Harnessing Athletics and Entrepreneurship in Accounting with Ian Black

In this episode of the Ambitious Accountant Podcast, host Sumith Dissanayake sits down with Ian Black, Founding Director of Direct Advisory in Hamilton, New Zealand. 

They discuss the busy periods in accounting, the influence of Ian's sports background on his professional career, his initial aspiration to become a lawyer, and the roots of his shift to accounting. Ian elaborates on the motivations and challenges behind starting Direct Advisory, the importance of clear communication with clients, and maintaining balance between work and personal life. He highlights the role of outsourcing and AI in streamlining accounting processes and provides insights into sourcing clients and team members. 

The episode wraps up with a forward-looking discussion on Direct Advisory’s future growth opportunities.

Got something to say about the future of accounting in NZ? Let’s chat — you could be our next guest. 

Email - Sumith@brisca.co.nz

Transcript

Ian: [00:00:00] So myself and my business partner, Sam and Lily, we started the accounting firm, must be about 18 months or so ago now. So we'd all previously worked together at a smaller firm, and I guess we just got to the point at that stage of looking around and going for maybe we could give this a crack. So. We were kind of, 

yeah, 

Ian: I think it stage lives where if we were gonna do it, it was time to give it a crack and see how it went.

Ian: And, 

Ian: yeah, 

Ian: haven't looked back at this point, has gone really well. We've really enjoyed the giving it a crack and going on our own piece. 

Sumith: Welcome back to another conversation with an ambitious accountant in New See it in this podcast. I speak to Kiwi accountants who lead the. Accounting and finance industry today.

Sumith: My guest is Ian Black, founding Director Direct Advisory in Hamilton, New Zealand. Welcome up to the Ambitious Account Podcast. Ian, thank 

Ian: you very 

Sumith: much for having me, Greg. So is it a busy time for you in New Zealand? 

Ian: Yeah, I think [00:01:00] traditionally March tends to be pretty busy time. We've got 31 March balance dates, so there's often a lot of last minute compliance jobs getting done and.

Ian: Some of those clients are to push the boat out a little bit. All of a sudden the records turn up and becomes a bit of a busier time this time year. Yeah. It's funny, isn't it, for accounting firms. You always see that kind of last minute rush. Yeah. We're quite lucky with our firm. We don't have too much of that with a smaller compliance book.

Ian: But yeah, definitely. Certainly talking to accountants around town, there's always a bit of pressure in the last few weeks. I would 

Sumith: get to that later in the conversation. So before we talk more about your accounting and the industry and the change in the industry, I wanna start with your early days. Like you mentioned you played a lot of sports growing up.

Sumith: So what skills from sports have you found most useful in your accounting career? 

Ian: I think probably I played a lot of football, a lot of cricket, bit of athletics and stuff, career, and basically would take the opportunity to play any sport possible. And I think the teamwork aspect is [00:02:00] probably the one that has been most relevant for, I guess coming into the working world and being an accountant piece.

Ian: Like you're constantly being part of different teams, whether that's internally within your company or. Going out on comment to clients or working alongside them. And I think that teamwork piece around understanding where you fit within the framework and being able to work with others, I think is pretty key.

Ian: In terms of what I think I've carried over from the sporting days, I could agree 

Sumith: more. I think it's a sport sets you up for that, the team players mindset, right? Which is you're required if you wanna stay in a business or be successful in any, anything that you do. 

Ian: Definitely, and I think even just the, the training side of things of some pretty long hours sometimes in terms of training and developing and building up the skill sets and then making sure you're ready for that on match day.

Ian: That applies in a certain way for the accounting side of things as well. And you go through early days of working through it's uni and then your ca papers and things and you're constantly still [00:03:00] learning and developing and yeah, there's different tax trainings constantly and changes. The front and center these days that you've gotta keep across and make sure you're sharp for that.

Ian: So I think that element plays a part as well. Sure. And 

Sumith: accounting wasn't your first choice, so you wanted to be a lawyer, and what made your mind shift from there? Right. 

Ian: I think part of it was I didn't wanna spend five years a uni. Good excuse to that. Yeah. I think going through, I'd always probably from watching various TV shows, I gone away, A lawyer seems good.

Ian: I like to talk. I'm pretty good at arguing with people. So lawyer seems a logical step. And then I guess you get through some of those later school years and was decent at the accounting and economics papers and had quite an interest on the business side of things. So got to uni, did first year law alongside some of the business papers, and then decided.

