Accountants have been helping their clients choose accounting software for as long as it has been available. At the entry level, this is something of a no-brainer: Sage dominates the marketplace. Clients seem happy with what they get and firms feel safe recommending them because the transaction is a simple one.

After the firm has sold the software as a commodity, helped the client to set up the chart of accounts, and done a little hands-on training, they can take a back seat while the software developer handles all the maintenance and support.

But as clients grow or change, their software needs to become more complex, along with the systems-related issues that they, and you, may need to consider. They may need to customise their accounting software and integrate it with other industry-standard applications. They may want to run large numbers of concurrent users on multiple sites. They may require help selecting and sourcing large amounts of hardware, and setting up sophisticated networks.

When you reach this stage you have three choices: ignore the issue and risk your client switching firms; form a strategic partnership with an IT company that has the skills and experience; or recruit and train the staff you need to set up an operation devoted to systems.

Find your partner

Haines Watts has joined forces with a specialist, value-add reseller. ‘We started out by using Sage products in the firm, then decided to use the knowledge we had gained to help our clients,’ says Andrew Jones, a partner in the firm’s Birmingham office.

But some of its clients outgrew Sage Line 50. ‘Some of our clients have requirements that aren’t best met by Sage Line 50,’ says Jones. For many, the Sage Mid-Market Solution is the obvious next step.

‘From the client’s point of view, a mid-market solution such as Sage’s Mid-Market Solution may be just one more accounting application, but it is a significant step change for an accounting practice.

If a firm wants to offer an additional service and doesn’t have the expertise in-house, it should partner with one that does,’ suggests Jones. ‘That’s what we’ve done at the Birmingham office.’

The two organisations have complementary skills and, a few years into the relationship, are still working well together. ‘When you link up with another company, you can’t help but wonder if they will work to your high standards,’ says Jones, voicing a concern that would trouble many firms.

So far, Haines Watts has not been disappointed. ‘We trust our business partner to deal with our clients,’ he says. ‘They handle the installation of the software and the hardware. We step in if the client has any accounting queries and then bill our MMS partner for the firm’s time.’

The relationship has benefited the firm and its clients. The client can access the best possible expertise in accounting and IT, grow its systems along with its business and closely align its business systems with its business strategies.

Haines Watts has become more confident about offering extra software and system-related services to clients, increasing its client base and developing new revenue streams. ‘The more services you can offer, the bigger your pool of prospective clients,’ says Jones. But he isn’t keen to see other firms follow in its footsteps. ‘We’re in business, not in the business of giving away clients,’ he says.

Open to change

Berg Kaprow Lewis has also gone through a similar evolution, but it opted to set up its own specialist group – BKL Technology. ‘We used to sell Sage on demand when the firm and its clients were smaller,’ recalls Jeremy Hyman, partner and managing director of BKL Technology. But as the firm and its clients have grown, the needs of both have become more complex.

‘As time passed, we found that many clients were outgrowing Line 50 and we didn’t want to face the risk of losing them to another firm,’ explains Hyman. So BKL decided to look into becoming a distributor itself.

The company started by looking at half a dozen or so mid-market offerings and then whittled the shortlist down to just two: Access Accounting and Iris Exchequer. ‘Neither wanted us to support both,’ he says, which is a fairly typical reseller experience.

And although Hyman wasn’t convinced by the arguments the suppliers put forward to justify this, a single choice was necessary.

‘They’re both good products,’ says Hyman, but the firm opted for Access because, at the time, its offering was the most appealing for a first-time reseller.

‘Access was able to deliver a process that turned us into a dealership,’ he says, providing detailed guidance and clearly defining the steps the firm would need to take. Becoming a distributor for a mid-market product such as Access Accounting, Iris Exchequer or Microsoft Navision is different from occasionally punting a package such as Intuit QuickBooks or Sage Line 50, not least because resellers in the mid-market are responsible for providing support.

‘We had to invest heavily,’ explains Hyman, because although the firm already had some software development ability in-house, it needed to ensure that BKL support staff were technically competent and financially aware. The firm also needed to adopt a different mindset from the one associated with more traditional accounting services.

Even the most urgent client queries are unlikely to need an instant response, but this does not tend to be the case with software and system-related issues. ‘If someone can’t print an invoice or produce a report, then you need to deal with the problem right away. It was a change of pace for us,’ says Hyman, who warns other firms to make sure they know what they are taking on before embarking on this sort of venture.

Realistic expectations

Hyman explains that it can be a huge undertaking, for many reasons. ‘Do not underestimate the costs involved,’ says Hyman. ‘You will need a suite of people dedicated to providing the resources for sales, development, support and so on.’ And be prepared to experience a certain amount of discomfort while you figure out the sort of engagement that works best. ‘You learn as you go,’ he says. ‘It’s painful, but it can also be rewarding.

‘The firm becomes much more involved with the client than it is during the compliance process,’ he explains. Instead of having one or two points of contact, you tend to develop relationships with numerous people.

‘You work with board members, the financial director, the financial controller and people on the operational side,’ says Hyman, in a multi-level engagement that makes it harder for the client to move away at some time in the future. ‘The benefits are colossal,’ he adds, ‘but so are the risks.’

THREE STEPS TO HEAVEN

Stage one

BKL Technology provides a three-stage engagement to clients who are exploring the possibilities of business and accounting software. The first involves providing advice. By talking to organisations about where they are today and where they want to be tomorrow, BKL can identify areas of dissatisfaction and get a picture of what the organisation needs in terms of software and systems. ‘The process involves distilling all of this into a needs analysis. It’s quite a skill,’ says managing director Jeremy Hyman.

Sometimes the relationship goes no further. For example, if the client lacks the resources or backing of senior management, or because BKL doesn’t want to end up in the position where its best efforts are thwarted by predictable problems.

Stage two

The next stage of the engagement involves specifying a solution. ‘This is a very detailed process,’ says Hyman. BKL is responsible for helping the client identify what it needs to put in place to solve its problems. Maybe it needs to develop its infrastructure or install a CRM system. It’s a risky area, because if the project goes ahead, you will be responsible for supporting that system for as long as it is in place. ‘You have to specify everything carefully and make sure it is all nailed down,’ says Hyman.

Stage three

The third stage involves the installation and support of the Access Accounting system. But, as with stage one, the relationship may go no further. Sometimes clients don’t want it to; sometimes the firm decides it would be inappropriate. ‘We may not feel we are the right delivery partner,’ he says. Perhaps the firm is too expensive for the client, or BKL feels its demands would strain BKL’s support desk.

If the client needs to go into the wider marketplace, BKL can still offer a project management service, working with an external reseller, but it doesn’t always choose to. ‘We have to protect our reputation,’ says Hyman. ‘We are a trusted adviser and we won’t jeopardise that for the sake of one sale.’

Lesley Meall is a freelance journalist