Episode 10 Aynsley Damery

Aynsley Damery.........Serial entrepreneur, former accountant, founder of Clarity software and much much more. 

And more recently #1 International best selling author of 'The Drift' - Why Small Businesses Fail and How to See it Coming.

Aynsley is a 5th generation entrepreneur so it's no surprise that he travelled this road when he grew up immersed in business. 

Transcript

SPEAKER_00 0:02

I'd like to welcome Ainsley Damory of Clarity to uh the latest version of uh a podcast. Ainsley, thanks very much for joining me. Neil, it's a pleasure as always to talk to you. So I'm looking forward to today. Absolutely. And uh I think we've gotten to know each other reasonably well in the last couple of years, and we kind of have a similar philosophy, I think, on business and on the role accountants can play, the importance of good reports for business owners, and how many of them are crying out for better information from their accountants and that big opportunity there is for accountants, but also by helping their clients, you know, it's it's win-win all around. I think we're kind of on the same um wavelength around that. And um, so Insy, do you want to tell me a bit about your background? Because look, I know you as you had an accounting business, you developed clarity, you've published a brilliant book recently, which I'm really looking forward to talking about later. Um, because I've been sharing this with my little video, my short little videos on LinkedIn and telling clients about it and so on. So maybe do you want to tell me a bit about your your your own background? I know you come from a strong entrepreneurial background, and and just share a bit of your background with us, please.

SPEAKER_02 1:14

Yeah, absolutely. I mean, I I guess I bumbo my way into accounting. Um, I uh come from a yes, as you say, a generation of small business owners. I think I'm about the fifth generation when I worked it out.

SPEAKER_01 1:25

Yeah.

SPEAKER_02 1:26

Did a bit of work in my family tree recently, so I might go back further than that. But anyway. Interesting. Um so yeah, I I went into university and I had a real interest. I would I did a commerce degree, so a basic, you know, it was a cross-wide business degree for those that don't know uh the Irish um degree system. And I guess I wanted to go down the marketing route. And in a commerce degree in university in Cork, you major in your fourth year, very American. Um, and I guess I wanted to go down the uh marketing and management route rather than on accounting. But as the time grew near to my final year, you know, the jobs market wasn't fantastic, and my dad had managed to, I guess, persuade his accountant to take me on. Um and therefore I majored in accounting in my final year. I was good at maths, and I could never really, I suppose, kind of marry the the being good with maths and going down that accounting route to the more creative uh, you know, I used to design websites and logos and gardens when I was younger. So I could never quite marry the two up. And it was somebody who said to me that, well, actually, you know, design is all about maths, it's the Fibonacci sequence, the golden ratio, and what's good in design is inherently math space. So I guess maybe that that kind of does explain it. So yeah, I got into accounting, Neil. Um and I uh when I qualified, I joined KPMG, and I really enjoyed that type of accounting. It was very uh it was uh audit audits, but it was audit based on systems, so you didn't it wasn't ticking and using calculators and stuff. You was going out chatting to people, watching how they did it, recording the processes, documenting it, testing it. And so I found that quite fun. But when I uh I guess got promoted up within the organization and reviewing others' files, I felt, oh, this is not for me, and this is certainly not something I could do, sit in an office and review somebody else's files. So I left and I joined a smaller accounting firm in the UK. So at the time I'd been working in the Channel Islands, I left then to to join a small accounting firm in the UK that was looking to expand. And I guess that kind of gave me back the kind of the entrepreneurial side of it. And when I was there, I realized that what we did at KPMG for large businesses, smaller accounting firms didn't do for smaller businesses. You kind of assume the same happens. And so over the years, I helped that firm move from a compliance-only firm to an niche business advisory firm. So we met small business owners, we talked to them about their goals and their ambitions and what they were looking to achieve. We set out plans to help them get there, and then we measured and monitored how they were doing against the plan and had had meetings with them on an ongoing basis. And that's all very bespoke. And I guess I'd taken a KPMG style approach to that and looked at how we could deliver that to small businesses. So it's ad hoc, it's bespoke. It requires a senior team to deliver it, people who understand numbers and understand people and can have good communication skills. And scaling that business from an advisory perspective, I found that really, really tough. We hired big people from the bigger firms thinking they would have that experience, but then they didn't really like working with smaller businesses. We hired people from smaller firms thinking we could train them in the business advisory side, but again, a lot of them kind of got a little bit stuck in the accounts and tax returns area. So I found it really difficult to scale that business. And that's why when I met a fellow accountant, we were both thinking the same thing. We we wanted to make a bigger impact on small business owners. We wanted to do more. We've were limited by what we could do in our accounting firms because we just couldn't get out to market more and more. Um, and we looked at how we could turn this on its head and how could we create something that would enable more accountants to be able to deliver more business support services to more small business owners at an affordable price. And that's effectively what Clarity was built to do, to democratize business advisory, to enable accounting firms to give them the bridge, that language to be able to speak to small business owners and to do it in a way that was focused on results and outcomes. So what the small business owner was looking for, whether that was more money, more time, or more freedom, or a combination of all three, focusing on those outcomes rather than the outputs or the inputs, because accountants think inputs and outputs, you know, this is what I do, this is what comes out. And you and I both agree that reports are helpful and beneficial and absolutely up-to-date financial information is critical for the ongoing success. But there's more than just the reports that need to be uh dealt with from a uh client accounting relationship perspective.

