August 23rd, 2010
by Robert M. Callanan
Many companies start out using entry level, off-the-shelf accounting software such as QuickBooks with tools for basic accounting and business management. QuickBooks is easy-to-use software that enables start-ups and small businesses to get their accounting and finance departments up and running quickly. While QuickBooks may have served your company well in its early stages, there comes a time when your business outgrows entry-level software.
When It's Time to Move Beyond QuickBooks
There are five tell-tale signs you've outgrown QuickBooks, indicating you should consider moving to a mid-range accounting software:
- Cannot handle increased transaction volumes
- Cannot adapt to business growth such as new locations or lines of business
- Users are taking turns with the system and are having to wait to use it
- Outside parties such as customers, investors, lenders and vendors are demanding greater access and timely retrieval of detailed, secure financial information
- Other performance issues such as length of time it takes to load and print reports diminish your efficiency and productivity
You know it's time for a change, but what comes next, how do you get there, and can you afford it? Here's a system-agnotstic overview of mid-range accounting software.
Mid-Level Accounting Software 101
Mid-level accounting and enterprise resource planning (ERP) systems support more functionality and a broader range of reporting. There is an underlying database that can handle large numbers of transactions and easily scale from one to over 1000 users. This is most frequently accomplished by purchasing more user licenses and/or acquiring more powerful or additional servers. Because the database is more robust, mid-level accounting software is more scalable and can change and adapt to a growing organization.
Key Features of Mid-Range Accounting Software
Mid-range accounting software enables your business to make more informed business decisions and lets your people work faster and smarter:
- Supports a greater number of active, concurrent users
- Supports a much higher volume of transactions
- Provides controls for data security and integrity
- Provides specialized, complex features such as multi-currency and multi-language capabilities, warehousing and distribution, human resources and supply chain management, and extensive inventory needs such as multiple costing methods or bill-of-materials processing
- Generates much more powerful business intelligence and reporting
- Customizes according to role, industry or business process
- Prolific availability of third-party add-on software for specialty functions and seamless integration
- Automates business processes
How to Move to a Mid-Level Accounting System
When a business implements new accounting software, it cannot stop day-to-day activities to install, configure, and test a new system. It also cannot expect to use a new system without considering improvements to existing business processes, training end users, and migrating historical data. For these reasons, your choice of a solution provider carries as much weight as the new software itself. Here are important traits to look for in service providers:
- Understands Your Business and System Needs. A software provider should thoroughly understand your business and business processes by listening to you and asking good questions.
- Exhibits Exceptional Knowledge about Their Product. Your provider must thoroughly understand the functionalities, capabilities and intricacies of their solution and coherently explain them to your end users.
- Knowledge of Other Products and Solutions. A good solution provider makes sure you understand what you are looking for, knows ahead of time what the expected returns and benefits will be, and recommends a solution that is truly the best fit for your company.
- Proven Approach to Implementing. Mid-level systems require more planning and testing because there are many different configuration options to make it adaptable to your business processes. Excellent solution providers have developed a solid approach that is explained to you.
- Good Communication. A top solution provider communicates with you about project status and budgets. Also, your provider should prepare deliverables for you, including procedures documentation, end user training guides and more.
- Pays Attention to You During System Cut-Over. When your company starts using the new accounting software, your provider should still pay attention to you, check in to make sure things are working as expected, and provide support and training to your end users.
- Provides Ongoing Support. As your business grows and evolves, you want assurance that your provider is always looking after your business – recommending improvements to business processes, assessing new modules or tools and their impact on your business, or offering user groups where you can interact and share ideas with other end users. The best solution providers make these and other services available to you for as long as you own the system.
Mid-Market Accounting Software is Affordable for Small and Mid-Size Businesses
Companies still in start-up mode minimize major capital expenditures, and implementing mid-market accounting software is no exception. However, there are costs to waiting too long. When you outgrow your entry-level system, there is a tendency to develop inefficient workflows or to learn to make decisions without all the data. As these tendencies become entrenched in the culture of your firm, moving to a new system suddenly requires much more than just a new license. People require retraining and processes require review and reengineering. Waiting just one or two years can more than triple the costs of moving up to a mid-level system.
The good news is most mid-level systems offer a lower cost of entry than many realize, especially when the implementation approach used by the consulting firm is optimized for a small business.
Conclusion
When your people have the right tools and know how to use them, they can overcome the most complex business challenges. For growing companies and larger organizations, mid-level accounting software helps you surmount business management challenges and more effectively contribute to the bottom line. By providing ready access to relevant information and processes, mid-level accounting software helps drive positive business outcomes, including competitive advantage, increased revenue, and strong partner and customer relationships.
Resources
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Robert M. Callanan, CPA, is President of Business Ready Solutions, LLC, a Microsoft Gold Certified Partner in Durham, NC that implements and supports Dynamics GP accounting and ERP software and provides accounting and business process consulting.
