Cloud Software – The Competitive Advantage

Cloud Software – The Competitive Advantage

by | May 11, 2016 | Cloud, Competitive Advantage, Small Business, Software

Last summer, International Data Corporation reported that the cloud software market saw $48.8 billion in revenues in 2014, and will continue expanding at a compound annual growth rate of 18.8 percent through 2019. Small businesses have been a major driver of cloud-based software penetration, relying on the more advanced delivery option to keep capital expenditures down and functionality optimal.

Regardless of which industry a firm might be competing in, cloud-based accounting software can help to drive both the efficiency of processes in finance departments and their accuracy. Reporting is a challenging task, and software has been helping to reduce complexity while increasing the value of the data generated and stored. Recognizing the accounting challenges companies face that can be remedied by cloud-based software is the first step toward success.

The problem at hand

Earlier this year, AccountingWEB reported that issues with accounting can quickly lead to fraud, which cost the private sector about $2.9 trillion in 2015, a third of which traced back to small businesses. The source pointed out that errors are most often associated with an incorrect logging entry or some divergence from best practices, which represent 60 percent of the mistakes involved in these processes.

At the same time, the average small business owner will not always be able to expand training, hire more quality assurance professionals or take other expensive actions. Software that automates some of the stages involved and supports users will tend to reduce the error rate and maintain transparent, visible recordkeeping. Taking that a step further, the best options for software in the past were often outside of the budgets of smaller firms.

Cloud computing has increased the flexibility of IT provisioning and offered decision-makers an option that is more easily deployed, managed and upgraded than the contracts of the past. Tackling both the challenges associated with accounting and the cost of maintaining optimal performance management in this area, cloud-based software has opened the doors to a more intelligent future for many organizations.

Digital accounting’s strong suits

CPA Practical Advisor once listed the most common struggles of accounting in small business as accounts receivable, cash flow, managing paperwork, finalizing monthly reports and payroll. The news provider noted that about 83 percent of entrepreneurs who responded to one survey stated that they do not even have the ability to audit financials within their management systems.

When approaching accounting with antiquated processes and practices, these types of issues will often cost companies severely either in terms of budget constraints or noncompliance with industry standards.

Cloud-based accounting software such as Intacct can almost immediately change the ways in which the accounting wing of a business functions for the better. In fact, these solutions will tend to be far faster and efficient in accounting workflows than the technologies of the past, all the while improving user experiences and continuously evolving to keep up with the transformation of markets and operations.

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This content was originally posted by David Furth.

The Rise of Cloud Computing

The Rise of Cloud Computing

by | Apr 6, 2016 | Accounting, Cloud, Intacct, Outsourcing, Small Business

Business Wish They Made the Shift 2 Years Ago

According to Intacct, 89% of firms who have already shifted to cloud-based technology wish that they had made the move two years earlier. The rise of cloud computing is arguably the single most important technology story of the past decade. During that time, countless companies have moved some or all of their IT into cloud environments.

Why?

Because quite simply, cloud computing has a lot of advantages over traditional on-premise accounting. With the cloud, a company can shift a lot of its IT responsibilities to a third-party vendor, while enjoying greater performance. Additionally, the cloud is the less expensive solution, since organizations don’t have to purchase hardware and only pay for the services they use as they go.

Related: 5 Top Benefits of Cloud Technology

In addition to requiring fewer human and financial resources to operate, business leaders are looking to cloud based accounting software solutions because of the deep insights into financial performance that these solutions provide. Today, firms want to look beyond basic measurements and take into account operational metrics as a means to a far better view of how the business as a whole is performing. And to get that level of insight and awareness, more advanced accounting solutions are absolutely essential.

What Metrics Are Businesses Looking to Measure?

Cloud based accounting solutions can keep track of retention rates, customer acquisition costs, customer life time value, fluctuations in monthly recurring revenue and much more, all in addition to accounting basics. With information in hand that is tailored to the specifics of their businesses, leaders have a 360 degree view of the organization and how it is interacting with customers and clients. That depth of information enables more informed decision making and a nimbleness that leads to a serious competitive advantage.

Related: Data-Drive Approaches Guide Businesses

Why Are Businesses Not Making the Shift?

Clearly, vastly superior information is available to companies who use cloud based accounting and financial solutions, but not everyone has made the change.  Why??? Because change is difficult. We fear disrupting our business routine, we are comfortable with Excel and Quickbooks, we don’t want to bother with training, etc. But switching to a cloud based accounting solution really isn’t that difficult.

We have transitioned countless companies, both large and small, to cloud based solutions, and the one thing each transition has had in common is that EVERYONE has exclaimed over the ease of  implementation and staff training. Don’t worry! Go for it! The transition will be over before you know it, and like 89% of companies already utilizing the cloud, you will be wishing you had made the change years ago!

If you’re interested in learning more about financial planning and analysis in the cloud, check out our eBook below!

Why Use A Fractional CFO or Controller Services?

