By BECKY GILLETTE
What does it mean to be “future ready”? HORNE LLP CPAs and Business Advisors, which is based across the Southeast and serves clients across the nation, took on that topic at their Leadership Summit in late August. It is a topic that every business owner needs to keep in mind in order to be successful in today’s fast-changing business environment, said Joey Havens, CPA, executive partner with HORNE CPA.
“The two words used over and over again are ‘future ready’,” Havens said. “Being future ready means you have the capacity to be anticipatory. You break down anticipatory into being aware, predictive and adaptive. You must be anticipatory of emerging technology and trends in business, demographics and the social environment that impact your company. We as advisers have to be future ready and every business or client we serve has to be thinking of being future ready.”
Havens said the rate of change is moving from incremental to transformation. That is being fed by rapid technology changes and increasing amounts of knowledge. More data has been created in the past two years than in rest of the history of the world.
“We are in a period of disruption and uncertainty,” Havens said. “Those are facts of life. That is not going to go away. We are going to see change on a scale people haven’t seen before.”
Knowing that technology change is coming, and that there will be business disruption, can get pretty daunting. It is a challenge. But while there is a lot of uncertainty, Havens also sees a big field of opportunity.
“Let’s flash forward to our future and what we have been talking about,” Havens said. “We are talking about change we haven’t seen and experienced before. We have seen the power of our phones change. We’ve seen a lot of automation in our lives. We have seen it touch on the way we are working, but we haven’t seen it replace the way we are working. We have to start preparing.”
Havens said it is important to have a windshield view looking ahead and anticipating what is around the corner. In fact, many firms are looking into the rearview mirror hoping that what has worked in the past will continue to be the template for the future. But that isn’t the case.
“Since you know change is not going to be incremental, you have to prioritize being future ready and work with future ready advisors such as bankers, CPAs, and lawyers,” Havens said. “It is important to work with professionals who are also being anticipatory. I would encourage any CEO, CFO or CIO to spend at least one hour a week reading and studying to anticipate what is changing in their business. That is where you start. Most of us don’t do take the time for that because we are really busy blocking and tackling.”
Are some businesses doomed because they will be replaced by technology innovations? That isn’t necessarily the case. An example is Kodak.
“It is not that Kodak was doomed,” Havens said. “It was that they were not willing to change their business model. That is the difference. Kodak could have been Instagram. They are not because they kept trying to do business printing photos and the business model had changed to sharing photos.”
Bill Gates in his book The Road Ahead said, “We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten. Don’t let yourself be lulled into inaction.” Havens thinks that is important to keep in mind.
An example of a company that has successfully navigated technology changes is Domino’s Pizza.
“It was on a downturn in 2010,” Havens said. “Then they made it easy to order a pizza with a smartphone. Now you can tweet an order, and you can track your pizza and driver’s progress. This year Domino’s started driverless delivery service in Ann Arbor, Mich.”
In the case of accounting firms, because of the automation of technical knowledge, Havens said they can’t just continue to do bookkeeping, taxes and auditing or they won’t be relevant or in business in ten years.
“For the 55 years since HORNE LLP has been in business, time has been our friend,” he said. “Even if we messed up a spread sheet, we could charge for more time. Time is going to be irrelevant. It is going to turn into our enemy. So, we have to quit running a business model on a time clock. Our clients are already demanding insights and data analytics.”
Havens advises against thinking it is doomsday and instead look for opportunities. But know that every business model is going to change. How is it going to change is what you want to start anticipating.
There will be a lot of competition.
“Do IBM, Google and Amazon scare me? Absolutely,” he said. “But there are a whole lot of things they don’t have to offer such as wisdom and legacy relations. Where we get our confidence is we are technical experts. Emotional intelligence will be a required field. Our firm will prosper when we are able to take the data, take the analytics, take the legacy customer relationships and as teams use emotional intelligence to cooperate to find solutions.”
Havens said it is important for advisors from firms like his to get on site and find out what is going on with clients. What are the opportunities? Is there a culture for innovation?
“There is going to be a lot of disruption,” Havens said. “Future ready businesses need to take steps to be prepared to win. We might be ahead of some of our competition, but if we think about how fast the competition is changing, we realize we are not moving fast enough. And we must have a shared future view so we understand why we are going to do what we are going to do. The strategy about our future view is having a growth mindset.”
Havens said HORNE LLP advisors will have to redefine reality for clients. They don’t understand all the hard trends and how it is going to affect their business model. They are looking for someone to inspire them.
“It is way different than how we are serving some of our clients now,” Havens said. “But that is where we have to be. We have to get over that gap. In a crowded marketplace, if you don’t stand out, you are invisible.”
HORNE LLP is a top 50 CPA firm with more than 500 employees in locations around the Southeast. The company serves clients around the country.