SPEAKER_00 6:03

Yeah. Um and you know, I'm gonna go back to something you were saying about the niche advisory business, and that's what you developed within that UK firm. So just tell me a bit more about that because you you obviously looked, you're bringing some of your KPMG experience, but also maybe your own entrepreneurial experience to that. So just talk to me a bit about how you how you how you introduced that into that business, the the niche advisory, is that what you call it?

SPEAKER_02 6:30

Yeah, yeah, I I guess we did at the time what was called uh an advisory board. So we got our top 20 clients in a room and had it chaired by an independent person. And they asked them things without us in the room, what did you like, what didn't you like, what did you, what were you getting, what weren't you getting, what would you like more of? Um and the feedback that came from a lot of the accountant, uh, from a lot of the the clients was that we were great with doing their accounts and tax returns. We were really, you know, pushing them hard for the the information, getting it all in on time, but that they were looking for more support from us around understanding their numbers, what they meant, and whether the decisions that they were taking were having the right impact on the numbers in the right way. And I guess this is the big crux of the problem here. See, accountants assume uh that small business owners see what they see in the numbers and are probably feeling not afraid, it's not it's not afraid, but they probably feel it's overkill to explain what they see because they assume everybody sees it too. And I guess that's the big challenge. Small business owners don't really get their numbers. Not all of them, but a large chunk of them don't get numbers, don't get percentages. And this isn't just even down to small business owners. You know, Richard Branson famously said that he didn't under he he for a long time he thought net profit and gross profit were the other way around and just couldn't understand what was going on in his business. So this isn't just small business owners that struggle with their numbers. Yeah, and I think we we took that for granted. So we set about understanding what exactly we could do to help solve that problem and to help our clients understand their numbers better and understand whether the decisions they were taking were having the desired impacts and were helping them get to where they wanted to go in their business.

SPEAKER_00 8:20

Yeah, and it's funny because you you've kind of touched on something I was gonna uh talk about in your book anyway, right? Which is getting those clients into a room and so on. Because I'm really curious to know that. Um so the and the book actually, there's a couple of I love stories, okay? So I was gonna ask, I ask everyone on the podcast about stories. So I was reading your book, and like the first part of it I loved, even though you know, somebody kind of knew the seven numbers I was kind of familiar with from Clarity and so on, and then there was a story about Mandy. Is it the physio, is it? And then there was a story about the IT company, and like Mandy one jumped out at me because you can see the the whale there in the background. Like, I've done blogs before about you know how losing claims can help your profits, which sounds totally counterintuitive. But you had a great example of Mandy. If you can recall the Mandy physio story in the book, can you tell us a bit about Mandy and and how uh how a bit of analysis around her profitability and what you did with her resulted in uh those changes you made? Because I love that story.

