Jul 21, 2020
The Business Data Revolution With Emily Ridley
Josh: G’day everyone out there in podcast land. I've got Emily from Emerge Advisory and she's going to be talking today about the data revolution and is your business ready. And it's probably one of the more interesting times that we've been living for anyone that's alive, in the amount of things that have changed, with pandemics, and businesses closing down or accelerating and going all over the place. So I guess, Emily, tell me a bit about what you can do to make sure that your business is ready?
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Emily: Hi, Josh. So it's really all about using the tools that available already and using them to your best advantage. So having the right tech and having the right app stack is absolutely crucial. So it's about finding out how you want to do your business. And there will then be a system or a process or an ease to make that digital and bring it to a wider audience, and using remote circumstances that we've all, you know, enjoyed recently and making that happen, but making that work for you so that you're getting the best out of your business and your best business is going to your clients.
Josh: Yeah, that makes sense. So like, I guess, I know myself when we started out in business, we're using QuickBooks, and I'm not going to say that any products better than another, it was an application that I wasn't comfortable using. And I'm in the IT field. I wasn't comfortable using SSL. There's too many bells and whistles and things that I can click in here that are going to do something that they shouldn't. And a lot of the time you have this stuff with it using for years and years and years. And now we're not using QuickBooks, we’re on Zero. But we used to suffer for years and years and you might not be using it properly or to the best of your ability. And I know that a couple of packages that were introduced to would be now 18 months ago, two years ago, Receipt Bank, I thought is an amazing way of speeding up your process for any of your bookkeeping stuff that people should be using if they're not aware of it, and then obviously making sure that you've set up their appropriate rules and reporting so that you have that information coming out of Zero, if that is the product you're using, or whatever the product you’re using. Tell people a bit about Receipt Bank and other tools that you know that might be useful for them to consider if they're not to make sure that they are embracing the data revolution as they should?
Emily: Yeah, sure. So Receipt Bank, Hooked Up, Easy Bills. They're all very similar applications. It's a matter of finding the right user interface for you. Zero now owns hooked up. So it's now free in most business subscription. So it's that minute in itself is an amazing way of wanting to adopt a service. And basically what that does is it just takes all the legwork out of doing data entry, particularly for you spend money transactions or your accounts payable. You take a photo or you forward on an email. It goes into the system, the software I use is OCR, it actually reads that receipt. So it understands the day the tax implications, the vendors, and it will then on the first instance, it will ask you where to code that in your chart of accounts integrated with your accounting software. But it's machine learning, and it constantly wants to follow what you do and how you spend your money. So it will learn it. Caltex, for example, is always fuel and it will learn that. Telstra is always telephone and it will learn that. Aegon is always energy bills. And so as you take the photo, that seamless data entry then goes all the way through into your accounting software. You pay your bill. Now if your bank account and if you use an accounting software, my own Zero, QBL now, that's got live data bank feeds, it will just find a match that transaction. So your actual input into our case in that transaction where it needs to go is as in depth as taking a photograph and then pricing okay, at the other end of the software, it's quick, it's efficient, it's easy, and it gives you more time to spend on your business rather than in your business doing all the stuff that, you know, traders hate to do bookkeeping, that's essentially what this is.
Josh: It’s digitising their shoebox of receipts that they given at the end of the month. I'm pretty pedantic with the way that I still do stuff. But I'd imagine that you have these half failure receipts in their car inside on their hot dashboard, and they're all stuffed, and it's easy just to jump onto it and take a photo of it.
Emily: It really is, as you put in the keys in the ignition of your vehicle, snap that photo and it's as quick as that. And then you can throw that receipt either in gold box or even better, you can throw it in the bin and completely accept digital copies that don't fade and they don't get coffee spilt all over them and they don't get lost. Yeah, it's a really efficient way of having all year, and all your accounts in order, particularly at this time of year when people are getting everything together for the end of tax time.
Josh: I completely agree and everyone should be jumping onto that.
Emily: Actually, it's free if there's software's built in. There's some amazing services out there. And like I said managing your accounts payable is just one but there's also for managing job management. Again, for traders there's Tradify and service may, which will do your task management, your staff management, your time sheets, and your invoicing all in one place as well. So it means at the end of the day, all your jobs are done, and they're in your accounting software, you don't have to finish your day of work, and then come back and sit down and do your bookkeeping. You can actually sit there in the garden with a beer or watch the footy when it's back on TV.
