“The internet and the communications systems that have evolved out of the internet have enabled us to align the needs of a business with the talent of individuals in a far more precise way than ever in the past.”

Thomas Frey

One of the most potent tools for optimizing resources and costs in the hands of a strategic leader today is ‘Virtualization’. Three areas of application that can give you a competitive edge are

1. Workflows

There is no longer the constraint of location to most workflows. If all information is digitized and available in electronic format, then workflow can be set virtually in the cloud allowing professionals in different locations engage it. Illustration: Our client had an approval workflow for expense invoices that was literally across the desks in the head office. Paper moved from desk to desk and got approved following which it showed up at the accounts desk for payment. Paper was scanned and an approval workflow was designed on a cloud based application to send and alert invoices to respective officials, all transactional entries were made from a lower cost destination and final payments initiated using online banking against confirmed approvals. The new electronic workflow meant faster processing, lower risk of missing or duplicating invoices, avoiding late payments and associated penalties resulting in significant cost efficiencies.

2. Workforce (talent)

“It’s not that offices will ever become obsolete. But companies used to figure that the talent would come to them. More and more, they are going to have to figure out how to get the work to the talent.” – BusinessWeek

“Cyberspace is a vast new civilization, containing places of commerce and an already deep social life…. In time, virtual teams will become nothing special, but rather the natural way to work.” – Jessica Lipnack In “Virtual Teams: The Future is Now,”

“In the Network Age, human, social, and knowledge capital are as potent a source of value as land, resources, skills, and technology. Human capital increases when more people work together in more places, meeting new challenges, and acquiring new competencies. Social capital accumulates when virtual team members vastly expand the number and diversity of their relationships.” – Jessica Lipnack

A Macquarie University study found that 36 per cent of Australian businesses surveyed were already sending work offshore, 21 per cent were in the process of moving some activities offshore, and 12 per cent were discussing it. Now, take the case of the accounting and bookkeeping industry in Australia which is significantly impacted by digital innovation today. Those that decry outsourcing, especially offshore outsourcing need to consider the paradigm shift that is underway. Arguments like data security being compromised, patriotic protection of the local economy and disclosure of where work is being done are becoming outdated. Virtual talent application, whether it is from within a domestic or a global talent pool is being facilitated by this digital innovation to the extent that it no longer raises eyebrows

3. Infrastructure

Information System Design: IT ecosystems are becoming increasingly virtualized. How your accounting /bookkeeping organization adapts to this reality determines how much competitive advantage you can gain through increased efficiencies. Virtualized means that physical boundaries are transcended in the cloud. What does this mean for the accounting services industry? Read more about how the various components of your IT ecosystem are being re-organized for virtual engagement