SPEAKER_02 9:24

Yeah, I mean, look, it's not just about Mandy here, right? This is we've done this with accountants subsequently. This is across the entire ISO small business population. When we start in business, I think we're so grateful to get clients or customers on board that we just take the cash. Um and as the business grows, you just keep taking more and more of the same customers normally, or they refer people who are very similar to themselves or however we build up. And we get to a stage where we have a large number of customers uh producing that profit. Now, I'm not sure, I don't think I do this in the book, but there is an 80-20 principle, obviously. But there is the 20, you know, 225 principle. I'm so I'm not sure if I discuss that. That's a bit detailed. But effectively what it says is 20% of your clients create 20, 225% of your profitability, and the rest just basically the 80% suck it up and eat it away. And I think most business owners get so bogged down in chasing revenue and chasing uh the next new client that they don't really spend a lot of time working out whether those clients are profitable, whether those clients are actually generating sufficient margins, whether they're worth the effort, yeah. Um, and they treat every customer the same. Um, I know my team did it at Tabali Tomlin. I mean, we give great customer service, but they treated my A clients the same as my D clients. And sometimes the people that shout loudest get the more service faster than those that are actually great clients that tick along. So to be able to understand how your clients are are are generating either um, you know, contributing to your overheads or or even to profit is is hugely valuable for every single small business owner. So it's really important that we grade our clients or customers, we understand who's uh generating the biggest profit and effect, and then we focus on weeding out the clients that probably legacy clients that have been our customers that have been with us for a long period of time, um, that can have a massive, massive impact. I've known of business owners that have shed 25% year on year of their bottom um 25% of clients, have have maintained revenue, if not increased revenue, and profitability has grown dramatically because they've got rid of the wrong types of clients.

SPEAKER_00 11:45

Yeah. I think you know you're preaching to the converted here. Um, but the Mandy example was that that her physios that she realized that the sports physio side was more profitable than the others, so that she actually got rid of some of the she had a number of different we'd say types of physio or customers. She got rid of quite a few of the services, got rid of staff, focused on the sports physio. Her sales actually dropped, but that was much more profit, her cost dropped as well. But it ended up that her profits increased, you know, her sales dropped because she was now focusing more on the whales and the profitable work, that her profits increased. Is that my am I remembering it right from Mandy? Was that 100%?

SPEAKER_02 12:26

And it's reflective. It's sorry, what I was trying to say is Mandy is a good story, but it's reflective across all clients, uh all of the clients that we work with. That tends to be the reality of the scenario of the situation. We can I I certainly know of somebody who was involved in importation and uh creation of jewelry. So they were importing gems and and stringing them or putting them together and selling them. And when they focused on the right jewelry shops, on the ones that were generating the biggest profit for them, they decreased their revenue by again something similar. It was, in fact, similar numbers to Mandy. I think it was about 25% drop in revenue, which doubles their profitability. Now, that sounds so counter-intuitive to a business owner. I lose 25% of my revenue and I double my profit. Yeah.

unknown 13:14

Yeah.

SPEAKER_00 13:15

That's the reality. And like, yeah, and it does apply to every business, you're right, because I mean I've done the analysis probably hundreds of times, as well as I like just the stories puts a bit of flesh on it. Um the other, the other thing just coming to your book, I suppose, which I totally loved, uh, the drift, Insy, which is a bestseller, am I right in saying? Is it a best seller on Amazon?

SPEAKER_02 13:37

It was actually, it was an international best international bestseller. So in Australia, um, the UK and Ireland. I would well, I guess you'd expect Ireland, but it was um it was across the street.