Josh: Perfect. Having that time to yourself should be time yourself and a lot of business owners when they jump in there, they think oh, I'll have to work 40 hours a week I could do this bit I'm going to be earning more money, and then then they realise that they have all list of administration stuff that is zero dollar tasks, they're sitting there doing an entering stuff and it just takes them a hell of a lot more time than what it would have otherwise. So these little hints and tips definitely helped. We've got a lot of clients using another product called sim Pro, which is a fantastic product, not that I'm plugging their brand, but I noticed that when you're going through the different ones, I was like, oh, that's one that we that we use quite a bit. With the data Revolution, the way that data moves between systems has changed a lot over the years. And I've noticed more and more now as people are using Zero, I can set it up so that that invoice automatically sends to Zero when they send it to my email so that way, it can be transcribed without even have to go through services such as hub dock. If you've got somebody sends you an invoice doesn't integrate with Zero directly, you can pretty much do anything with hub dock, even if it's a multi page invoice and whatnot. Is that right?
Emily: That is correct. Yeah. So and it's a filing system. So unlike receipt bank, where the invoices come in, they're dealt with and then they go to archives which then becomes its own digital shoe box really, inside of a hub dock, every Telstra invoice will go to the Telstra folder, every origin invoice will go to the origin folder. Both systems have what they call a fetch service now. So if you have an online account for origins, Telstra, and some of the really big suppliers that you use on a regular basis, it will actually go and get those invoices and statements for you. So you don't need to upload them at all.
Josh: I'm learning stuff everyone guys, that's awesome. I'm going to be making sure to set that up. Because sometimes, it's just … the time that you spend is taking it from one system to another and it can be quite frustrating. How does that work if your suppliers overseas or you've got a non-GST items, or what would be a good for instance, just a software subscription service for a company server in America, is that something you just set the rule up once? And they have to go through email or is the fetch service purely Australian Base. So how does that work?
Emily: So the fetch service was actually started in Canada, hub dock was originally a Canadian company. And so there are a huge number of global enterprises on the firm that range from European base, to Asian base, to Australasian and yeah, and the Americas as well. So it's incredible the amount of scope that you do have, certainly all the big hitters that you'd expect around there the global entities because one it's machine learning and two, actually the OCR, they actually reads the receipt, it picks up whether or not it's GST, or whether it's nil value GST, so if you're in Australia and you've got an invoice that's got VAT on it or New Zealand GST, it will pick that up and bring that in as a nil balance, because it understands the difference between what's required in Australia and essentially what's not a GST code.
Josh: That's cool. One of the tricky ones that I always know I end up doing manually is when I get the car. They have to break down this the stamp duties and offices instead of the CTP elements and everything else, does it deal okay with that sort of stuff?
Emily: See, if you set the roll up once so that your department of Main Roads comes in and you want to separate that one line item into two line items. So you've got your GST component, your GST free component so that it adds up the amount payable. Once you set that at once then yeah, it will read it at rego but it is difficult for in the first instance because there's always two numbers on it. It's asking you do you want to be six months or 12 months? So generally, it would still flag up and say what exactly what do you want me to do with this but it will try and preempt that as much as possible. So essentially, you're just an answer it whether or not you want to split. So we will split the invoice into two components but because you've set the rules to do that, but it will ask you which figure is the final closing figure, which one's going to match your bank statement, essentially.
Josh: Cool. Well, we're talking about integrations. Obviously, that's what we've been touching on a lot. And like the eight year has a whole bunch of different rules and regulations and bits and pieces. And they have built a few really cool integrations with Zero that has been helping out with a lot of like the job keeper stuff with some of their calculators just help make everyone's life a little bit easier. What have you seen that they've been doing lately that have really been helping with some of their integrations to the way that the systems work?
Emily: With the ATO? [Yeah] As much of about the ATO on a regular basis. The ATO has done some amazing things, the unimaginable things. And in the last three months, it's system software programs that just did not exist and weren't on anybody's workflow to exist at any time. And now they’re here. So the job keeper lodgement process is about as simple as it can be in order to be effective. Today’s the first of June so we're now able to lodge our may declarations. I've already done 19 today, so I've sent them out, I've got them back signed using electronic signatures. And I've just digitally entered that into the ATO portal. So it's all launched and confirmed. Now my clients can expect to receive their payments in about four or five working days from there. That in itself is a long, long way from where we were just even seven weeks ago when we were trying to work out what the legislation around job keeper was. So the fact that they're they're taken on board advice from accounting software providers such as Zero and it also from you know, the taken advice as well from industry.
