How do you know when it’s time to update your financial systems? How do you accurately assess your company’s needs and find the right solution in the age of Cloud computing? The Proformative webinar “A CFO Story: When It’s Time to Upgrade Financial Systems & Do It Right—Hello Cloud Accounting” aims to answer these and similar questions. The webinar was held on November 1, 2012. Tom Brennan, VP of FinancialForce.com and Scott Travosos, CFO of Blue Shield of California, dove into the topic.
Understand the 5 Signs That It’s Time to Upgrade
As a financial executive, it’s not always easy to make the right decision when it comes to choosing the best financial system for your company. Your current solution may work fine. How do you know when it’s time to switch? Fortunately, there are a few telltale signs to show you when it’s time to upgrade.
Here Are the 5 Reasons Why People Change Financial Systems:
- Business-driven decisions
- Technology-driven decisions
- Corporate decisions
- Business combination decisions
- Vendor-driven decisions
We’ll discuss each of them in turn.
Business-Driven Decisions to Change
There are many reasons why your business may be driven to upgrade financial systems. It’s possible that you need to improve current financial process, update your procedures to meet auditor requirements, or adjust to growing pains.
You Need to Improve Business Processes
Are your current processes relying on manual systems? Are you systems disconnected? If your company is experiencing long cycle times, problems with closing your books, or missing out on opportunities, then your organization might benefit from an update.
Auditor’s and Banker’s Evaluation Is Unfavorable
A clear-cut sign that your financial systems need an overhaul is an auditor’s report that values your company unfavorably. If your auditor strongly suggests that you need to improve internal or external controls, then a better financial system might be the right solution to the problem.
It’s possible that your business has outgrown the system you’re currently using. Some financial systems are specifically built for smaller companies. They’re fine to use when you’re starting out, but maybe your organization has outgrown its financial system by now. Adding additional controls, more sophisticated reports, more users, or a larger volume of transaction may not be possible with the system you currently have in place. That means it’s time for a change.
Technology-Driven Decision to Change
Your current technology may be obsolete and no longer supported. It can be difficult to find employees who have the skills to use your outdated technology. You may also be ready to move to the Cloud or a new platform. Last but not least, your company may require 24/7 access to its financial information that your current system can’t provide.
Corporate & Business Combination Driven
Changes in leadership and global expansion can lead companies to upgrade their financial systems. Additionally, adding new lines of business and products can make it necessary to upgrade. Companies that are constantly re-organizing, or participating in mergers or acquisitions may also find it necessary to upgrade more often. Last but not least, new reporting needs could be your catalyst for change.
Vendor-Driven Decision to Change
Your company may need to change financial systems if there is poor or discontinued support for your current systems. Acquiring one or more new vendors that utilize superior systems may also lead your organization to make a change. Lastly, when the costs of your current system are high or unpredictable, it might make sense to look for something different.
Reasons to Move to Cloud-Based Accounting
One reason to move your financial system to the Cloud is that everything else is moving to the Cloud as well. Finance and accounting often lag behind other departments, but that can hurt your organization as a whole. When your financial system is in the Cloud, it becomes easier to leverage your other Cloud products. The Cloud also promotes employee engagement due to the easy accessibility of data.
Additional reasons to move your finances to the Cloud include the following:
- Easy customization
- Regular updates
- VPN access is no longer required
- Data is accessible on mobile devices
- You can use workflow approval rules
- Cloud systems are familiar to non-finance staff
The Cloud Represents the New Way of Doing Business
Some businesses are reluctant to move some or all of their business operations to the Cloud, but Cloud computing has become the new way of doing business. And if your company doesn’t participate, then it will fall behind. As it is, social media is already dominating life for most people at home. And these people expect similar applications at work.
In addition to that, your workforce is more mobile than it has ever been. You may have employees working in different offices around the world, from home, while they’re traveling to your clients, or while they’re attending family functions. It’s necessary to improve your business communications by moving your financial operations to the Cloud.