SPEAKER_00 13:49

Well that's brilliant. Um and hardback and ebook. All right, brilliant. Sorry, paperback and ebook. So I used um what I what I my cobalt habit I got into about maybe 12 o'clock or half twelve, I'll go up to the local shop if I'm working home, grab a coffee, and either make phone phone a client or whatever, or I'll pick up a book. So in the last month I've been um I've been clicking through your book and it was very I mean even the first 109 pages, okay. I love, but it suddenly came alive to me. I totally loved when you started that question, what do our clients actually value from our service? Okay, and it's rarely what we think it is. Now the book totally came alive. I totally love that. I I did a number of my little short little videos in the car. I was sending them on to clients and stuff. And you that question, and I mean, I Clay Christiansen with his milkshake, what what job does a milkshake do? Which is kind of an odd question, but I have to give you credit, Angie. I think you um you cover it much better than uh is it Christian Clay or Clay Christian as it whatever is that fellow. Yeah, it is. Um, okay, so there was a number of aspects of that that I totally loved. You've touched on one already where you you had a bunch of your top clients together, uh, you surveyed them first around what should we start doing, what should we stop doing, what should we keep doing. You take that information and you act on it, you observe what they do, what do they buy, what don't they buy, and then you also got them together for half a day, those top 20 clients, with an independent facilitator, and you got out of the room. Okay. And you you did touch on this earlier, but I'd like to ask you a bit more about that. Because with the information you gathered, what you learned, what were the main things you learned from that half day session? And how did you apply? What changes did you make in your business based on that?

SPEAKER_02 15:43

Well, this is quite early on, right? So we had I I had always heard, and I suppose we had tried to do it ourselves and came across the same problem. But if you say survey somebody, they either don't respond, or they tell you what you want to hear, or they you know just just want to get through the survey and off they go. So you don't really get good valuable information. And as as Henry Ford form famously said, you know, if I'd asked my customers what they want that what they wanted, they would have told me a faster horse.

SPEAKER_01 16:13

Yeah.

SPEAKER_02 16:14

So we were struggling to get feedback from our customers and our clients. What we started to do in laterally, which I'd only learnt in in hindsight, was a quick lunch with oh, what should we start doing, what should we stop doing, what should we keep doing, is a really great simple way over lunch to be able to get some good feedback. Yeah. But the start of all of this really was that that that major um advisory board effectively that you that you talked about. The information we got from that basically fed our development for probably five to ten years. It helped us focus, refocus on pricing. It helped us focus on looking at the value rather than the what we were delivering, delivering a valuable service and how how valuable that service was to our clients and customers as well.

SPEAKER_00 16:59

Yeah.

SPEAKER_02 16:59

It helped us understand what types of services they valued and what they wanted more of. Um and it completely transformed the way the firm worked, to be honest. Now, it was really important that when you do that, that you immediately summarize the event and your understanding of what they said. And sometimes, as in our case, people get carried away and they go down a little rabbit warrant. And so we re-clarified certain points with people and they said, Oh no, we just got pulled down that direction. Actually, that's not really important. So we did a good summary, we spoke to the people who were involved, made sure we were aware of what we needed to do and how we were going to do it. And then we basically kept those people in the loop as we were developing and creating and moving forward. So it was making sure that they understood that we were acting on the feedback and we weren't just going, Yeah, yeah, that's great, and ignoring it, that we were actually understanding and listening and trying to develop what they were looking for. Yeah. Now that was, you know, I I mean, we won a huge number of awards for the way we did business in accounting, and that I put entirely down to doing that half day session, um, which drove I think everything that we did from there on in.

SPEAKER_00 18:13

Yeah. Look, I kind of did pick up bits of what you got from in the book, but I I just thought I'd ask you in your own words, like what would you say what were the main things you learned from that session?

SPEAKER_02 18:26

That what we thought our clients wanted was not actually what they valued.

SPEAKER_00 18:31

And what specifically was that?

SPEAKER_02 18:33

Well, we were, I guess, making sure that they were paying a minimum in tax because we were quite well known for our tax, you know, helping clients minimize tax. We were making sure that our clients were not late. We were making sure that I suppose from an assurance perspective, that the filings were on time and were were correct.

