Small businesses need accounting processes to be fast. But the most efficient way to achieve accounting acceleration could displace a financial professional out of a job.
A new report by B2B software firm Exact says SMEs demand the speed that accounting automation can provide their organizations but aren't exactly pleased with the threat that robotics would replace human talent.
The firm's report, its 2016 SME Barometer Research survey released late last month, found that the top requirement among U.K. SMEs when it comes to their accounting solution is speed. It's no wonder, then, that IT and software improvement are at the top of the list of priorities for small businesses: 37 percent of SMEs said IT and software knowledge is their most pressing issue that needs improvement, over accounting knowledge and communication skills.
Over two-thirds of the firms surveyed said more seamless integration of software is among their top focuses, with 62 percent adding that they are prioritizing nixing paper forms for online ones. These professionals are also seeking to improve mobile and remote access of these software platforms.
On a positive note, Exact found a decline in the use of "spreadsheet accounting" among survey respondents, from 25 percent last year to 20 percent in 2016. The percentage of SMEs entering data online is similarly on the up.
According to Exact, this represents a positive trend in the way U.K. SMEs approach accounting technology.
"Rising demand for information 'now,' combined with advances in technology, mean that accounting is increasingly seen as a commodity," explained Exact General Manager Gavin Fell in a statement. "Accountants that can keep the pace, providing real-time and in-depth business insights for clients, have the best chance."
The problem, Exact pointed out, is that some of this technology may mean that the accountant isn't the one providing this critical information at all.
The Robot Threat
Exact found that less than half of survey respondents say that the threat of "robotization" is overhyped. Further, 23 percent said high degrees of automation can pose a major threat to their jobs. But automation's threat isn't just to human accountants: Researchers also found that SMEs are concerned about the ability for automated solutions to get the job done, with 10 percent agreeing that they would not trust a robot with their accounting.
Researchers agreed that "robotization" is a key buzzword for small business accounting trends next year and beyond.
The threat of robotization on human accounting jobs isn't a new phenomenon. But the consensus among analysts seems to be that human accountants and other financial professionals shouldn't be too concerned about losing their posts to a machine.
Accounting, consulting and advisory firm BDO told PYMNTS earlier this year that, while it's true many of the manual processes of accountants are likely to be replaced by robots that can do the job more accurately and quickly, human accountants will "absolutely" still be needed.
"It's one thing to talk about the aggregation of data," said BDO Partner Kelly Johnson. "But it's another thing to talk about what drives the success of a business."
While SMEs aren't exactly jumping at the opportunity to have a robot handle their accounting, it hasn't stopped these companies from adopting more automated technologies for this area.
The report found that there is evidence small businesses are turning to a digital-first business model to support their growth efforts. For U.K. small businesses, 45 percent of accountants said they use online solutions for administrative purposes — the second-highest level across European geographies surveyed by Exact, behind only the Netherlands.
U.K. small businesses have also nearly doubled their use of a single end-to-end software tool that connects back-end and front-end processes for accounting since last year. Exact concluded that this has led to a decline in admin time and helped SMEs become more flexible.