Ian: I don't wanna be here for five years and go down the law path. I quite enjoy the accounting bit and probably a little bit more numbers focused than research [00:04:00] and delving into long textbooks. So that kind of ended up being a bit of a switch and yeah, having it have never considered law since then. 

Sumith: I think it's bit like you at the early stage, if you can experience something and decide that's not for me.

Sumith: And then of course which, so that saves you a lot of time and money and energy. To build your career. Sometimes people get stuck, definitely stuck in something that they, because of the sun cost involved, like you have heavy invested in it. You can't get out of it, but you don't enjoy. 

Ian: And I think it's pretty tricky.

Ian: You go into uni as what, 17, 18-year-old, and you might have a vague idea of what you like doing, but I probably hadn't really thought through what a career in that looked like. Was more, I had lawyers get paid. Well, that sounds like a good job. Let's have a crack at that rather than necessarily thinking about what that looks like as a career.

Sumith: Yeah, that's true. I like you because we see only the, the shop front, right? Of any profession. Right. So like a doctor, accountant or lawyer. But we don't know that we like situation, like what they're going through when, you know, [00:05:00] how they, uh, have, they're coping with different challenges in their profession.

Ian: Yeah, and I look at my, my younger sister's a lawyer and I look at what she does and I look at what I do and I certainly know which position I'd rather be in. 

Sumith: Yeah, that's right. And I can understand your entrepreneurial journey, like where you're coming from, a driven family, strong business background.

Sumith: How has that influenced your approach to work and leadership? 

Ian: Yeah, I guess I come from a, probably a fairly competitive family. My younger brother's an accountant, and my younger sister's a lawyer. So we always like to go and I guess, chase each other and make sure one of one of us is leading the way and always competing in terms of what marks you got and how you approach this and how you did that.

Ian: So I think a lot of that kind of being the oldest on that front, it was always setting the benchmark for that and making sure I stick ahead of them. And that kind of came through probably the early years in accounting and comes off the back of the sports stuff as well as I'd like to win and like to make sure that there's a bit of competition going on and that motivates me and.[00:06:00] 

Ian: I guess gets me performing at a higher standard. So early years in accounting, you always used to see how many hours you'd done the last week and make sure you're top of the list and things like that as you go through. And I guess that kind of accelerates some of the learnings through that initial stage and gets you moving forward.

Sumith: Yeah. You always say to the family, or it could be planes, but you know when you are close to, you are close to dealing with when there, when there's competition that that's hidden. Like we definitely don't compete like two. Defeat them, but to win for all of us, I had by that kind of liability aspect with one of my best friends, like we were like class number one or two, right?

Sumith: We was always had that, but we are the best friends, which is a nice way to compete and succeed. Like put together. 

Ian: Yeah, friendly competition is good. It doesn't need to be competition where you're putting others down or trying to step on toes or anything like that, but bit of friendly competition and some banter alongside that can make things a bit more enjoyable and push everyone forward.

Sumith: Coming back to your accounting firm that then directed [00:07:00] wisely. So when did you start the firm and what motivated you to start your own accounting firm? Yes sir. 

Ian: Myself and a business partner, Sam and Linley, we started the accounting firm, must be about 18 months or so ago now. So we'd all previously worked together at a smaller firm, and I guess we just got to the point at that stage of.

Ian: Looking around and going, well, maybe we could give this a crack With myself and Sam been around in the industry for 10 plus years now and worked at a variety of different big four, mid tier, smaller firms, and I guess we'd seen the whole stretch of what different accounting firms look like and worked within different businesses as well.

Ian: So. We were kind of, 

yeah, 

Ian: I think it was stage lives where if we were gonna do it, it was time to give it a crack and see how it went. And, 

yeah, 

Ian: haven't looked back at this point, has gone really well. We've really enjoyed the giving it a crack and going on our own piece. 

Sumith: That's great to hear. I mean, it's a big decision as well, like going on your own versus working for a firm.

Sumith: Yeah, 

Ian: certainly there's a [00:08:00] little bit of scariness around it when you don't necessarily know in those early days what. You know, what the figure's gonna work out like and where the paycheck's gonna come from. And we've both got young families as well, so you wanna make sure that things are moving in the right direction and there's not undue pressure on that front.

