From XU Magazine, 
Issue 27

Scaling with Xero and AutoEntry

How Armstrong Watson, a Platinum Xero Partner, used AutoEntry and Xero to help them scale...

Sooner or later, businesses will always learn the benefits of keeping up with technology and the perils of falling behind. And that was especially the case over the past 12 months. 

Companies with a trained, up to date workforce, a strong remote working infrastructure and up to date technology weathered the covid storm much more assuredly than their competitors. 

In fact, some organizations, like Armstrong Watson, have flourished in recent months, enjoying healthy scaling without compromising on their offerings to their clients. Armstrong Watson’s clients vary in just about every way, from size to industry and beyond. So the accounting and financial services company has to cater to different needs and levels of comfort with accounting technology. 

To scale, and to cater to this broad base, Armstrong Watson has to be agile. 

Building Out - Choosing the Software 

This story begins about 5 years ago, with Armstrong Watson overhauling their systems. 

“In the first instance efficiency is working with as few systems as possible,” says Richard Woolgar, Head of Management Systems for Armstrong Watson. “We decided some years back that we wanted to improve our internal systems. Our existing software providers were proving intransient in some issues we wanted to address.”

“So we thought let’s look at the whole system. At that point, for about 10 years we’d been using Xero for a bank of clients and it was scalable. In fact, it was scalable for any type of client - from one-man-bands to audit level companies, so we took the decision to move onto that platform for all of our accounts – either client or internal use are on there to some degree.”

“Once you’ve moved it all to Xero, the next question is how to get the data into Xero better. And the first point of that, years back, was when we started using AutoEntry.”

“It was a game changer in its time. It was great for us, especially for end of year accounts. That’s how our relationship started.”

AutoEntry, Xero and the Appeal of Multiple Softwares 

“It’s key to have that data [provided by clients],” says Richard. 

“We put all of our clients onto Xero. The information is only useful if you then have bank feed and invoices fed into it. AutoEntry gives that first step of having data to act on. It gets people used to the idea of the accounts software being the starting point. So AutoEntry was the first cab off the rank.” 

“New clients are given Xero and then AutoEntry. When they see how useful it is in other products and the ecosystem way of working, that opens more opportunities for advisory and system reviews and other processes and services. Clients look at everything from the ground up. It leads to a lot of fruitful conversations. People were used to using one software, but now word is out and people are getting more educated. There are multiple softwares now.”  

The value of a good OCR 

OCR, or Optical Character Recognition, is quite commonplace now. But Armstrong Watson were early adopters. And they believe that not every OCR is created equal. 

“You need a good OCR to get up to date invoices,” says Richard. “From that point it was a no-brainer to continue our relationship [with AutoEntry]. We use it internally and externally. It has made it easier to scale.”

“We’re all working in the same software and system. You get stickier clients, word of mouth. Bank feeds and AutoEntry are the game changers.”  

“Once you have a good system and you invest the time in it, it’s easier to grow.”

“We’ve grown through acquisition too. When you bring additional businesses in, if you still have multiple systems and software, you’ll have different people using it in different ways…having a unified way of working in place is key to growth. You can reap the rewards then – you’ve trained staff internally and given them the necessary skills.” 

“A lot of it is around agility – being technologically agile. Some of our competitors struggled to keep efficiency levels consistent during lockdown. When it comes to winning new work, it’s a lot more problematic if you’re struggling with the work you’ve already got. 

“That was really key for us.”

The Remote Elephant in the Room 

Speaking of lockdown, businesses are now opening their offices (tentatively), but for a year, everything was off-site. This had ramifications for both meetings and passing on information. Prior to lockdown, many clients still gave paper, hard copies of information to their clients.

“We couldn’t go out onsite,” says Richard. “Going onsite has been hit and miss. So we need information to get to us still. We’ve been able to say to people, download this software and you can get stuff to us. What this year has been good for is making people reassess how they work. Previously we sold the idea to clients, but this year they came to us wanting solutions. AutoEntry has been invaluable at that point. You can drop stuff off, or start using this daily. 

“And while you get that [convenience], we get better data, and that leads to cash flow conversations. Clients like looking at p&l but neglect cash flow reporting. We’re pushing an open door and they realise cash flow is important. AutoEntry is the start of that - you know where you stand.” 

Technology and Consistency: The benefits of a tech team 

Harnessing technology and implementing a company-wide system is a steep learning curve for any company - not just for their clients.

“Everything’s a learning curve,” agrees Richard. “We did the work of getting our intel systems onto Xero and then it was just a matter of getting the clients using it. Once you’ve got that in place, you can say now it’s standardised. We have a dedicated central team for that. That’s the approach – because we’re not just talking Xero and AutoEntry, you have to stay on top of all the other apps clients might use. To try and spread that too thinly is a fool’s errand. It’s a dynamic space. Having dedicated individuals upskilled is a lot easier. We have a dedicated team. That was key. A dedicated support team for follow up.” 

“So it’s a good knowledge base to go on, for the higher end we have a dedicated team. 

For a new client we sit down, demo the software, get everyone on board at that point. And that’s the key. If you’re working with a business owner who loves everything in the cloud, but a finance team who’s set in the old way of doing things, it’s never going to take off. If you sit with the finance team and the bookkeeper and make sure everyone is seeing what the changes are going to be and head off problems, because not everybody is on the same page.”  

“Often,  business owners can get carried away, seeing the end results, things like live reporting and other things you can do, but without necessarily the steps people further down the chain have to take to get to that place.” 

Faith in Agnosticism 

While Xero and AutoEntry are Armstrong Watson’s software of choice, they also have to work with clients who use different systems. This is why AutoEntry’s agnosticism is important. 

“Our clients are broadly split between Xero and other software, so whenever we’re picking another software (like AutoEntry, or Spotlight for reporting) it’s agnostic across those client banks. The agnostic angle is very important to us. We’ll never be a one software practice.”  

Empathy - the final ingredient

Having an effective, working, company-wide software system is key to being competitive and capable of scaling, and bringing clients to digital is part of that process. So taking the time to understand clients’ hesitancy is an important step in moving them across the digital divide. 

Richard acknowledges the unexpected benefit of updating your company’s system: “Having gone through the pain of changing our own processes, you can see it from the client’s perspective. It gives you a certain empathy!”  

Armstrong Watson is one of the longest-running and cutting edge accountancy companies in the UK. You can find out more about Armstrong Watson on the company’s website. 

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