Outdated accounting systems are holding back many businesses from achieving their true growth potential, according to industry experts. One of the main reasons for many companies persisting with old systems is simply because it is difficult to know which system to upgrade to.
One expert on this issue recently spoke about the problems businesses face in this situation, and how to best navigate through the upgrade process. Nick Longden is the Chief Revenue Officer at financial management software solutions firm AccountsIQ, and he believes indecision and confusion are the main culprits for the continued use of outdated accounting software.
A ‘Myriad of Options’ Makes Upgrading Difficult
Longden believes that it is difficult for finance leaders to upgrade accounting software due to the ‘myriad of options’ available. He also cites the many other priorities that businesses have which often sees the upgrading of the accounting software postponed.
The problem with postponing the upgrade though is that growing businesses won’t have the necessary systems in place to handle scaling up.
“If you haven’t got the right controls and processes in place,” says Longden, “There is also the potential for fraud as the business owner can’t oversee everything in a growing business.”
Accounting System Upgrade Solutions
Longden states that growing start-ups are often just as likely to postpone accounting system upgrades as businesses that are expanding through acquisition. He explains: “In a start-up, the owner will have a handle on everything, but this control is devolved into different teams and departments as the company starts to grow.
“The software has to evolve and grow with the business. Managers need the comfort of having a certain level of visibility and control even if they’re no longer involved in every decision.”
Any upgrade solution needs to reduce the time needed to process transactions, using technology that can automatically process information. This would provide different departments with a certain amount of autonomy that is vital for a growing business.
Cloud-based System Providers for Growth
Longden asserts that cloud-based systems are the ideal accounting solution, but recognises the difficulty in identifying the right provider.
Each business needs to figure out which aspects of a provider’s services are more important. For example, one business may rely on accurate budgeting and forecasting, while another business may need a provider more focused on integrating with other systems for ecommerce purposes.
How the company intends to grow is also a factor to consider when seeking out a cloud-based provider. One provider might be ideal for a start-up with 10 staff, while a completely different provider will be better aligned to a company with 300-400 employees.
Longden’s advice is to ‘embrace the change but plan well’. “If you don’t embrace change at certain points in the evolution of your business,” adds Longden, “you’ll effectively be going backwards and be overtaken by your competition.”
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