I’m making a bold prediction: The accounting firm as we know it today will not exist by 2030. Before you dismiss this as doom and gloom, consider that 24% of accounting professionals surveyed agree with this assessment.
“The accounting firm as we know it today will not exist in 2030…and 24% of the profession agrees with me.” Jody Padar, The Modern Firm® podcast
But what does this really mean?
It’s not that accountants are going away—far from it. Rather, the traditional business model of CPA firms owned by licensed professionals and subject to current regulations will undergo a fundamental transformation. We’re already seeing this shift with private equity money flowing into the space at unprecedented levels. The future likely holds “accounting companies” that are primarily technology companies selling accounting and tax services.
The value pricing revolution
Central to this transformation is the need to move away from the billable hour model. Through my years of experience running my own firm and working with countless others, I’ve observed that undervaluing services is a chronic problem in accounting firms. The solution? True value pricing—not just fixed fees, but pricing based on the actual value delivered to clients.
The benefits of value pricing
In my experience, the benefits of value pricing include:
- Enhanced client experience: When we moved to value pricing in my firm, we created more structured, proactive service delivery models. No more waiting for clients to call with problems. Instead, we planned regular check-ins and advisory sessions.
- Improved staff satisfaction: Value pricing allows firms to eliminate the pressure of tracking every minute and enables a better work-life balance for staff. When combined with modern technology, it helps eliminate the expectation of 60-hour work weeks.
- Better technology integration: With value pricing, firms can properly leverage automation and AI without worrying about “losing billable hours.” This allows staff to focus on higher-value advisory work while technology handles routine tasks.
The technology imperative
The transformation of accounting firms isn’t just about pricing—it’s about embracing technology in meaningful ways. I’ve been saying for years that firms must recognize their competition isn’t just the firm down the street anymore—it’s technology companies that are figuring out how to deliver accounting services more efficiently.
Let me be clear about the technological shifts I’m seeing:
- Using AI and automation for routine data entry and processing.
- Leveraging bots for basic accounting tasks.
- Implementing cloud-based solutions for real-time data access.
- Focusing on advisory services enabled by technology.
The path forward: How to move to value-based pricing
For firms looking to transition from billable to value-based pricing, here’s what I recommend:
1. Embrace change
I’ve seen too many firms get angry about change instead of adapting to it. Rather than resisting the inevitable changes in our profession, view them as opportunities to build something new.
2. Rethink service delivery
Move from reactive to proactive service models, with clear productization of services. Your clients don’t care how the sausage is made—they care about results and insights.
3. Invest in technology
Why have a staff person do work that a bot could do? Having a manager doing work that automation could handle doesn’t make sense.
4. Focus on advisory services
Use technology to handle routine tasks so your staff can focus on providing valuable insights and guidance to clients.
The bottom line
Our profession is at a crucial inflection point. The firms that will thrive in the future are those that can embrace new business models, leverage technology effectively, and focus on delivering real value to clients. The good news? This transformation can lead to better outcomes for everyone—more satisfied clients, happier staff and more profitable firms.
The question isn’t whether these changes will happen, but rather who will be prepared to take advantage of them when they do. Let’s adjust to the world we live in today. Let’s have a renaissance and rebuild what we want the firm of the future to look like.
Instead of getting angry about change, let’s see the opportunity. When this much private equity and venture capital flows into our space, it means there’s tremendous opportunity for those willing to embrace it. The future of accounting is bright—it just might look different from what we’re used to.
Listen to this episode on The Modern Firm® podcast to learn more about the radical changes impacting the accounting profession.
