What I want to share in this article, is my perhaps radical perspective for young accountants, not necessarily young in age, but young in their careers. Those just out of school, or maybe in the first few years of their careers, particularly entrepreneurial accountants. These accountants are working for entrepreneurs or for growth organizations and wearing many hats. If this is you, I commend you and your work. First of all, because I think you’re doing the right things in terms of having many roles to play, and secondly, I think that this is the right path and the future for our profession.
In my opinion we’re entering an era of accounting superstars which sounds great if you’re an accountant or studying accounting, but as I’ll explain, it’s not necessarily that good for the variety of the workforce that does accounting related work for a living. We are entering an age where there is a much more narrow range of abilities, that will have work in the accounting profession. Historically in the accounting profession there has been a pretty wide range of work starting with the entry and manipulation of data. This is of course related to the accounting function, but these entry specialists have not necessarily even needed to understand accounting in any great detail to do their work. Many of you reading, may find that hard to believe. You may be saying to yourself, “I do something accounting related, of course I understand accounting.” But I stand by my assertion, that there are a lot of people turning numbers out, that don’t really know accounting that well, but are making a living, in an accounting function. The wide range of skills that have found careers in accounting is reflected in the incredible variance in accounting and finance compensation. You can find people whose roles are in accounting and finance making $30,000 a year to people making $300,000 or more in some markets.There is a huge range right now of the kinds of work that you could be doing and compensation you could be making in an accounting function.
This is what I believe will change as a result of technology. There is a trend in almost all areas, where we are seeing technology take over a lot of clerical work, and this will push those doing data entry functions to enhance their knowledge, creating deeper and more varied analytical skill sets. Or they will leave. That’s why I say we are entering an era of superstars, because I think we’re going to have a much narrower field where human accountants are being deployed. I don’t know what exact skills will define a superstar, but my guess is that they will be analytical in nature, system oriented, and have an aptitude for interpreting complex rules in the “corner cases,” that haven’t been solved by generalized artificial intelligence algorithms.
A “winner takes all,” future for the professions has been described in technologist literature. Translated into the accounting profession, such a scenario might be super knowledgeable accountants, who know a lot about systems, tax laws, accounting standards, financial theory and operations that are ultimately going to be the only accountants with long-term careers. As opposed to the diverse work force the profession now supports with varied levels of skill and ability. That’s why I started referring to the entrepreneurial accountants (the ones working with growth organizations that are wearing many hats) as accounting superstars. I consider these folks to be able to cover the field with good analysis and understanding across multiple disciplines.
We can debate whether this prediction is good for the economy, or for society and what that means for income inequality, if you extrapolate that kind of scenario across all professions. But regardless of whether you are eagerly awaiting it or fearing it, I think it’s coming. So, I’m telling my colleagues who are young in the industry not to follow the patterns of the last 30 years. Be more and do more. Don’t become an auditor or a tax preparer, a general ledger accountant or a receivables, payables or payroll specialist. Your best bet is to become very knowledgeable about a wider variety of things and really focus on the tasks that are quite analytical in nature. When I talk to accounting firm colleagues, I’m always talking about the future and what this could mean to their practices, and why they need to focus more on going towards a consulting business and less into a compliance business.
In accounting firms, we’re often trying to standardize things. We’re always trying to make things more efficient, trying to come up with a really good process because this allows us to plug a new person in to do the same thing, in the same way, that the last person did so that we have a very efficient, standardized, well running machine.There are even people who are promoting Lean Six Sigma thinking, to their accounting operations. This seems particularly appropriate if what you’re doing is a compliance function.
Accounting firms look at their well honed processes and think, “We’re going to rock it next year because we figured out a way to standardize that process and make it super efficient.” But here is the thing, If the work you’re doing can be standardized or turned into a process and create this kind of efficiency, that’s the surest sign that you shouldn’t be doing that work in the long run. If you think you’re going to outrun machines and artificial intelligence at standardizing things and being efficient at doing the same thing over and over again, I’m sorry, that’s just crazy.
The low hanging fruit for my critic in this vein are firms that do a lot of individual tax preparation. However the firm’s that are sitting back and saying, “Well, you know, we do business tax returns, so we’re okay,” I say, not for long. It’s certainly going to come your way as well, and it’s also going to come by way of audits. We are already several years into researchers applying machine learning and AI technology to see how they could do some audit and compliance work for public companies in terms of writing disclosures and things of that nature.
So this is my message to the younger accountants: learn as much as you can about a variety of different things that accountants are thought to know about, whether it’s taxes, financial accounting, financial theory, capital markets, banking or anything that you can use to add value to both your career and your organizations. In the process of being more, what I’m advising is to become one of those stars. If I’m right about the profession essentially becoming an assemblage of star accountants, you will presumably want to be one of them. There will be room for you, there will be a lot of stars needed, but their skill set is going to be doing the things that we often think of as being the more complicated work. If I’m wrong… well, you’ll still have quite the career having put that kind of investment into it. In my time as a CPA I’ve had a considerable variety and breadth in my work, I’ve been able to go both wide and deep in very diverse areas. Part of this was because I both practiced in public accounting, and taught at Universities for so many years. Where most professionals learn theory and then get practical, I was able to live and grow up in both worlds for a long time. I feel this gives me unique insight to what’s possible in the future beyond what just is, as of today. I’m seeing a future that is different then the way we have segmented and stratified the profession of accounting and finance.
That’s not to say I really know the future. I can’t say for a fact that this is how it’s going to go. I just have some ideas on what may be coming that I’m sharing here with you so that you can consider building a career that is future ready. That is what I hope for you as an accountant. We can do this together. Let’s all move ourselves to that superstar category, so that we can continue to have great careers and be among those that have a highly valued skill set with a great compensation that allows for a great lifestyle.