New technology & an aging workforce mark period of transition for services firms

Last year, the number of partners over the age of 50 in America’s CPA firms declined from the previous year for the first time ever. According to 2016’s Rosenberg Survey — a sort of annual industry report card — each size range of firms “experienced a decrease in partner ranks that ranged from 2% to 9%,” despite “robust revenue growth in the industry.”

Though at first glance this seems to be a fairly quiet milestone, the implications of this aging workforce mark a burgeoning transition period for CPA firms (and professional services practices in general) that stands to mold the near future for services firms of all sorts. Here’s why:

The onset of the Great Wealth Transfer

The Great Wealth Transfer” is a term used by economists referring to the transfer of roughly $30 trillion in assets from baby boomers — the largest and wealthiest generation in US history — to their millennial and Gen X offspring. This shift will unfold over the next 30 years, and is projected to dramatically affect virtually every industry, with particularly prominent implications for the wealth management industry, consumer spending, and taxes.

For professional services firms in particular, the way they respond to this transition will likely play a large part in deciding their profitability in the future. As a generation that has never known life without the internet takes up the reins, services firms will need to show great capacity for growth and adaptation to burgeoning technologies in order to both survive the transition period, and redefine the way professional services practices do business.

The onset of new technology

It should go without saying, but the firms seeking out and adopting the most technologically-advanced approach to business are most likely to thrive during this transitory time. There are many ways in which technological advances have already changed various subsets of the professional services industry, for example:

  • Big data: Auditors now leverage big data analytics to parse through different (and massive) databases of information. In just two years, this has become pretty standard practice, to the point that the Institute of International Auditors published an official guide to auditing big data.
  • Artificial intelligence: H&R Block’s use of IBM’s Watson technology, and PwC’s report on the use of AI and machine learning in tax analytics are only two of the many indicators of increasingly heavy investment in AI for servicing tax clients.

The decision to adopt these new technologies is no longer a luxury in the professional services space — it’s an endeavor to not be left behind. With this forthcoming time of change and transition, business leaders need to be actively emphasizing professional development for younger employees, technological adoption, and growth in general to ensure that their firms help shape the future, instead of becoming a relic of the past.

Want to learn more about supercharging growth in the professional services space while maintaining profitability? Register for our July 11th webinar on achieving profitable, agile services growth.
Regina Mullen
ABOUT THE AUTHOR
Regina Mullen
Regina is the Workforce Management Expert & Content Marketing Associate for Replicon. Replicon provides award-winning products that make it easy to manage your workforce. With complete solution sets for client billing, project costing, and time and attendance management, Replicon enables the capture, administration, and optimization of your most underutilized and important asset: time.
Get started today.
Set up a free trial based on your business needs. Start Free Trial

Top Challenges that Large Services Organizations Need to Tackle Now

Unforeseen market dynamics, the rise of disruptive technologies, new business models, and global competition are transforming the business landscape, especially large services organizations. As revenue growth slows down, professional services…Read More

Top 5 Mobile Timesheets On the Go to Make You More Productive in 2022

Time tracking software is the backbone of every company when it comes to recording time and attendance as well as project management. The demand for such software is always increasing…Read More

How can Large Service Organizations Maximize Resource Utilization to Drive Higher Project Profitability

Large services organizations are facing several challenges in their business. On one hand, they need to maintain a flexible hybrid workplace that supports collaborations and can bridge the gap and…Read More

Using shared services? These five technologies are a must

As organizations continue to scrutinize operating costs and look for areas to drive efficiencies, shared services centers (SSCs) are a no-brainer. The concept of a multi-function SSC has been around…Read More

Employee time tracking is dead

iBeacons, Bluetooth Low Energy, Proximity sensing and the obsolescence of time tracking as we know it. Businesses have to track the time their employees work for a variety of reasons,…Read More

Reducing Absenteeism with Effective Time Management and Absence Tracking

Workplace absenteeism is a major concern for American companies. According to the US Bureau of Labor Statistics, unplanned absences cost American businesses an average of 2.8 million workdays every year,…Read More
  • Polaris
  • Time & Project Insights
  • Time & Projects Solutions
  • Replicon Products
  • Replicon Users
  • Enterprise Time Tracking
  • Cloud
  • Corporate
  • Professional Services Management
  • Shared Services Management
  • Time and Attendance Management
  • Customer Feature
  • Time Intelligence
  • Industry News
  • Global Compliance Updates
  • Others