Making difficult decisions is a large part of running a company, and most of these decisions revolve around finances. Is there enough money to do this? How can we make more money in the long run? These factors are hugely important to a business, but sometimes they cloud the importance of investment in growth. Accounting is one of the key areas that tend to fall behind in this regard.
Accounting technology is continually advancing, and it’s important that every accounting firm has a system that is up-to-date enough to keep tabs on your business in real time. It seems obvious that a software platform that integrates various applications would be beneficial, but many firms hesitate in updating this information due to the cost. They feel like the return on the investment is not clearly evident. However, accounting firms need to get over this initial reaction and look into the factors that will make or break the installation of this software: efficiency and value.
The first question you have to ask when considering an investment into more advanced accounting technology is whether or not it will make your company more efficient. If the answer is yes, this would imply that the software alone would reduce labor costs, replace outdated tools, and steamline operations. Decreased labor costs are the main key here, as often, older systems require hand-keying or manually importing data into a variety of systems. This takes much more time and effort than an automated system would require.
By streamlining this process, countless man-hours will be saved in the long run, which can, in and of itself, cover the cost of the new software, with the added benefit of getting more done. This means that if the updated accounting technology you install is solely beneficial in terms of efficiency to the company, then you should let the labor costs balance out the cost and never make your customers pay for this new program. If the reason is value however, that’s a different story.
The other potential reason to upgrade your accounting technology is that it would allow you to provide better and more valuable information to your customers, and therefore result in better service. Due to the fact that older systems are so labor intensive and time consuming, this often means that reports are only generated every week or even month.
This is a long time to wait in the digital age, when most of us are able to track just about anything in an instant. New accounting software allows you to track changes as they happen, which can result in more informed decision-making. This is also helped by the fact that a more conducive and integrated system overall results in a greater level of detail within the data, which means that you can move it from program to program easily in order to view it in whatever way you see fit. So you are not only providing data quicker and more frequently, but the data itself is more detailed as well, which increases your value as a company.
If the new software ultimately helps your company give a more valuable service, you can justify having your clients take part in the cost. However, in most cases your company will take care of the initial costs of the change over, you can discuss an increase in your client’s monthly fee to contribute in the long run.
No matter what kind of clients your accounting firm services, it is just a matter of time before they will want the same increased efficiency that they get in other areas of their life due to technology. Don’t fall behind, and look into updating your technology for the future.