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Document, Forms, Content & Knowledge Management

Life can be funny at times. For the past five years or so, those of us who inform, educate and advise accounting professionals have been beating the drum about the virtues of “going paperless.” Well I just returned from a conference of CPA firm IT directors, where I facilitated a panel discussion on electronic document management systems (EDMS).  I was only half surprised to hear a number of the participants complain that despite having implemented an EDMS, they are printing more paper than ever before.  There is nothing like the real world to screw up a good theory!

So what’s the problem?  I think it is as fundamental as understanding the difference between training and education. The objective of training is to teach someone how to do something. In this case how to use technology. Education, on the other hand, is about informing and sharing a base of knowledge for someone to understand an issue, concept, situation or in this case, opportunity.

The primary objective of this article is to educate you on the why, what and how of the current and emerging systems utilized for managing your client and firm information digitally; document, forms, content and knowledge management systems. The goal is to help you develop your road map for pursuing solutions that will help you move your practice forward during this period of rapid change, multi-faceted challenges and abundant opportunities.

WIIFM – What’s in it for me?

Peter Thredgold, a nationally recognized economist, postulated at a CPA leadership conference in Michigan the other day; “People respond to incentive.” Makes sense to me. So, I thought it would be beneficial to open with an explanation of the benefits of using the various information management tools listed in the title.

The 50,000 foot view. Anyone with even the most rudimentary understanding of American History knows that the agricultural revolution was propelled by the deployment of farming machinery and equipment. The industrial revolution that followed was fueled by the deployment of factory machinery and equipment. Today we are in the midst of the information revolution and it is being powered by electronic information tools. If you want to lead your firm to greater success, you will be well advised to strategically embrace these tools.

The 500 foot view.  Let’s focus a little closer to home on the benefits of embracing the various digital information tools we’re discussing. If time and space permitted, I could prepare an extensive list of benefits, but I would like to highlight four key areas where these tools can directly benefit your firm:

1. Productivity & profitability – Take a ten minute break and visualize in your mind’s eye how much activity in your office is devoted to manual and redundant processing of information. How much time is spent gathering and organizing paper documents and electronic files? How much time is spent walking around the office, or the network, looking for information? How many forms are being processed on paper, in Word or Excel documents, with little or no structure or consistency? How much of the data you’re entering in your software applications was originally generated from another computer system or application? How much time is wasted by multiple people researching the same issue without sharing the knowledge?
The effective deployment of these tools will help you improve on all of these inefficiencies and that translates quite simply into increased productivity and profitability.

2. Quality of service – Your clients are facing unprecedented challenges in their business organizations. In order for them to deal with these effectively having the right information at the right time is critical. You have an obligation and an opportunity as their financial and tax advisor to assist them in that pursuit. When you leverage this collective set of digital information tools you will be able to quickly access the relevant information and deliver it in a timely and effective manner. If you continue to keep paper documents and unstructured computer files in your workflows you will find your firm in a foot race with your competitors, with a ball and chain attached to your foot. Clients will become increasingly demanding in their needs for your professional guidance and you can’t afford to be spending time on inefficient processes.

3. Innovation – The more you embrace these tools and transition towards a truly digital practice model you will be positioned to provide innovative services to distinguish your firm from the competition. One prime example of this is the client portal. When you have your information organized digitally you can use the concept of a portal to develop a digital link to your clients for the two way exchange of relevant information in a real time basis. This could start out as simple as posting copies of financial statements, tax returns, etc. and uploading files from clients directly. From there you can focus on providing your clients with real time access to important news and information including KPI (key performance indicators) dashboards, on-line applications and more.

When you establish this digital link to your clients you strengthen the bond your client has to your firm beyond the personal service your team provides. This provides a whole new dimension from which clients will value your firm and that translates into higher market value for your firm, which is on the minds of nearly every firm leader today.

4. Quality of life –  Whether you’re at the end of your career looking to “slow down,” in the middle of your career juggling family and work, or a new professional looking to advance your career without giving up your invaluable leisure time, everyone is looking for opportunities to use their “work time” more effectively.  Document, forms, content and knowledge management tools provide the catalyst to eliminate time spent on wasteful and low value activities and focus on what’s really important to the client and therefore more valuable.  Providing these tools for your staff to maximize their efficiency and effectiveness, while at the same time fostering a flexible working model, will significantly enhance your success at recruiting and retaining quality staff.

I hope you will take a few minutes to ponder the prospects of these benefits for your firm. One of the most critical success factors in the transformation to a digital practice model is to truly understand the benefits. The costs and obstacles associated with going digital can be significant. If you don’t believe in the value of the benefits it will be too easy to let the obstacles push you off the track and that is the most precarious place to be.

The time is now!

Let’s take a minute to review the evolution of accounting technology over the past 30 years to gain a better understanding of where we are positioned today. With the advent of personal computers in the early 1980’s, we spent the next decade focused primarily on the “hardware” and how to get it all to work together via networking. The 1990’s were focused primarily on software applications, with limited integration and flow of information from one application to the next. In the 2000’s the focus has evolved more towards accessing and utilizing the information provided by all of the hardware and software.  We have Google as our window to nearly every piece of information on the globe. The internet lets us share information with anyone, anytime. And “software as a service” is rapidly becoming the predominant model for processing information electronically. The jury’s in; you have to move all of your information and knowledge to digital format and leverage the tools that are available to manage it more effectively, or risk diminishing the value of your firm.

