After a crazy 2020, it’s easy for everyone to consider planning in an unknown period as something that can be missed.
However, with SMEs more digitally aware as a result of the pandemic, there has never been a better time to think about your cloud accounting and app advisory service line with some associated targets.
With more of our society being exposed to digital ways of communicating (zoom quizzes/meetings, WhatsApp/FB calls, etc) we are now seeing more SMEs open to the world of digital and how it can improve their business life. They are more aware than ever about the fact that technology can transform their business.
Over the last few years, I’ve seen very few firms actually plan for their cloud accounting and/or app advisory services in general, let alone for a full year. This is a mistake. Without targets, where is the incentive to drive things forwards?
However, that being said, we are seeing some change to that – so if you’re wanting to plan some targets for your cloud accounting projects for the next 12 months this article will help.
What revenue targets should we set?
Targets & plans are great to have in place as they cement the firm’s aims for the year, allow the firm to communicate with the rest of the firm, measure them throughout the year and then be able to assess where the firm has delivered and where the firm needs to improve.
In terms of cloud accounting and app advisory services we should be thinking about tracking revenue for the following areas:
- Adoption – this is where our primary aim as a firm is to adopt more SME’s (clients/prospects) to cloud accounting
- Optimisation – this is where our primary aim as a firm is to optimise and improve the use/client experience of cloud accounting.
- Maintenance – this is where our primary aim as a firm is to maintain clients on cloud as the adoption and optimisation phases are complete.
Delving down a level to the actual services in each area that should each have their own revenue targets:
- Finance Function Reviews
- Cloud Migration Services
- Cloud Migration Training
- Digital Health-checks
- App Research & Recommendation
- App Implementation/Integrations
- App Training
- Software Support
Other non-revenue targets that we might want to track:
- How many clients converted to cloud
- How many prospects converted to cloud
- How many existing cloud clients contacted to discuss optimisation
- Looking for automation opportunities within the existing cloud setup or problem that an app will solve
- How many apps recommended
- How many apps implemented
- How many cloud education sessions delivered (this is more from a nurturing aspect than a cloud accounting or app training aspect)
- How many case studies produced
- How many client testimonials produced
How to set cloud adoption and app advisory targets
When it comes to setting the targets, set up a single sheet with all of the elements you want to track with a target by month for 12 months – the target could be revenue or a standard number that you want to hit. You must define the services that you are going to be offering (ensure there is a defined service with process, pricing and resourcing in place) and it could be that you are looking to bring more services to the fore over the year.
- Set some time aside each month to update your targets sheet with the current numbers against the target, once it is updated make it visible to the interested parties and set up a regular meeting to discuss working out what needs to be improved for those areas not hitting targets, don’t forget to celebrate the wins too! Don’t just focus on the revenue, for example delivering educational sessions to attract new cloud clients and building regular case studies are also vitally important.
Understanding revenue targets
In terms of understanding revenue within the services listed above we rank firms’ earnings per month in the following way:
Tier 1 – less than £500
Tier 2 – more than £500 and less than £2,000
Tier 3 – more than £2,000 and less than £5,000
Tier 4 – more than £5,000 and less than £10,000
Tier 5 – more than £10,000 and less than £20,000
Tier 6 – more than £20,000 Some rules are around this:
- Must have hit the level for 3 months on the bounce
Fee earning activities covered are:
- Scoping (consultancy)
- Cloud Migration
- App research & recommendation
- App Implementing
Targeting and measuring are an important factor when firms are building out their cloud accounting & app advisory service lines. There is no better time to have a plan in place than 2021 so get started asap with getting these targets in place, don’t forget the updating and review part which many firms forget to do.