Why Use A Fractional CFO or Controller Services?

by | Feb 4, 2016 | Blog, CFO, Financial Services, Growth, Small Business

Identify Cost Savings and Increase Efficiency

In order to stay competitive, businesses are forced to examine all aspects of their operations to identify cost savings and drive efficiencies. The companies that do this successfully will be rewarded with increased market share and improved profitability.

The challenge for small business owners is how to effectively conduct this analysis without the knowledgeable resources to do it. Typically, small business owners will try to handle the company’s finances on their own, even though accounting is not their core strength. Consequently, owners can end up with poor financial reporting that impacts their understanding of their business operations.

Specific results of accounting and financial reporting shortcomings affecting small businesses include:
  • Inability to obtain bank financing or raise equity investments
  • The financial complexity of the business has outgrown the capability of existing staff
  • A lack of financial bandwidth on a specific project such as a M&A transaction
  • Inability to respond to growth opportunities due to misunderstanding the relevant financial implications
  • Misperceptions about the origin of profitability

Most Efficient Method for Small Business Owners

For many small businesses, hiring a full time CFO or Controller is not economically viable. However, outsourcing accounting, utilizing a fractional CFO or Controller service to access the financial expertise they need is affordable. On average, most small businesses (subject to size) should only spend between $15,000 and $60,000 annually for fractional services, compared to $90,000 – $120,000 annually to hire a full time CFO or Controller. Clearly, utilizing outsourced fractional CFO/Controller services makes sense for small businesses who are looking to identify cost savings and drive efficiencies.

3 Biggest Tech Trends For Small Businesses in 2015

3 Biggest Tech Trends For Small Businesses in 2015

by | Jul 29, 2015 | Cloud, Entrepreneurs, SaaS, Small Business, Software, Technology

Entrepreneurs are business savvy. They are passionate about success and understand what it takes to grow their companies. Keeping their business at status quo is not an option. Staying ahead of the competition often involves significant investment in technology tools to help manage daily business operations.

Inc.com recently wrote about a survey conducted by Palo Alto Software, where 500 small business owners were asked about their technology habits and plans for the future. The top 3 tech trends they found were:

1. They’re Spending More on Tech

According to the survey, 81 percent of respondents said they were planning on investing more in the coming year. Additionally, 48 percent said they would be willing to spend more than $5,000 in the next coming year on technology. It’s safe to say that technology is valuable for businesses and continues to be an investment many are willing to do.

2. They Operate in the Cloud

Small businesses favor the cloud as evident by the survey that found that 37 percent ran over half their business in the cloud. Moreover, 44 percent said they use more than two cloud-based tools for their business operations. The cloud is on the rise due to the many benefits it offers business owners such as real-time data, remote access and system integration.

3. They’re More Mobile Than Ever

Palo Alto Software found that 89 percent of small business owners use their smartphone to run their business. Furthermore, 63 percent said they are planning on increasing their usage of mobile devices in the next year.

Haven’t Embraced Technology Yet? Now is the Time to Reconsider

If you are a business owner that has not embraced technology, my advice is to reconsider. Start by examining your business processes. Think about how technology could free up time and resources. Look at all the non-value add things that you do every day.

What if you could automate the majority of those items?

Imagine if the time and those resources wasted on non-value added activities were focused on growing your organization. Cloud technologies have brought enterprise technology to small businesses. Solutions are affordable and scale as your business grows. In addition to cost savings, newer technologies bring a wealth of new information that enable you to better plan for growth. Instead of focusing on the costs, examine the opportunities that technology will bring your company.

Top 6 Services SMBs Want from Their Current CPA Firm

Top 6 Services SMBs Want from Their Current CPA Firm

by | Sep 15, 2014 | Accounting, Services, Small Business, SMBs, Technology

According to recent survey published by The Sleeter Group the top 6 services desired by companies currently using a CPA are:
  1. Business Planning
  2. Business Strategy
  3. Create Dashboards to monitor business
  4. Business Analytics
  5. Represent me at Government Audits
  6. Tax planning
Compare that to the top 5 services received:
  1. Tax return preparation
  2. Tax planning
  3. Compile, review, audit business records
  4. Represent me at government audits
  5. Bookkeeping

Why are They Different?

There is a general misconception about the types of services CPA firms are able and willing to provide small and medium sized businesses (SMBs). Lots of SMBs don’t think about their CPA when making technology decisions. And lots of CPA firms focused on the SMB market do not have the expertise or knowledge to make qualified recommendations. Technology is rapidly advancing and enabling SMBs to have access to enterprise quality solutions to provide invaluable information about their company. Businesses who plan revenues, margins, and operating income regularly and compare actual results to these plans will do significantly better than those who do not. Without technology it is extremely time consuming and difficult to get access to the necessary information which leads to many SMBs flying by the seat of their pants.

CPA Firms Should Be Ahead of the Technology Curve

The top 4 desired services can be achieved by SMBs with technology. Large corporations are already using CPA accounting firms for accounting technology services. It makes sense for the SMB market to start to do the same.