In a world where decisions depend on data, accountants occupy an evolving role within the business community. While accountants continue to play a valuable role in managing an organization’s financial data, accountants also impact the company’s broader business strategy.
Here’s how strategic accountants are being used to shape business success.
The Rise of Strategic Accounting
Accountants are essential in managing a company’s finances and ensuring its books are in order. But technology has made these tasks considerably more accessible while also giving managerial staff greater access to their regular financial data.
As a result, accountants are frequently called upon to explain a company’s finances or even offer guidance regarding important business goals and decisions.
A 2020 survey by Sage, showed that roughly four in five (79%) accountants are helping with business decisions. Accountants’ growing involvement indicates they play an increasingly vital role in shaping corporate strategy.
How Accountants Are Shaping Strategic Development
Accountants are playing an increasingly significant role in strategic business development. Some of the most common ways that accountants can influence a company’s long-term plan as well as its operational efficiency include:
Real-Time Financial Data for Faster Decisions
By leveraging the latest software, accountants can access real-time financial data to help senior management make fast decisions.
But perhaps most importantly, accountants must translate technical information into terms that non-specialists can understand and help them make well-informed business decisions. This may include written or verbal reports and digital tools to illustrate long-term data trends visually.
Insider Knowledge of the Marketplace
Accountants often possess knowledge of the market or the U.S. economy that other employees will not. This means accountants can function as business strategy consultants by explaining broader trends or highlighting ways a company might tap into a new market.
By providing insight and expertise, accountants can help senior leaders expand their knowledge and refine their business strategy. This will help them align with current trends and discover new opportunities.
Recent years have seen increasing overlap between accounting and human resources (HR) departments. But accountants will often have complex numbers that relate to a company’s performance, mainly how it handles its workflows and employee efficiency.
Accountants can therefore recommend new tools, methods, or even employees that will boost a company’s overall efficiency.
For many companies, this results in a reduction in overhead costs. Companies can then reinvest the savings into the business, which allows companies to pursue new initiatives that generate additional revenue.
Financial personnel will often have an in-depth knowledge of industry trends. They’ll also keep a close eye on existing competition. And by adapting its pricing to these current trends, a company can enhance its strategic development.
For example, accountants can help leadership understand the impact of a price reduction, showing the feasibility relative to production costs and the projected sales revenue. These factors can influence how a company sets its prices or markets its goods and services while staying ahead of the competition.
Many organizations already use Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis. SWOT analysis is an evaluative tool designed to help you assess your internal and external challenges and devise strategies accordingly.
Accountants play a vital role in this process. Their in-depth knowledge of a company’s finances can help pinpoint key strengths and weaknesses within the organizational structure.
But their broader understanding of economics and the marketplace can help them identify opportunities and challenges from outside, making them essential for strategic business development.
Exit Strategy for Business Planning
An exit strategy or exit plan is necessary during times of change for a company. Whether it’s due to the founder retiring, leadership change, or company merger, accountants play a vital role when business changes. Having an accountant-based exit strategy is crucial to maximizing your return on investment in your business and facilitating a seamless transition, regardless of any changes that occur.
Unfortunately, M&T Bank reports that as many as 98% of business owners are unaware of their company’s value. Accountants can step in and provide an effective business exit strategy to uncover the full worth of the business. They make crucial contributions to the development of business exit planning and safeguard future business development goals.
Skills of Strategic Accountants
Because accountants now play a more significant role in business strategy, they need more than technical skills. Today’s accountants will also need soft leadership and communication skills since they frequently work with teams or provide advisory services to executive boards.
Accountants strive to stay up to date with a broad range of technical skills to effectively utilize modern digital tools necessary for running a successful business. Together, these skills make accountants a valuable asset for any organization, and accountants will likely see their demand increase in the near future.
Accelerate Change with Strategic Planning
Accounting-based strategic planning can help drive your company’s decisions, but many business owners don’t know where to start.
At Vesta, you will find the business management experts you need to support and optimize your company without going anywhere else. We provide innovative strategic planning services that deliver manageable growth for your organization. For additional information and strategic assistance, contact us today.