How to Measure Your Technology Effectiveness

Source: Accounting Today

The percentage of revenue spent on technology, and the number of technology personnel in the firm, are no longer adequate measures. L. Gary Boomer, of Boomer Consulting in Manhattan, Kansas, provides these measurement suggestions:

• Firms that invest in new applications, vis-à-vis expanding existing technology, do better. Invest in content management, Web-based services, etc.Accountants should use data extraction tools in lieu of checklists. Checklists are inefficient.
• Clients should be able to use portals to work with their data. Email is not secure.
• Security of client data is critical. Consider using application service providers.
• Clients can be billed electronically via the Internet.
• Engagement efficiency can be dramatically improved by putting technology personnel on the engagement team.
• Firms should use the same multiples for technology that they use in determining hourly billing rates.
• Everyone in the firm should be a teacher as well as a student.
• Calculate and search for ways to improve revenue per full-time equivalent (2080 hours per year).

To be successful:

• Your management team should include technology as well as management skills.
• The technology plan should be part of the firm’s strategic plan. There should be an adequate budget to implement the plan. Outsourcing should be considered.
• Here are some suggested categories for timekeeping in the technology department:
  • Planning
  • Networks
  • Assisting users
  • Updating software
  • Updating hardware
  • Security
  • Projects
  • Client projects
  • Training and professional development
  • Recruiting
  • Working with vendors
• Technology personnel must be educated on the firm’s goals and strategies.

From Accounting Today, December 11, 2006, SourceMedia Inc., One State Street Plaza, 27th Floor, New York, NY 10004, 800-221-1809. For the complete article, click on the following link: www.webcpa.com/article.cfm?articleid=22773&;pg=acctoday&page=1.