Ian: But we've been lucky enough that things have worked out relatively well and been able to move forward with a bit of certainty and bring on enough clients that we've got now a, a pretty stable base to work from. And then it's just how we grow and move forward from there. Entrepreneurship 

Sumith: in accounting is different to some of the other, I mean, any professional service you have technique ideas for you to become an expert in what you do at the same time to wear a number of different hats to promote your business.

Ian: And I think that piece is quite interesting in terms of, I guess where we sit day to day. And what I like about doing the role is that every day is different. That's what I like about sitting in this role where we work with the different businesses every single day. And one day you might be dealing with a complex tax [00:09:00] situation.

Ian: The next day you might be sitting in a board meeting offering some strategic advice. Next day you might be bashing out a tax return. Like every role is different in working alongside different businesses. Keeps it quite interesting. 

Sumith: Yeah, that's so true. And since you started your career in Big Four and then coming into the smaller business life, what was that?

Sumith: Transformation. It looks like my, what was harder for you to change your, what you feel like having that experience still helps you in the small business market? 

Ian: Yeah, I think it's a really interesting one. So I started as a intern and then a grad at Grant Thornton, and that was really, really good. Got a really good grounding in compliance and the basics and making sure that good quality work going out the door.

Ian: And I think that was a really good place to start being at a mid-tier firm where. You gotta touch a bit of everything. You weren't just in your box on day one and managed to get a nice wide field of experience. Then I went across to PWC and that was, [00:10:00] that was an eye opening experience in terms of just the extra level of professionalism and engagement and the different checks and balances you have around everything.

Ian: Being in such a large global firm was another level up in terms of. The tidiness around every partner gets their files reviewed and the engagement letters and what even what systems you can put in, all has to go through a very large approval process. But the flip side of that is some of the clients you get to work with and some of the different people you work alongside, some of these people are technical expertise of 40 particularly years in this one very niche industry, and they know it inside and out.

Ian: So the access to resource at that large firm is incredible. That's probably the biggest switch ahead of going to the smaller firm at a big four. You sit there and a complex question comes in that you don't necessarily know. You've got a hundred different people you can go to get a particular answer at a smaller firm, and now certainly out on our own, you are a lot more isolated on that front and you don't [00:11:00] have a whole tax team to go and run this Christian buyer an audit team or a GST team or any of that.

Ian: So I think that. That ability to research something yourself, bring together a conclusion and bounce ideas off other external people to bring that together. That was definitely a big challenge coming into the smaller firm role and now where we are ourselves. 

Sumith: Yeah, that's right. You make decision yourself now, right?

Sumith: You don't have that backup and Yeah. Yeah. So you are going to be responsible and you have to be bold enough to make the decision. 

Ian: That's where I think particularly where we're at now, direct advisory with myself and Sam, it's a hell of a lot easier having two of us here to bounce ideas off each other than being the one person in the practice.

Ian: Got a lot of friends who have gone out and done similar things, and a few of them have gone out just on their own, and I know certainly, yeah, always here to pick up the phone and bounce ideas around with them, and I think having that network of people around you there. You may not be all under the same umbrella [00:12:00] organization, but having then work at different context so you can just pick up the phone and chat about an idea or, and bounce ideas off someone is pretty helpful.

Sumith: That's true. And a small business, I think, you know, the clients sourcing the right clients or working with the right clients makes a big difference. So when you're looking for clients, you focus on motivated business owners, so where you have different inputs. How do you identify and track the right type of client?

Ian: All our work is from referrals, so we don't really do any advertising or marketing or anything like that. We do the odd LinkedIn post and keep things relevant to keep things tagging along. But all of our work comes through either through existing client referrals or through our networks, which we put a lot of time and effort into.

Ian: And I think the benefit of that is. If you've got existing clients referring your work or your networks referring your work, they know who you are. They know how you like to work, and they can match the right clients to you. Like there's a million accounting firms out there and [00:13:00] there's space for all of them in the market.

Ian: Not everyone is directly competing for the same clients, and there's space for everybody. It's just finding the right niche of what clients are the right fit for each person, and. We've been pretty lucky, I think, in terms of who our networks have sent our way. Yet we go out, we have a yarn to them, make sure there's a good fit on both sides, that we could actually offer something useful to them and help them move forward.

Ian: And likewise, they're willing to work with us and willing to be open to advice and. Suggestions we might have and as long as there's a good mutual fit in there, then we can move forward. 

Sumith: I completely agree. If choose sort of work with the right type of clients for yourself and you know who they're bringing to us as the referrals are pretty similar as well and they were more warmer and aligned with the what we are focusing on.