The Solutions

We have identified four key information management tools that should be on your radar, if not already in your workflows. Let’s start with electronic document management systems (EDMS.) This is the core application for “going paperless.” There are two primary roles for the EDMS; converting paper documents into electronic format and managing the organization and access to all of your electronic files. While it is the former feature that gets most of the attention, it is the latter that is more important.  Time is of the essence in every accounting practice today and you can save significant amounts of time by leveraging the benefits of an EDMS. I recently authored a review of CPA centric EDMS solutions that is posted here on The Progressive Accountant, in case you want to learn more about specific solutions.

Forms management software is growing in popularity. As accounting and tax firms implement EDMS solutions they are realizing new possibilities to transform the focus from static documents to interactive documents, or forms. Every firm has a multitude of forms they deal with and they can be classified into two basic categories; data collection forms and workflow forms.

The data collection forms include client documents such as tax forms, transaction source documents, tax organizers, etc. The advent of advanced scanning software has progressed significantly in the past few years. It is now capable of recognizing data on a form and converting it into digital data that can be transferred directly into a software application. The best example of this is the ability to identify wages and compensation on a W-2 form and transfer it into the tax preparation software. The other side of forms software includes applications that let you design and deploy interactive electronic forms to facilitate workflow automation. These include tools like Adobe Acrobat Professional and Microsoft InfoPath. These applications are used to convert your checklists, routing sheets, review notes, transmittal letters and more, to structured forms designed to capture, report and disseminate the data digitally.

Content management software covers a much broader scope of information management.  Think of a content management system (CMS) as an EDMS on steroids. Sorry, it’s baseball season. The CMS is designed to organize all of the different types of digital information (content) that you process in your firm; documents, e-mail messages, v-mail, instant messaging, recorded web conference sessions, video files, podcasts and more.  Just defining the scope of a CMS can be intimidating; however, if you establish a long-range content management strategy you will be able to develop your CMS on an evolutionary model. Your CMS will most likely consist of multiple applications that you integrate; EDMS, workflow, portal, e-mail, instant messaging, web conference software and more. To the extent you can get these applications from the same vendor that will be a positive in regards to integration, which is what CMS is all about. However, this is an application where “best of breed” will typically rule and you will have to develop your strategy to integrate the flow of information among these various systems. The task of establishing a CMS may be daunting, but the ROI can be significant in terms of workflow efficiency and unprecendented quality and timeliness of information. In the information age, that can be priceless.

Last but not least, we come to knowledge management systems (KMS.)  A knowledge management system is the collection of policies, procedures and systems in your organization for capturing, processing, storing and disseminating information. In essence, it is the over-arching strategy that manages the organization of all of you firm’s information. The value of the KMS increases as the focus progresses from managing raw data such as supporting documents and transaction data, to information such as reports and forms, all the way through to capturing pertinent “knowledge.” This may include an analysis of a unique tax strategy, understanding the peculiar information needs of a particular client’s operations, documenting tips and techniques for leveraging the power of a specific software application, or knowledge of how to apply an auditing standard in a specific industry.

We’ve giving you a lot to think about in this article as it relates to developing your firm’s information strategy. Probably more than you want to deal with on the heels of completing a busy tax and audit season.  The key is to be strategic in your planning for the long term evolution of these systems in your firm. Take care of the basics first by successfully deploying your EDMS, forms automation and workflow software. Then progress towards your CMS and KMS strategies, both of which should always be clearly in mind as long term objectives while you work on fulfilling your short term strategies. All the while be mindful of the competitive advantage that a comprehensive information management system will bring you in today’s information age. “People respond to incentives.”


John Higgins CPA.CITP
John Higgins, CPA.CITP, is a strategic advisor with Rochester, Mich.-based CPA Crossings, LLC. John and his firm specialize in helping accounting, tax and financial professionals leverage technology to be more productive and profitable. CPA Crossings ( has extensive experience in helping firms make the transition to a “digital” (paperless) practice model. He contributes regularly to The Progressive Accountant on related topics.

John has extensive knowledge and experience working with CPAs throughout the country. He has been actively involved in working with local, regional and national CPA firms over the past 25 years and facilitated hundreds of planning sessions and retreats to develop strategic plans, technology plans, workflow design, innovative client services and more.

John is a nationally-recognized speaker and author on technology issues impacting the CPA profession, with an emphasis on transforming to a digital practice model. He previously worked as a natiional consulting partner with a top 10 CPA firm, and is the former chief executive of an accounting systems consulting firm.

John is a member of the American Institute of CPAs Business & Industry Hall of Fame and past chairman of the Michigan Association of CPAs. He is also a member of the AICPA Council and CPE Advisory Committee and received the MACPA Innovative User of Technology award.

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