SPEAKER_01 18:54

Yeah.

SPEAKER_02 18:55

And I suppose much of the ad hoc support and advice that we gave them around the edges was around the edges. And it was part of what we did, not what we did and who we are. I think it shocked us to understand that actually they didn't, well, I suppose it shouldn't have shocked us, they didn't really care about their accounts and tax returns. They expected us to minimize their tax liability. But that was just to get to the starting line. What they were looking for was our insights and understanding of numbers, that we were dealing with many businesses and that we were seeing patterns and things that were happening in businesses, that we would see what certain businesses were doing well and the impact that it was having on their numbers. And they were expecting us as accountants to be able to help them by our experience, our understanding, and our cross-client base, to be able to say to them, Oh, goodness no, uh, your your margins are slipping. Um, is this something that we need to look at? And what do you think you should be doing? And by the way, we have businesses in similar situations who did this, this, and this, and this is what's happened. That's what they were looking for from us. Not company, you know, filings at companies' house, not um, you know, payrolls and bookkeeping, and we didn't do bookkeeping actually, but not payroll and not non-accounts and tax returns. It's it's this is where they wanted to focus on. It was about helping them, I suppose. You know, they they went into business because generally they left a job and they wanted more control and they wanted more money, probably. Um, and most small business owners start excited and then they end up working harder and harder for less. And it just each year it gets slightly worse. And I think that was the whole point of the drift, really. That businesses don't go bust overnight. There is a there is an erosion effectively over a long period of time, and that erosion can be seen if anybody has the willingness to sit down and explain what's happening in the numbers, because the numbers never lie effectively. And so it was really, I guess, that book is you know, I I'd written, I'd started writing this book in when I was in that accounting firm to directly to small businesses, and there were 40,000 words that were sitting on a computer file for years and years and years. And I guess, you know, it's got better for having uh being sat there effectively for for sitting in that file because the experiences and understanding that I've learned subsequently and that's shaped everything that we do at Clarity has also given me that roundedness to be able to put that together and to explain why small business business owners need help and how accountants can go about helping them.

SPEAKER_00 21:32

Yeah. Um and the again, something that uh stood out for me from what that exercise you did asking your clients and so on is you were saying something like what you thought was valuable, they they didn't really care about, like you just touched on, what you thought was routine, they're really valued. And I think part of what you said was when you were aware of this and you started offering those advisory services, maybe the monthly reporting and reviews and so on. It was what they valued was you being honest with them about their numbers, challenging them on their numbers and what they were doing, holding them accountable. Yeah. All those kind of things that you weren't aware that how valuable they were until you actually went and asked the questions. And you then built your business on what you learned and grew it. Yes. Yes, absolutely.

SPEAKER_02 22:22

Business is a lonely place. Small business owners don't really have many people to turn to. Their clients, sorry, their you know their friends generally are working in corporate, their family, they don't want to freak them out. So an accountant is really a safe space for them to be able to have those conversations. And the expectation is I can have that conversation with you, Ainsley, and that you'll help me with ideas to improve my business, but also that that that that that accountability piece. Being accountable to your clients for the advice you give, first off, so standing by the decisions and the discussions you're having, but also making sure that those clients are doing the things that they need to do or that they've agreed to do to move the business forward. And studies show that accountants, sorry, that small business owners who have written goals and who are held accountable via meetings achieve 78% more at a minimum. So that's a massive shift, let alone anything else. And I think this whole support and challenge bit that you just referred to as well, I think is really, really critical. Yeah if if you have somebody who constantly supports you and says that well done, great, good job, then it's quite sycophantic, and you know you're not really possibly achieving your full potential. And if somebody's constantly challenging you on the other side, you're going to find it a grind and it's just going to become a painful relationship and you're going to bow out. So it's having that right balance of support and celebrating the wins when they need to be celebrated and supported, and then challenging when when somebody's actually not doing what they said they were going to do, um, because you know, ultimately they're not going to achieve where they want to go and and and probably don't understand why they did it in the first place.

