A Digital Firm is vital but a Human Firm is critical for your practice to succeed

The Human Firm is a best-selling book by Will Farnell, the founder and a director of accounting firm Farnell Clarke (he also wrote its predecessor, The Digital Firm). In this extract from the book, Will talks about the importance of your practice embracing all things digital and complementing that with a human approach.

Five years after The Digital Firm, I am here to share the next paradigm shift in our profession.

It is a shift in attitude from relatively impersonal compliance-based processes towards a deepening of authentic human relationships, full circle back to the way accounting started.

Based on regular communications and the associated provision of value–added insights to the client, it sounds simple but isn’t.

It results in deep change, an increase in competitiveness and a level of future proofing that is vital for the accountancy firm’s survival.

Still just focusing on compliance? You need to evolve now

The writing is on the wall.

Despite Covid driving firms to work more in the cloud, despite Making Tax Digital (MTD) for small businesses, and despite an increase in automated service provision by new tech providers, most firms still make their money from compliance.

Even now, few firms are fully digital (and by that I mean entirely cloud-based and supported by appropriate end-to-end processes).

Faced with these important challenges in compliance practice and accounting services over the coming decade – including digital compliance requirements, artificial intelligence (AI) and clients with an increasingly cloud-based digital approach to information processing – firms have to change to survive.

My accounting firm, Farnell Clarke, is thinking and working towards the next evolution of the human firm as the only logical step to stay at the leading edge of a constantly evolving and increasingly competitive environment.

In The Digital Firm, I wrote “the accounting market landscape will be unrecognisable in another five years’ time”, and that doing nothing, while a choice, would result in firms going out of business.

I got the timing wrong, clearly.

But the market is changing.

Firms can continue to bury their heads in the sand and do nothing, knowing that eventually clients will leave for organisations able to provide added value services or simply to take advantage of a reduced cost of compliance.

That so few firms have made the shift – even now – is an advantage for early adopters.

As for Farnell Clarke?

The implementation of our vision continues. No longer the flighty teenager, we are still doing things somewhat differently.

Here to help you become a Human Firm

Hopefully this book, The Human Firm, which summarises what we’ve learned during our leading-and-occasionally-bleeding-edge evolution, will help you accelerate your shift to a Human Firm, and maximise the benefits of doing so.

Like my previous book, The Human Firm is primarily based on my experience; if the text is unattributed, assume it’s me.

I’ve joined with Sage to produce it, and because I want to give you the best possible choices, I’ve brought in experts and independent case studies to give a more balanced perspective.

By doing so, I aim to provide senior managers with a quick overview, more details should they be interested, and the confidence that what follows is worth passing on to staff.

What you’ll discover in The Human Firm

The book is in seven sections, (eight if you count the appendices, but who does!):

• Making a Start is about setting the scene.
• Making it Grow about scaling your firm.
• Making a Difference is about how to differentiate the firm and how you might measure progress.
• Making it Human is the nub of the book (although the Human theme runs throughout the whole book).
• Making it Work covers practical aspects.
• Making it Out is about context and choices.
• Making it Coherent is about sustainability, future proofing and – of course – exit strategy.

Before each section is a tiny preview, and before each chapter a quote that shows the tone of the following chapter.

After that comes the body of the chapter and there are takeaway notes at the end.

Farnell Clarke has made the mistakes so that you don’t have to.

That’s what the ‘Will to Learn’ sections are about. They share important learning points and a few epiphanies.

I’ve started each chapter with quotes; something I said five years ago, and what I’m saying now. It’s a shorthand to show how Farnell Clarke’s approach has changed, if indeed it has.

You’ll also find quotes in each chapter from conversations I’ve had with interesting people covering things as diverse as case studies, opinions and future predictions.

They’re very revealing, and give different perspectives and takes on what I discuss in the book.

You can find more of these non-Will perspectives in the appendix and the conversations themselves are available online.