Sumith: So, which is quite a nice way to get more clients rather than go to the market and source the plants and then do the qualifying process and plus them out a lot rather than retaining. Look, 

Ian: it's definitely, it can be a harder, slower path to [00:14:00] growth. Yeah. If you had a real efficient marketing channel or lead channel that was constantly delivering leads through social media or website or cold calling or whatever that may be, you may be able to get that growth trajectory a lot higher, a lot quicker.

Ian: But I've seen that with firms I've worked with in the past where the growth has been very rapid and the ability to service those clients hasn't necessarily matched that growth. I. Or you get a few years down the track and you look at that client base and someone rings you on the phone, you have a lockdown.

Ian: You're like, I don't really wanna answer that. That's not the person I wanna talk to today. And you don't, we don't have that with the way our book is growing, luckily, and that at the moment we're lucky enough that we like all the clients who we work with, and we're on good terms with them. And hopefully it stays that way.

Ian: But I think it's, yeah, we enjoy coming to work and working with the clients We've got. We're happy with the speed of growth and the clients coming in, and we want to be careful around growing too quickly whereby we [00:15:00] can't still deliver the kind of bespoke, personalized service to those clients that we have.

Sumith: Yeah, that's a great spot to be because if you sort of grow, it's one issue without having this kind of a plan. There's a hidden costing world in that, and I know you got a really good strategy around the client communication and you make your best use of your driving time to get in touch with the clients.

Sumith: So tell me about your experience and why you make that kind of strategy and how it will helps you grow your business. 

Ian: I've got a 15, 20 minute drive to and from home each day, and my business partner Sam, he lives a bit further away. He's in the car 30 to 40 minutes each way, driving into work and.

Ian: Whether that's sitting on the phone with a client or listening to a podcast or something, like it's a good time at times to switch off and you just chuck something on there as a mindless listen and you can move forward. But it's also like utilizing that time well, like ideally, once I get home, I wanna be able to switch everything off, enjoy the family time and not have to deal with your [00:16:00] clients calling or emails coming in or anything.

Ian: Like, there's always a little bit of that's coming up, but. If I can utilize the time that I'm sitting in the car just driving or sitting in traffic, then it's a no brainer to make the most of that time. And even if it's just a call to check in on the clients. Like a lot of our clients, we'd talk to some daily, most weekly, like keeping up just constant communication.

Ian: That doesn't have to be a specific reason to give them a call. It can be just be, give them a call, have a yarn, and go from there. It doesn't need to be any more than that, but the more you talk to them, we find the more work that drops out and the more likely they are to call us when they have a problem, rather than go and do something we find out three months later and have to try fix the mess.

Ian: So that communication piece, I think is. Absolutely key to moving forward. 

Sumith: Yeah. The other aspect of your communication is the simplicity. One of the major challenges we have as an accountant is like not to talk the accounting jargon to our clients, so how to make the message more simplified for them to understand.

Sumith: So what strategies [00:17:00] do you use to make the message more clearer and uncluttered for your clients? I think 

Ian: for me, like I'm a pretty simple person. I don't like to overcomplicate things at the best of time, and I think that's part of the way the direct advisory name came from was our motto and how we approach things is to be pretty direct and upfront.

Ian: And that's trying to, whether that's trying to convey. Some complex accounting concept in the simplest terms possible. Whether that's just giving some honest advice to a client about A, actually this isn't a good idea. Once you work through the numbers and explain it, this doesn't stack. How about we pivot and look at something else?

Ian: And I think that's quite important in terms of. If you really are looking out for the client and wanting them to do best at times, that's gotta be some pretty honest, upfront feedback rather than just sitting there nodding your head and being a yes man to the client and agreeing with all their ideas.

Ian: Alright. The benefit we have is we see many different businesses and we've hopefully got good experience of what does and doesn't work and what we've [00:18:00] seen through other businesses in a similar industry or trying to achieve a similar thing. And I think trying to communicate that to a client. Is a lot more valuable than just sitting there in a board meeting going, yep, that's a great idea.

Ian: Everything's happy days, let's move forward. 

Sumith: Yeah, no, that's completely agree. And sometimes we try to give more information than what they require, and it makes it complicated. Like instead of. Just say yes. So it's more advice. So we send a report of 

Ian: 20 pages. Exactly. And we had that situation with a client just last week.