SPEAKER_00 24:16

Yeah. Um, and one of the things I really liked too was after you know, you you spoke about serving your clients, finding out what they're like, getting them into the room for the half day, is you know, that's all lovely, and some people might go, that's a bit fluffy or woolly or whatever, right? You know, but I loved how you brought that around to actually the business owners who don't understand what their clients value, it it's gonna show up in their numbers, it's gonna show up in their margins and their sales growth and so on. Because and is I have a little section here. I don't know if anybody's read read a section of your book to you yet, but um, I have a little section here because I summarized I summarized the book into a couple of pages. Um so if you bear with me for a moment, um, and I share this with my clients and so on. But I totally I loved how you linked this surveying and understanding what your clients really value back to how it impacts the numbers of the business if you don't actually do it. And what you said is where it often shows up is in gross margin. So just quoting a section from the book if the gross margin is consistently below the sector benchmark, the business is almost certainly underpricing relative to the value it delivers to clients. When the owner does not know what clients value, they can't articulate the value of their offering, and when they can't articulate the value, they cannot justify a premium. And when they can't justify a premium, they compete on price. And when they compete on price, margins are compressed. So this thing about valuing a customer and whatever, which you know, you could see some people going, ah yeah, that's fine, you know, yeah, fine, but not doing it, it has a real impact on your numbers because you won't, you won't, by not knowing that value, you won't reflect, you'll probably you know, charge the same as your competitors, you probably haven't done it and don't understand the value, don't understand why clients buy from you and keep coming back, you can't reflect it in your price. And when you benchmark yourself to your come your peers and whatever, you're gonna be either lower or middle. You won't be, there'll be a gap there in the numbers.

SPEAKER_02 26:31

Yeah. And you won't understand. I mean, the the the thing is, right? So a lot of us a lot of us assume we know what's going on in with our clients. So we might have we might have done some work when we started off in business. We might have got a kind of a feel for a gap in the market and thought, okay, we can we can square that off. But as you evolve in your business, so do your so do your customers and your clients and the business itself, and so do their needs going forward. And so I think that assumption of what they appreciate means that you might be pricing the wrong things. So you might have, you know, you you might end up mis uh I says, under underpricing in certain areas, overpricing it in other areas, both of which will affect your margins. Because if people aren't buying because the price is too high, because you don't understand that that's actually not what they're looking for, yeah, then that's going to have an impact on the sales. So therefore, overall your margins are going to fall because of that process. So it it is it is vital. Like I think every single thing that goes on in your business is reflected in the numbers. And I think that's you know what you've just highlighted. Having somebody there holding your hand, interpreting the numbers and saying, Oh, that's possibly why that's happening, and look at those numbers not moving. Do you think these are the things that you need to focus on? Is is eliminating.

SPEAKER_00 27:46

Yeah. And and the value part, because I've done a lot of work over the years with businesses on pricing. And you know, I I developed this seven-step, you know, formula for approaching pricing, and value is one of them. You know, is is the value of what you do reflected in your pricing? For most business owners, they don't really think about it. And there's a couple of great questions in the book, and maybe this will be for anybody listening, any business owner where there's an accountant arrested me or whatever, there's a couple of great questions at the end of that paragraph on the value, and I think it's it's asked the question when was the last time you had a you know a deep, meaningful conversation with a client about why they buy from you and the value they get from you? And then is that value reflected in your pricing? So there are two great questions, I think, for anybody listening, any business owner. When's the last time you spoke to a client about why they buy from you and the value they get? And then is that reflected in your pricing? Anything to add to um that that's my interpretation, anyway. Absolutely. Um, and the uh I'm looking at the clarity now in the background and realize we haven't had much chance to talk about clarity, but of course, you did you did describe earlier on about when you work for that UK accounting firm and you you know you went through the exercise of asking them what they valued, surveyed your clients and so on. You rolled out, I think you called it a niche advisory part of the business. And then when you found that that's difficult to scale, yourself and Steve imagine, said, Okay, let's do something about this, and you designed clarity, which is aimed really at accountants to help them make you know, help them make it easier for them. There's a process there, there's a there's a tool, there's a process there with the agendas and everything that they can follow. And the idea was to make it easier for accountants who want to actually roll out advisory and help more of their clients with better reporting.

