ERP
ERP Search ERP Software Financial Software Selection Best Practices

Financial Software Selection Best Practices in Selecting Financial Software

 

III. Putting Best Practices into Action: Solution Requirements

Mid-size companies evaluating Financials software are presented with a dizzying array of choices. Many well-known, large enterprise software companies, following their saturation of the large-enterprise software market, have aggressively turned to the middle market.

While the boldface names of these companies may be friendly and familiar to mid-market prospects, their software is often undifferentiated for the varying needs, constraints and budgets of the middle market. Large enterprise applications from “Tier 1” providers may be stripped down versions of extremely large and complex systems with technology roots that can be decades old, or they may be the same bulky applications with a slightly different name. From architecture to interface, the mid-market versions of these Tier 1 applications are constrained by their past, and often force mid-market companies to accept an unnecessary level of complexity.

Solution requirement: Financials designed for the mid-market

On the other end of the spectrum, Financials packages initially developed for small businesses are also now being marketed to mid-size companies. The problem with these systems is also architectural: an accounting system designed for a small business generally does not scale to meet the functional or performance needs of a multi-national corporation. These financial systems typically don’t offer the sophisticated feature sets mid-market companies require, nor a global orientation beyond basic multi-language, multi-currency capabilities.

Clearly, then, a finance software best-practice selection process starts with a focus on Financials systems designed specifically for mid-market companies.

Real-time information access: What’s required?

Easy, real-time access to enterprise-wide information is necessary to fully utilize the Financials application as a source of business intelligence. Mid-market companies need to be able to rely on their Financials software to answer questions such as:

  • It’s the 20th of the month – what’s my P&L look like today?
  • What can be done during the balance of the month to achieve the company’s financial goals?
  • How will the company’s earnings be impacted if the new U.K. operation is rolled up under EMEA? If it is its own financial entity? What are the tax implications?
  • And many more.

Achieving enterprise-wide, real-time data requires the following:

  • A Financials application that feeds data into a common data repository, along with all other major enterprise applications. This allows data to be extracted easily, in real-time, in the countless permutations that mid-market executives and other decision-makers require.
  • Streamlined integration with other enterprise applications, including legacy software, and existing and future other applications in an enterprise suite.

Choices for cost-effective deployment and low TCO

The total cost of software comprises several components, which vary between on-premise and SaaS delivery. These are summarized in the table below:

Cost Component
On-Premise Software
Cloud Software
Software license Yes, by module and user count No
Servers and Data Center Yes No
Implementation services Yes Yes
Software upgrades Typically about every 18 months Generally 2 or 3 times per year
Implementation of upgrades Yes No
Subscription fees No Yes, generally per user per month

Both on-premise and cloud financial software deployment are viable options for mid-market companies. On-premise software can be the right choice for companies that want the highest levels of control, flexibility and customization over their Financial application. In the near term, on-premise software requires more up-front investment in the business software license, equipment and implementation. Over the long term, the cost of IT support, upgrades and maintenance can be a significant expense, requiring IT staff time to implement not just the Financials application upgrade, but to ensure that its connections with multiple enterprise systems remain compatible.

SaaS or cloud financial systems are now a proven software delivery method for mid-market companies, due in part to their adoption by many large, global enterprises. Subscription-based SaaS software allows mid-market companies to get started faster, and with less up-front investment, with Financials and other business software. Ongoing, the SaaS application vendor handles upgrades and maintenance, and is generally responsible for ensuring that the customer’s various application integrations function properly. That said, whether on-premise or cloud financial software is the best long-term investment requires an individual TCO calculation which includes all the relevant factors for any given organization.

In either an on-premise or cloud accounting software deployment, customization is a second and highly important issue to factor into total cost. In a best-practice financial software evaluation, the flexibility to modify and customize the application to accommodate existing business practices is of paramount importance. Companies should not be required to alter their processes to fit the business software, which carries costs far beyond software implementation.

User satisfaction requires a positive user experience

While most users of Financials applications need the software to do their job, user experience is nonetheless a best-practice consideration. An outstanding user experience begins with the application architecture: today’s best-performing Financial systems – in terms of both application usability and system response – are built on modern, Web-based architectures. Financials applications that are rooted in client/server technology are patently more complex, less flexible and less responsive. When client/server based applications are migrated to the Web, instead of being redeveloped in a native Web architecture, they are vulnerable to major usability and performance problems.

As a corollary, a Web-based Financials application should feature a thin client – the very small portion of the application that resides on the user’s computer. Thin-client applications are easily deployed across a wide geographic area, and are accessible over a virtual private network (VPN) or the public Internet. Whether the Financial system is being used on a desktop computer, a laptop, a compact netbook or a tablet, a thin-client architecture delivers consistently high application performance, despite connectivity vagaries.

A best-practice checklist for global growth

Against a backdrop of economic uncertainty, mid-market companies are a strong engine for global economic growth. Across industries, mid-size companies require a Financial system that will grow to meet global business needs. This system should offer:

  • A fundamental global orientation, including multi-language, multi-currency support, multi-hierarchy roll-ups, flexible (hard and soft) consolidations and inter-company transactions. Beyond this basic functionality, the Financials system should offer capabilities that allow for global data to be seamlessly accessed, analyzed and presented in reports, to provide a global, real-time view of the business.
  • The ability to add new software modules, such as CRM or enterprise resource planning (ERP) seamlessly, thus maximizing the value of the Financial software investment and speeding time-to-value of the new business applications.
  • The ability to add more capacity – both software and hardware – to support greater transaction volumes, new locations and/or more users, easily. Subscription-based Financial applications allow companies to add or even reduce capacity on demand.

Next: Financial Software in the Cloud >>

Financial Software SelectionFinancial Software Selection Best PracticesCloud Financial Software
CRM Deployment

 

 

Share This Article

 

Quote

While most users of Financials applications need the software to do their job, user experience is nonetheless a best-practice consideration.

 

Follow Us
social
social
social
social

erp

Home   |  ERP  |  Manufacturing  |  Supply Chain  |  HR Payroll   |  CRM  |  Blog