Ian: So we picked up a new one and kind of the initial engagement with them was a bit of a process improvement review. Review the systems, people, processes, and give them a report at the end of that on ways we think they can move forward and make some positive changes. And we were straight up at the end of that first meeting of going, look, we can get to the end of this and we can write you a.

Ian: Pretty 10 page report that's got nice formatting and a big story and pictures in it. Or I'm gonna send you an email that's got some quick bullet points on ways we can fix this and move forward. [00:19:00] What do you want? And that they don't want us to spend five hours making a, a very pretty proposal that moves forward.

Ian: They just want X, Y, and Z. This is how we move forward. How do we actually do it? And spend the time actioning that and trying to make improvement rather than the pretty proposal piece. And as long as you're upfront with the clients, then. You're delivering good value of what you are giving. It doesn't always need to be dressed up in the pretty format or the pretty picture.

Ian: What a client really wants is just the good advice that they can move forward with. 

Sumith: That's right. So they just need an answer, like simple answer, then a report that didn't read and understand it. Like they're working on their business, right. Working in their business. So they got no time to read through and find the answers, or we better give them the answer there and just sort of give them another task.

Ian: Yeah. And no. Part of that is you've gotta read each client. It's not a, it's not a blanket approach to everybody. Everyone's communication style is different, and the way they receive feedback or the way they want to be [00:20:00] communicated with is different. And I think that's an important part of it as well, is identifying which clients do want maybe a slightly.

Ian: Fluffier wording around it in a bit of a softer approach. Which one? Which clients need to be guided through the process and led towards a decision, or which ones just wanna strike black and white five second answer to something so they can move forward and go on. And I think that's, that's probably a piece that I've learned over time.

Ian: Like I'm quite a direct straight up person. And I think probably early days starting out, there were probably situations where. You're probably a bit too direct, too straight up at times, and I guess as you grow throughout your career, you realize you need to temper that a little bit with some clients and make sure that you're reading the room and adjusting your communication style to suit.

Ian: And I think that's quite important in terms of getting the right message through the client and getting them on board is being able to adapt and communicate the way it will sink in with them and the way it [00:21:00] will resonate with them. Rather than just doing the same blanket approach to every single client.

Ian: That's a great point. 

Sumith: Of course, every we time, easy to prioritize more then and just like put them into a category. So rather be understanding individually so that if we can give more personalized service. And I love one of the phases that you mentioned in your, or saying account accounting emergencies.

Sumith: There's no accounting emergency. I love that one. And my wife always says that to me as well. And how do you apply this in your work life as well as working with your clients and staff? Yeah, I think that 

Ian: like that no accounting emergencies piece is quite key in terms of part of our service that we deliver to the clients.

Ian: As you get me or you get Sam, there's not the wider team or the junior doesn't have the same background on the client, like we're across everything on that client. So you've always got access to us that has pros and cons in terms of how that works. And the phone rings, we'll pick it up. But I think if you're on the same page with your clients, [00:22:00] they know that if they're gonna ring it at six 30 at night, there's actually something you need to discuss and they wanna work through.

Ian: Or is that a tomorrow issue that they'll call in the morning about? And I think it's working on that with your clients to get to a point where both of you understand what needs to be dealt with now and what can be dealt with tomorrow. I think the other piece for me is my email inbox currently at the moment has two emails in it, and those two have just turned up whilst we've been talking.

Ian: Like my email inbox is my to-do list essentially, that I'm very clear on keeping that clear and that's how I start my morning. That's what I do before lunch. That's what I do at the end of the day, is I make sure that all the emails have either been afforded where they need to go or replied to or dealt with in some way where that doesn't just back up to be a massive stream that I've gotta deal with at some point.

Ian: I'm constantly keeping that clear and tidy so that I can make sure I've actually got, if I've cleared all the emails in the half hour before I go home, nothing's gonna build up overnight when I'm at home. That creates a big issue in the morning or anything. It's always at a manageable level where I'm not sitting [00:23:00] there panicking about the a hundred emails I've gotta deal with and who haven't I replied to or something.

Ian: The that communication piece, again, it comes back to that of. Good communication doesn't need to be solved. The client's problem straight away it can be, Hey mate, saw your email. I'll have a think about this and get back to you tomorrow on it, but that one minute, one second email that will take me right means the client knows I've looked at it, knows I'm worth on it, and isn't sitting there going, am I ever gonna hear from this person?

Ian: I don't know if what they're doing. That little quick communication piece can make a big difference in buying you the timeframe you need to actually deliver a good answer. 