SPEAKER_02 29:47

Is that fair? It is a very fair summary. I think accountants have been trying to implement a model that was given to them in the 1980s, and it's a model that hasn't changed since. And it's a model that was obviously built for a very different time. It was built for large corporations and for large accounting firms that were able to build by the hour. And I think the problem is trying to scale that down for small business owners has meant what I don't think it was ever fit for purpose for small business owners in the first place, to be honest. Um, and in in effect, it's it's very hard for accounting firms to deliver it to small business owners at a price point that that small business owner will be prepared to pay. And that's the big crux of the matter. So accountants have tried to do it, they need to charge heavily for it because it's a senior team, lots of time, bespoke, you know, lots of work. The client mightn't see all that work, but they will say, Oh, no way am I paying that. I want support and help, but I'm not prepared to pay that for it. Nothing existed at the time to enable accountants to be able to deliver that type of support to small business owners at a cost-effective rate that was efficient and effective for them, but also meant that it was at a price point a small business owner would be prepared to pay. And that's effectively what we did with Clarity was to create the tools, the systems, the scripts, the process to enable accounting firms to really focus on what was really going to be beneficial to small business owners and also talking to small business owners in a way that made sense to them and helped them achieve the results that they were looking to do. So it was very much about trying to find that bridge, that communication gap that fits between the two, working out what a small business owner needed and how an accountant could deliver that to them effectively and efficiently. And despite you know what everybody says in the in the marketplace, there is no other solution around that does it as well as that efficiently, effectively, profitably for the accountant, valuably, and um at a good price for that small business owner. So that's everything we've built is to help the accountant help that small business owner achieve success.

SPEAKER_00 31:49

Yeah. And look, I mean, I know I've seen the likes of um Sharon and Graham and Paul Miller and lots of others use Clarity, uh, and I'm sure there's many more I'm not aware of. Do you have any particular message for an accountant out there who's who wants to, you know, who wants to let's say offer a better level of service around advisory reporting to their clients?

