the same problems.
With the right digital documents, certain processes can be done instantly and automatically. Simple tasks such as filing away a document into the filing cabinet and then retrieving it at a later date are rendered near-instantaneous thanks to smart digital filing systems. Additionally, these digital documents can all be accessed in a centralized location instead of spread out between multiple platforms.
Clients who call to ask for documents no longer have to wait for you to retrieve them. Rather than several minutes to find a specific form, it can just take a few seconds.
Document management systems, powered with technology like optical character recognition (OCR) make the tasks of filing and retrieving documents even more simplified.
Accounting firms that dedicate themselves to a paperless environment are inevitably able to phase out expenses such as paper, filing cabinets, storage costs, and the labor hours that go into filing. However, digital documents still have an even greater value.
With your documents in a digital space, automation can take hold and streamline even more tasks. Certain paperwork processes that require review and approval from multiple individuals can now be subject to automated processes that require a minimal amount of user input so jobs get done faster. Intelligent systems can perform menial and complex tasks.
Document management automation tools have become so impressive, that all it takes is simply uploading a single document (a client’s expense report, for example), and the system will have everything it needs to make sure it goes to the right people for approval, to the appropriate folder in the system, and marked with compliant permission and retention settings.
This cuts out the time-consuming tasks of categorizing a file like:
- Manual data extraction,
- Reviewing for human error
- Determining what approvals it needs
- Finding where to archive it
- Consistently ensuring compliance throughout the document’s lifetime
This is vital for businesses looking to cut overhead because it eliminates the need for redundant, manual processes that take up so many labor hours. Not only are accounting professionals now able to clear more time to directly work on their clients’ accounts, but everyone else in the office can also get back to doing more meaningful work that contributes to growth, and not overhead.
Rubex by eFileCabinet is a document management system that can help your accounting firm cut down on overhead and resume positive growth. If you’re ready to cut down on your overhead, let’s talk.