So I know Matthew Addison, who is the director for the Institute Certified Bookkeepers, for example, the ICB had an awful lot of say, and an awful lot of to kind of relay messages from what it's like to be the end user trying to manage these workflows, trying to manage this legislation, trying to get this data from our clients to the ATO as quickly as possible to get this money move in and be where it needs to be. So yeah, what we considered was a luxury 12 or 13 weeks ago is now going to be, I feel, part of our everyday new normal. This just allows for a huge amount of new data, new business calculations, new information. Every business owner in Australia, I think this becomes the beginning of a new revolution. And like I said, for the new normal, and I think at some point, every business and every industry is going to benefit from it. I think the opposite here are amazing. What we can do in a tiny amount of space and how much data we've got available tools to do that.
Josh: You hit the nail on the head there when you're pushed into a spot that you have no other place to go but forward. They've definitely done wonders with the time that they've had. And I think it’s shown a lot of people how they can work remotely and how they can achieve big things. Like I'd love to say that all businesses always keep their books up to date. But I think you would know better than me that that's a big fallacy.
Emily: Yeah, it's not realistic at all. But it can be so much easier than some businesses allow themselves to believe. It can be so much by bringing in automation, by bringing in systems and services that help rather than hinder. By taking away a lot of data entry or duplication. A lot of businesses can be more up to date than they realise, and a lot faster. And they can use that information in ways they've never been able to use it before. I think it gives a huge amount of opportunity for now for businesses to explore things that they never thought that they wanted or needed, but what they're going to see is essential in a very short amount of time. Things like budgeting and cash flow forecasting and data management and making those decisions with that it's all possible without too much disruption to your day to day work in life.
Josh: I think ultimately the big thing that's going to have changed with this is businesses that might have been getting everything in just by the deadline are now being rewarded. To make sure that as you pointed out on the on the first of each month, while job keeper is available, everything is ready to go reconciled and on point so that they're making better business decisions and with enough repetition over time, that should become conditioned to be ongoing past when the job keeper disappears, hopefully. Is that what you think's going to happen? Or do you think people will start to slip off afterwards?
Emily: No, I don't think people will start to slip. I think because having this information in this real time data in this world today is knowledge, and I think knowledge is power, and it gives you the power to manage your business in a in a whole new light and a whole new way. I think that compliance is a sidestep, it's something that is going to be available to you to do much quicker. But for me, using that information to your advantage, not necessarily the ATO advantages you know it's data that's it's your business, it's your livelihood, it's your growth and your development. And you can absolutely do some amazing things if you have that knowledge and you have that power.
Josh: We're going to make the right decisions and you're able to see how much am I buying of something? What am I doing with something? How efficient is the team? How efficient is my buying power and make better decisions? Is it a good idea to maybe set up an account I know myself? One of the things that have come to light for us over the last few months, we've had an account with two major IT suppliers in Australia, and I was looking through only because we changed bookkeepers and I was looking through, and I went, we've got a lot of transactions here, that's from the same company. And so we've made the decision to set up accounts with a few different companies. And that will now mean that there's less bookkeeping, less backwards and forwards, faster response times for our customers. But it's only after really having that data to be able to see that and be able to make that decision that will ultimately give a better customer experience for our customers because they're not waiting for credit cards to clear the audit things instead of the way out straight away. And it means less reconciliation, so better experience for bookcases and easier for us to sort of rummage through everything. So it can't be anything bad happening from this change. And it's just about everyone getting ready to do it. For a lot of people in through the state of depression, we've got businesses that we work with, they're at 450% at the moment versus when they went into COVID.
