Accountancy Network - Are there any benefits for small and medium size firms?

Is there any benefit in joining a network of Accountancy firms? While there may be some benefit, it all depends on what a firm wants to achieve. In many cases, the membership fee of an international network may be very high and this will have to get passed on to clients. However, is there any additional or value added benefit that clients will obtain from getting serviced by a firm that is part of a larger network, especially small and mid-size firms. This may not be necessarily so in most cases. Every firm has its own culture and management system which is conducive to the environment in which it operates. Joining an international network may lead to the culture of firm being eroded and not being in line with the expectations of its clients as the international network's higher management often have limited idea as to what local clients want. Is it beneficial for a local firm to get an international tag at a high cost that will eventually have to be passed on to its clients?

There have been very significant changes in firms’ membership of associations and networks over the last few years.

The dramatic changes, brought about by the acquisition of principal members in various countries, have raised the question as to the value of an accounting association: does membership provide merely a networking opportunity, or does it bring buying-power benefits, improve access to skills and raise the profile of an individual practice beyond its geographic footprint? 

It would seem that the major benefit now is not only the technical exchange and pool of skillsets, which might not be accessible to an individual practice other than through an association, but also the networking opportunities and understanding how other practices have tackled management issues, marketing, digitalisation, etc. As a result, these associations have developed specialisations and sub-groups looking at IT, digitalisation and specialist tax, alongside industry specialisms including agriculture, education, medical, professional services, etc.

Identity crisis

The issue that has always dogged associations is identity and branding – how firms should use the association branding alongside or instead of their own. Having a single brand has an advantage when dealing with banks and other institutions, but the change of identity in a local market may be seen as a risk and a perceived loss of independence. 

Looking at the value of associations and networks, much depends on the closeness of cooperation between the member firms and the time invested in building relationships. This hinges on linking successful firms of similar size, which may have specialisations but are generally working with similar clients in different geographic areas. Internationally, key considerations include the network/association’s brand overseas, its referral potential and the quality of member firms in key locations.

The fundamental changes to some of the networks’ and associations’ identities brings into question the value of being a member and whether joining up should merely be regarded as transitory – a useful vehicle during a particular stage in the development of a practice – or something more lasting, evolutionary and sustainable as part of a restructuring.

Constant pressure to increase revenue and compete with other networks for higher ranking

Accountancy Age is an online trade publication for accountants and financial staff in the United Kingdom. It ranks accounting networks regularly. Apart from the Big 4, Deloitte, PwC, E&Y, KPMG, other networks are ranked by combined annual total income. The race to get to the top of the list puts constant pressure on network members to increase fee income. This is a fact.

Just like the top ranked universities do not necessarily provide the best possible education, top ranked firms may not necessarily provide the best service, especially to smaller clients. Research has shown that small universities provide A low teacher-to-student ratio which provides a more intimate classroom experience. You will be able to have more frequent, and more valuable contact with your instructors. Again, class size matters, and at a small college you can expect fewer people, which means fewer distractions. Similarly, smaller firms provide a more intimate client experience. The Partners are more easily accessible than not. They are not busy playing golf or indulging in other marketing activities although many actually do so ! 


Regional change

In the past, associations and networks were often centred around US and European firms, but we are now seeing new networks developing in South-East Asia, South America, Japan and India. These operations are looking for members in other territories, particularly the US and Europe, and are being led by the strength of the demand for accounting services in certain countries.

Branding yes, but not necessarily improvement in the quality of service

It can be said that membership of an International Network is merely a transitional branding benefit, which can be changed to meet wider commercial opportunities in the accounting marketplace. Does, the client get any benefit from this, finally, with regards to the quality of service enjoyed?

Finally, a summary of what could be the Advantages

Joining an international network is not that bad, after all. The main benefits could be summarized, as below:

-Professional Associations : Getting active in professional accounting associations opens up networking possibilities.

-Conferences and Seminars: These provide fertile ground for making valuable connections

-Local Networking Events: Keep an eye out for neighborhood business meetups and mixers.

-Online Platforms: In today’s digital era, a strong online presence fuels in-person networking.

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