Sumith: Strategy, so I couldn't agree more. That's fantastic. That's how you should maintain your balances. Like sometimes the quick response to sort of park it, but acknowledging that I've seen it makes a 

Ian: big difference.

Ian: And I think being caught at times in the past that you can jump into responding to an email quite quickly at times as well. And client flick through a What about X, Y, Z? And you jump in and go, I do this. [00:24:00] Then you sit back and think about an hour later and go, I maybe should have considered this or this as well.

Ian: And I think particularly with some of the advice pits, yeah, you, you can be a bit quick to jump to an easy answer when actually there might be a couple of extra things to consider in that. Which, if you've taken that extra time to think through that, bounce the idea around with someone else, check that it's actually covering all the bases, client's gonna get a better result than true.

Ian: A one line email straight back, which maybe misses some of the points they need to consider. 

Sumith: Yeah, that's right. You're let it sink in your mind and then come back with the best idea. Yeah. Right. So running when, when running an accounting from the other side of the spectrum is the staff, the team members.

Sumith: So when you're sourcing team members, I've seen that you have written to say that you source them on the attitude than the technicalities. Talk to me more about that aspect of how you source the team members to work with you in your business. 

Ian: Certainly, like in our past role at this smaller firm, we [00:25:00] had four offices across different parts of New Zealand and then back at pwc we obviously had a very large team.

Ian: And I think where I've seen people come into those teams and be successful is the good people. They have the right attitude, the desire to learn, and the ability to hold a conversation with someone and have some outside interests and have other things going on in their lives. And the technical part of accounting you, you can learn that.

Ian: Now if you want to be a real tax nerd and go down a deep dark hole, you've probably gotta have some real desire to do that. But the general day-to-day accounting piece, most people can pick that up and learn. That can be trained with someone who's got the right attitude to pick that up. As you progress through the firm and get into those more senior roles, the value of those people is being able to have a conversation with the client or have a conversation with someone in your network.

Ian: Problem solve. Bounce ideas back and forth with someone, and I think that's the key skillset when hiring someone and picking someone up in the team. Think back to [00:26:00] my PWC days, one of the best grads we had came through, he'd been a personal trainer on a cruise ship for four or five years before starting his accounting career.

Ian: Now he came in and hit the ground running and was fantastic at talking to clients, working through problems, and I guess had that little bit of extra maturity or life experience that. Enabled him to be great at what he did. And I think those kind of people coming in who, you know, have been part of some clubs at uni or played sports or gone overseas or done something that gives them that little bit of extra life experience, that plays a massive part in how they function within the team and how they deal with quiet.

Sumith: So the technicality we can teach them, and it comes to you naturally over time, but you had to choose the, your experience working with people. That's something that you have to do it yourself. You only can guide, but it's up to them to take the advice and then grow themselves. Yeah, and I think that's, that's 

Ian: part of you where we are now trying to grow an accounting firm and bring on new clients.

Ian: Like [00:27:00] a lot of what we do is going and having coffee catchups or down to the pub to have beers. Or after this, I'm off play golf with a banker and a potential client. Like those kind of things are. Quite crucial in terms of how the firm gets built up and how we bring on clients. There's no technical expertise to any of that that comes down the track.

Ian: It's that being able to talk to the clients and have a good conversation with them, that's what they value. 

Sumith: That's so true. And we have worked with their outsourced compliance in previous roles. So what was the best practices for integrating outsource teams 

Ian: successfully? All three of the prior firms I've worked at have all used outsourcing for compliance.

Ian: And across those roles, I've seen it work really well and I've seen it work probably not as well as it could've. And I think the key difference between a couple of the firms that I worked with that used outsourcing was one was very clear in this is our process, this is how we approach things. And had given a very documented, detailed [00:28:00] process guide to the outsourcing team.

Ian: Put a lot of upfront time and energy and investment in getting to know the members of the team and getting to get on the same page as them and make sure that everyone, everyone's names and knew the faces behind the names, and made sure that the outsourcing team was part of our accounting team. Yeah, we sent them summaries of our weekly team meetings and everyone was on the same page, so whenever we had a process change or a system change or something, outsourcing team was across that as well.

Ian: When we were giving each job across up to outsourcing or sending it up the extra time of, it's only 10, 15 minutes on a job, but that extra upfront time of making sure the documents are there, making sure there's good background notes for the client and whatever specific things they have going on. If you communicate that well upfront, the rest of the process runs a hell of a lot smoother than if you send rubbish up.