Emily: That's an amazing story and quite an extreme perspective. But I do believe that though, I think that from a bookkeeper and accountant perspective, I'd, again, never been busy and never done so many hours on the phones with the ATO, catch up legislation, do the data entry that's needed for all the new compliance around shopkeeper and cash flow and boost and other stimulus packages. But, it's, yeah, so it certainly has given a rise to like a new normal. And what you were saying though about the data that you've got access to so with the date to the transactions that you've been able to see you can actually see there in real time what you're spending with those suppliers, which gives you, you know, power to negotiate terms. It can, you know, a five cent save and goes directly into your back pocket on your bottom line for your profits and that money is much better off in your pocket than in your supplier’s pocket. So it's huge what you can do with a tiny little bit of information and how far that can take you. It's an amazing concept that I hope to be able to offer to an awful lot of customers moving forward, to sit down with them and say, this is the data you have, and these are the opportunities that you have with that-
Josh: It’s data in, data out as they say, you can't make a decision if you don't have good data going in. And you do an amazing job at making sure that people are having the best quality data going into they can make the best decisions with their budgeting, forecasting and making sure that they're doing the voodoo that they do well and are able to continue doing that and as you said. I can see some trends, one of the ones that my partner saw was, she has a hair makeup business, was if she was to purchase all the items that she purchased over 12 months, just the core items that she's purchasing quite regularly in one bulk amount and they're all things that don't have a shelf life, she would have been able to have a 15% advantage. I said well that sounds like a good idea. As long as they're not things that are going to sit on the shelf for 10 years, you're never going to use them but without data, you won’t be able to see that, you wouldn't be able to make that decision. So where do you think the data revolution is going? Where do you think businesses are going? We've always had these huge changes over the last three months, and there's going to be more changes. What are the things that businesses should have in place that already exist? And where do you think it's going? It’s the doozy question.
Emily: It is, isn't it? I don't know, to be honest, I don't know where this is going. I don't know the end of this is, I cannot know what the end of the internet is, and I don't know, you know what the end of the universe is. I know that the opportunity is immense. And I think that there is a huge amount of opportunity for development, for growth, for profit increase for every industry out there based on the back of this. I think that the digital revolution is absolutely going to change permanently, the way that we work and the way that we interact, but what's going to be more important than any of this is then that human interaction at the end of it. We're going to want to talk and know the people that we're dealing with, rather than just having an ether of mindless data and send out things like you know, like your accountant will send you out your financial statements at the end of the year, which is just pages and pages of numbers. But without having a conversation about what that means and what you can do with that information, it's kind of lost its purpose. So, where do I think this is going, I think this is going to bring those closer together by making us work further apart. I honestly do believe that. But I also think that Australia is going to be a big player in the global economy on the back of this. I think that we've got more power than we realise. We don't really have the internet speeds that we need, but we're getting there slowly. And I just think that we've got more voice that we believe that we have, I think we just need to be a bit more confident, a bit louder about who we are and what we can do with the data that we have. I think we've got some amazing tech out there that might just be a little bit lost because we consider a small Big Island and a small fish in a big world.
Josh: I think what you said there encapsulates it perfectly where automation does not mean not personalised, don't keep it robotic, keep the bits automated that you don't like doing and then the bits that you do like doing and making sure that you have that face to face time, you're able to use the data then see what people's numbers are doing. One of the things that we noticed in our business, so we do set price IT for everything and give unlimited support, and guaranteed uptime from that IT support each month. What we noticed when we started putting these in place was customers weren't having things break. So this was sort of what are we paying you for. And so you need to make sure that you're you had that relationship and you were still going and seeing them and you're making decisions with them on where the future of their business was going, and it let you have those better conversations because there wasn't fires that you're putting out. And that has definitely had the people that we're working with we've built better relationships with because they're also not look looking at the clock going, oh, man, you've got a pointing on my clock, anyone who's listening. He didn't, they're not worried about how much they're paying you per hour because they're able to sort of see the value that you're adding to them, and you're actually sitting down and listening. And so definitely, don't keep it robotic, just wish you've automated it, make sure you keep it personalised and keep that relationship because that's ultimately all we’re in business for is to work with people we like working with.
Emily: Absolutely. And it's that makes a good business a great business. And also the same way we charge up front fixed fees on everything. We don't have an hourly rate for anything at all. We're very open and honest about what we charge and we base our charges on outcomes. So what is it that the client gets out of it is how we manage our pricing around that.
Josh: That’s definitely a really good model. We're nearly at the end of the podcast here. Is there anything else that you'd like to cover off on?
Emily: I don't think so. Just recapping what we've said, it's just a really good time as we're, you know, moving through the COVID process, I guess as to as to what the outcome of that is actually going to be and what the new normal, essentially it's going to like at the end of this, I think it's just a really good opportunity to look at systems of businesses or processes and look at the changes that you've already had to endure over the last seven to 12 weeks and see where that can take you in the future, which I think is a really exciting opportunity to do that.
Josh: I think we're all walking in this game together and, and looking forward to see we get on the end. If anyone is looking for someone that's going to be able to give them some more advice, definitely reach out to Emily at Emerge Advisory. She's going to help you out and go through any of the details. Make sure you've got that data to make those decisions.
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