SPEAKER_02 32:14

Yeah, I mean, I think the what you've tried before hasn't worked because it's it's it's a system and a and a process that that it was designed to fail. So I think anything you've tried in the past that hasn't worked, you need to just put that aside and say, okay, I'm happy to try this again. So don't let any past failures um limit you. Also, you there's a lot of time pressure on it on accounting firms because they're struggling to recruit. So there's a lot of pressure on them from a time perspective to get the accounts and tax returns basic work done and out the door. So it's important for them to realize that advisory doesn't have to be a time vampire, it can be done efficiently and effectively. Yeah, it doesn't need the hours and the hours and the hours that they're thinking. And effectively, I suppose that Steve and I have thought of everything, it's it can be rolled out from the box. We've thought about how do you market price, sell, deliver at scale. Yeah. Um, and we've put in place all the tools, system, scripts, supports to enable you to do that. So there is an out-of-the-box solution that you can run with, something that's not uh been in the market before, and it's uh something that will certainly help you help your small business clients achieve dramatic success. I think the biggest thing though is that a lot of accountants say, I will get to that, but I will get to it next year or the year after. Where we are going with AI, it's very important that we now don't leave it to two, three years down the line that we start looking at what that means for us now. Because my concern really is at the rate of movement from AI, that our small business clients and small business owners will start using AI more and more and more. And whilst I think it's a great solution for content generation, for marketing, social media, all that sort of stuff, for brainstorming, for idea generation, ideation, whatever you want to call it from an American perspective, great for all of that. I think using it for strategic business advice and support is not a good way to go. And I'll tell you why. So if any small business owner at the moment is currently using AI for strategic financial support or decision strategic decision making, let me set out the case why you should stop doing that. Firstly, AI is known to be syncophantic. So we talked about that support challenge framework. AI and the studies show independent, peer-reviewed in science. So this isn't just bro, bro tweets, this is real stuff where Stanford saw that AI agrees with you 50% more than a human would, even when they know you're wrong. Yeah. So let's just restate that. An AI effectively will agree with you 50% more than it should do, even when it knows it shouldn't. And it does that because it wants to keep you engaged and it knows our human flaws, that we like to be flattered, that we like to be agreed with, to continue to start to do business and keep doing business with it. It has to tell us good good job. And apparently, humans trust it more when it tells them that they're it agrees with them. So I'm gonna trust it more if it tells me I'm right. Now that's just absolutely bonkers. So that's one reason alone why you should not use AI. The second one is it loses its memory from conversation to conversation. We get that. But even within it's the single conversation, the longer and longer that conversation goes, AI will lose its train of thought as it compresses the conversation at each stage. And so what it said to you, then it will forget back here, or what it said here, it'll contradict itself here. So you need to be really, really careful on that whole piece on memory. And this is accountability. If if if you challenge the AI, it'll say, Oh, sorry, I overstated there. Well, hang on a sec. That's a big thing you overstated on. With an accountant or with somebody who's there to help and support you and challenge you, uh uh coach or consultants, they're sitting across from you, they're liable for their for their decisions and helping you, you know. So that that whole somebody there that that that you can keep accountable for the advice they're giving you is really, really critical. And then that last piece we talked about about like a machine, no machine will hold you accountable.

SPEAKER_00 36:29

Yeah.

SPEAKER_02 36:30

And not at the moment.

unknown 36:31

Yeah.

SPEAKER_02 36:32

Not any tattoos.

SPEAKER_00 36:33

Yeah, and certainly words of wisdom there. It sounds like you've you have looked at that quite closely in terms of AI and those those kind of dangers, you know, of of being too dependent on the answers they give. Um, Anthony I could keep talking now. Um, there's probably more about your book and more quotes in your book itself, but I normally I try and keep these to kind of 35 minutes.

SPEAKER_02 36:52

So um I think the clear message is people need to read the book, right?

SPEAKER_00 36:57

Yeah, here we go. The draft summary. No, but I love, I mean, I love that I'm not just obviously I'm not just saying it because I've read it and I'm quoting your back section, so that's a good sign. Um, but before we just before we wrap up, is there anything in particular I didn't ask you about maybe you'd like to talk into?

SPEAKER_02 37:16

I I think I think business owners have it tough at the moment. And I think there's a lot hitting them from all angles. So I think it's really important that they find somebody who's prepared to help them. Somebody who's going to give them a different perspective, somebody who's going to sit across the table from them, somebody who's going to ask them the silly questions, and somebody who's going to understand what they're looking to achieve in their business and help them get there. I think if you're not getting that from your existing accountant, then I think you need to find one who will do that for you because we know plenty out there that will do that type of work for you at a reasonable price. So I think accountants need, or sorry, small business owners need not accept mediocrity from their accountants. There are plenty of great accountants out there who will help them make a massive difference to their business. And I think if you're struggling, then they need to contact one of us and we will help them find the right accountant to help them move forward.

SPEAKER_00 38:14

Yeah, absolutely. And I've even referred a couple of my own uh kind of um my own network, uh, referred them on to some other accountants recently who are more AI savvy and are more tuned into what what the businesses need than their existing um clients. So absolutely. So listen, Ainsy, thanks very thanks very much. It was great chatting to you and um well done on your on your book, on your best selling book and um clarity and everything else, and um really enjoyed chatting with you.

SPEAKER_02 38:44

Thanks, Neil. Good start to you.

SPEAKER_00 38:46

Take care.