Ian: And then [00:29:00] outsourcing comes back with a million questions and you've gotta answer them, and you get into an endless back and forth. Whereas that extra 10, 15 minutes up front, that gives them a good base to start from. That's when it ran really smoothly and was in great addition to the tape. 

Sumith: If you'll outsource a problem, it's, it'll amplify.

Sumith: So that's what happens in a, in the fast station, unless you have clear process that you can always outsource and with the team running, and also like what you said to say, keep them within the team and keep them aware of what's going on, having the big picture so that they can make their own decisions as well.

Sumith: Rather than just try to get an outcome, but you know, they get the big picture. So time, time their exceptions arises and. There is no process to follow. So yeah, they had to make their decision based on the big picture. 

Ian: I've loved using outsourcing in the previous roles, and it's something as we build up our compliance book here that we'll also use as we grow to be able to scale our time and we running really well.

Ian: In a previous firm where outsourcing would come online from about [00:30:00] four in the afternoon and they'd work through and clear everything overnight, you'd have a bunch of queries sitting ready for you in the morning. You dealt with those so that they were ready to go straight away again, and you could work through a good cycle on that and the additional volume of work we could get through when things were busy.

Ian: And you know, a big consulting project comes in and all of a sudden we need to drop everything and work on that. Everything else keeps ticking along and I think that's the key part where yeah, really enjoyed outsourcing and send value to it in the past is. The consulting work that we do is lumpy. You have times where it's super busy.

Ian: You have times where it's a lot quieter, and having full team here that was scaled up to do full compliance and full consulting when we're the busiest, that's all well and good, but if you're still having those costs sit there when you're in acquired period, that's a lot of additional costs for a business to carry.

Ian: The ability to turn outsourcing on and off as you need them to work through the busier parts of the [00:31:00] year. That's been invaluable in previous rocks. 

Sumith: We worked with the caring firms in that passion as well, so I know how they build the capacity and the best skills of the outsource is the part of the outsourcing.

Sumith: If you do it right, then it's, of course you get the previous benefit out of it. But one of the biggest problems that the market sort of perceive is the quality and the consistency. So what have you done to make sure that, you know, the quality and the disease have preserved or maintained with the outsource team?

Ian: In the past, I've worked at two different places that did outsourcing. One didn't have a specific team who were just working on their WIC and the other one did, and there was obviously a big discrepancy between those two in terms of one that just got sent up. Anyone picked it up and you, that person was learning your processes every time.

Ian: Whereas another time we had a specific team who was dedicated to our work that it was always the same kind of people coming back with the same jobs, so they got to know the different quirks of how you operated and what you were looking for. [00:32:00] And just communication I think is the key. Like you gotta look at it from a cost model of, okay, outsourcing costs X amount on a compliance job to do your time on that job may actually be slightly more in terms of a manager or review time than it would be if you weren't using outsourcing.

Ian: But you also don't have a junior working for X amount of hours on their jobs. So if you've gotta approach it of going. I might have to put in an extra half an hour or an hour on this job to sl the outsourcing process and make sure it works. That's still a time saving of 10 hours on the job of someone who's preparing it.

Ian: So overall, the firm is winning and that job's a lot more profitable and able to be pushed through in a quicker timeframe if you've got a busy team working on other stuff here. I think that's comes back to what you said before. If you just outsource a problem that doesn't help anybody, like your role is the manager on that job or the reviewer on that job is [00:33:00] to give the person doing the job, the framework where they can successfully do it.

Ian: And if you just send up rubbish, you'll get that back. No different to, if you send rubbish to someone here, you'll get rubbish back. Doesn't change. 

Sumith: That's fair. I feel in love the conversation and love to. Hear your thoughts on the ai. That's the last meta we going to stock on this podcast. So you use AI for marketing, client communication, process automation.

Sumith: So what have been the biggest benefit and where do you see the most potential for AI in accounting? 

Ian: AI is a, it's a really interesting one. I was having a conversation actually with a client yesterday, and they were. Doing a business case for a very large piece of machinery coming in. And so their production manager had to do up a business plan and a justification as to why they needed this new piece of equipment.

Ian: So he'd gone and ridden that through AI and come up with a pretty long document. They had a lot of good reasoning. And then the general [00:34:00] manager just put that back into the AI system they were using and said, rebut this proposal. And it was essentially just the two AI systems talking back. To each other and refining that proposal and pushing it forward and getting it to a place where at the end it could go up to the board and be submitted and decision made on.

Ian: But I think that there's useful cases around marketing. It can write an article, it can get 80% of the framework done, and then you're just finessing that and putting your own spin around that, or even a tax advice letter. It can get the framework of that and the format and the base of it done. And then you are putting your piece in.

Ian: I think where we've got to is. It's not yet fully capable of doing a hundred percent of an email out or a marketing post or a, a letter to a client, but it gives you a really good base to work from and cuts down a huge amount of time that goes into that. And then if you are still refining that and putting your piece into, that's where the quality piece still comes out.

Ian: A real interesting use case I saw the other day for [00:35:00] it where. Someone had to replaced their board with ai. So they had trained up their AI tool to have different personas and different skill sets. One sat in a marketing space, one sat as head of finance, one set of head of health and safety. One sat as more strategic executive director coming in, and they essentially held their board meeting.

Ian: With ai, with the different personas coming in and challenging and bouncing ideas back and forth. So I think that's an era we haven't played in too much, but I think there's a lot of scope there for, again, I talked about before if you're isolated, any business owner or you don't have much of a team around you using it to.

Ian: Bounce ideas off. And the key is what kind of prompts you put into it. No different to the outsourcing piece. If you put rubbish in, you get rubbish out. If you use the prompts effectively and use the tool well, you can get some really good stuff out of it. But I think where we sit at the moment is you still have to overlay that and sit with that.

Ian: And what it can't you do is go out, sit down, have a beer with the client and [00:36:00] dissect something for them and bounce ideas around with them on that front. And I think that's where the value piece. Of an advisor, a business advisor at come, whatever you wanna call it, still comes in of using it as a tool to get you extra information or summarize this document and gimme some bullet points to talk about.

Ian: But the ability to still communicate that in a clear, efficient way that works for that client is where our value still comes in. That's true. 

Sumith: It's all about like how you manage it end of the day, regardless of whether is an ai, whether is outsourced, where there's other format. So we still have a role to play.

Ian: Yeah, I think it's just another, it's another tool in the toolbox, and I think if you're not using it, then you will fall behind because the efficiencies you can gain from it are massive. But like anything, it's not a magic tool. That means you, you don't have a job anymore and you can't go out and add value.

Ian: It's just another tool in the toolkit that you can use to. To help clients. So one last question. Am I looking 

Sumith: ahead, where do you see the biggest opportunities for direct [00:37:00] advisory? 

Ian: I think going forward, for us it's growth in that mid-market. That's where a lot of our clients sit in that two to 30, two to 40 mill kind of turnover space and motivated business owners who want move forward.

Ian: They want to grow. And that's our target market. And we've got clients bigger and smaller alongside that as well. But those clients who want to move forward and are open to. Growth conversations and trying to shift the business forward. There's an insane amount of businesses in that space that has absolutely no profile, but have really solid, good businesses that are ripe for growth and as the market.

Ian: And we've been through two or three pretty tough years post COVID and recessions and inflation and all of that going on, and hopefully we are heading towards the back end of that. It's still a pretty tough time out there for a lot of businesses, but. There's certainly a renewed confidence over the next couple of years of interest rates dropping back and activity coming back into the market.

Ian: And I think those clients over the last couple of years have focused on getting the right [00:38:00] systems in place, the right processes, the right people, those are the ones that are gonna be able to take advantage of the economy as it rebounds. And from our point of view, that's where we wanna sit with clients.

Ian: We want clients to grow and move forward and generate the wealth that they want to then go and do the things they want to do. Being part of that in helping businesses get that set up for the economy turn is where the opportunity is on our side. 

Sumith: That's wonderful. Ian, thank you very much for being on Ambitious Accountants Podcast and all the best with you.

Sumith: Firm's future. Perfect. Thank you for having me. 

Sumith (2): Thank you for joining us on Ambitious Accountant. I hope today's conversation has provided valuable insights for your professional journey. Remember, this podcast is about building a community of four, the key accountants who understand the challenges you face and celebrate your success.

Sumith (2): If you have enjoyed today's episode, please subscribe wherever you get your podcast and share with colleagues who might benefit. And if you have a success story you would like to share on our show, reach out [00:39:00] Sumith@brisca.co.nz Until next time, keep ambitious, keep innovating and keep transforming. This is Sumith signing off.