The evolving nature of industry automation and why CFO’s can’t afford to be left behind
Cloud accounting ledgers were cool in the twenty-tens with the emergence of companies like Xero, Quickbooks and MYOB amongst others. If you joined the accounting Software as a Service (SaaS) bandwagon in this period, you are officially an ‘early adopter’ and were ahead of your time. Now it's all about extending the power of your accounting software with automation.
In 2021, having a cloud accounting ledger as your distributed business management platform has become a need rather than a novelty. The benefits of an always accessible, up to date centralised data repository with automation features is undeniable and well documented. However, adopting a cloud accounting ledger alone is not likely to put you ahead of the competition.
Today, the real power of the cloud comes from connected ecosystems of powerful ‘apps’, which can solve big business challenges. A combined stack of complimentary apps can propel a business to market dominance.
“The success of firms in the knowledge-based economy is increasingly dependent on their ability to innovate”- Gerard Grech – CEO at Tech Nation. What this means is that for the future success of your company making the transition to an appstack is vital.
Data from OKTA shows that SME’s use 75 apps on average… 75 apps! and according to Eurostat and Deloitte, in 2019 both the UK and Australia have seen huge growth in companies adopting cloud based applications, with over 40% now implementing some form of automation strategy.
Inferring from this, there is a good chance your competition are already at an unfair advantage and are already taking advantage of the efficiencies and reaping the benefits provided by a tailored appstack. In a fast paced world where the quick eat the slow, failure to adapt is the first step to becoming obsolete.
No appstack, no future!
I’ve personally worked within the business app ecosystem for more than 10 years and worked with thousands of businesses to help implement Lightyear and various other applications. Within that time I've seen some brilliant app strategies, and some not so brilliant app strategies.
Below, we have broken down some of the benefits and things to consider as well as an implementation plan to get you started. There is a fabulous community of app advisors which we will happily connect you to, just drop us a comment below.
What is an appstack?
- Horizontal Apps are broad and solve pain points most businesses experience, such as expense management, payroll, HR. They do not typically have industry specific features.
- Vertical Apps are industry specific apps that are designed with specific industries pain points in mind. Examples could be warehouse management or Point of Sale for retail.
How do I choose the right apps to extend the power of my accounting software?
There is a large ecosystem of apps out there and sometimes choosing the rights apps to suit your business needs can be difficult. If you implement the wrong app it can cause you serious problems so due diligence is very necessary.
Evaluate your business needs in detail. Create a scoping document.
Do your research! Don’t cut corners here, implementing a system into your business is a big investment of time and money, you must invest time to pick the right app. Engage a professional if you need help.
Evaluate the value, not the price. On the face of it, some apps are very similar but the devil is in the detail. A common mistake is to take the cheapest option, which can often cost you more money in the long run. Evaluate the functionality of each app and how much time and money it will save you. Often the extra investment pays dividends in the long run.
Create a shortlist based on the needs of your business.
Ask each app for a demo and ask what they do better than the competition.
Try before you buy. Any good app will offer a free trial, because they’re confident in their product capabilities. This is a great opportunity to get comfortable with the apps capabilities.
Make a final decision and invest in an implementation plan.
A good place to start your information journey is through the use of dedicated online groups and social forums/networks such as Facebook, Twitter and Linkedin. This will allow you to speak with people who have used the apps you are researching and you can ask your questions to real people who aren’t paid to give you happy answers. Independent review sites such as Capterria and GetApp are another way to find honest feedback from people who were in your exact position.
How do I implement my apps?
A well thought out implementation plan is critical to success and needs time to evolve.
Dyle Rodriguez Managing Director of Amakari Services accounting firm (formally Head of Digital Migration at Accounts Unlocked) has this to say about moving to an appstack, “transitioning is not instantaneous and implementation, especially of large firms, takes time and for us it was easily 2-3 years including research.”
Now, I don’t advocate that all businesses should take 2-3 years, but a well thought out implementation plan with time allocated to critical steps is essential.
Below are some our tips to success:
Have a detailed plan complete with timeframes for each step in the implementation process.
Get your executive sponsors bought in and involved.
Choose an internal champion to take control of the project and drive progress.
Ensure live training for staff and record the sessions for future reference.
Ensure employees are implementing the changes and following the correct procedures.
Meet deadlines and ensure the project is completed in a timely manner.
Have a program of continual training for existing and new employees. The beauty of the cloud is continuous improvements. At Lightyear we deploy new features every 2 weeks, it is important to stay up to date with new features to ensure you are making the most of the apps capabilities.
What are the benefits?
According to an Intuit study, 70% of small business owners realize the value of connecting data from different apps and existing technology solutions. There are many benefits that the correct appstack can bring you, we have listed a few of the most prevalent below;
Better audit quality using automated audit reports attached to every bill and PO.
Accurate real-time reports showing how your company is doing at any given time allowing you to make better forecasting decisions and allowing you to react quicker to situations.
Streamline communications between your teams to improve efficiencies such as invoice approval times with approval automation apps.
All supplier documents are in one place and easily accessible meaning no lost, forgotten or duplicate documents.
No manual data entry - Lightyear syncs with inventory and accounting software and exports the rich line item data.
Fully automated notification processes so the right person i.e. the decision maker, is notified at the right time with the ability to approve, decline or query from anywhere.
Reduce Debtor days and save time chasing payment via automated reminders.
Ability to take on more complex business processes such as return automation or direct integration with suppliers to expand product assortment.
eCommerce automation guarantees that the right data is processed between your systems in a timely manner meaning you can keep promises such as next day delivery to your customers.
Improved cashflow and forecasting analysis thereby increasing the accuracy with which you make business decisions such as spend.
Significantly reduce the risks to your company with real-time figures allowing you to efficiently react to changes in the environment.
Higher client satisfaction due to better transparency and process agility.
Reduce busywork, increase productivity and maintain quality.
Reducing human errors with pay checks which can help prevent employee loss.
Increased security as everything is password protected and encrypted.
There are many more criteria which must be taken into consideration on an individual basis but the overarching answer as to whether or not an appstack is the right move for your business is simple.
‘With modern cloud-based technology at our disposal, we’re well positioned, like never before, to produce timely clean data, and to surface information for informed decision-making for our small business clients’. - Heather Smith
In our next instalment of the appstack series we will go into a few of the companies that we have vetted and believe will make for a great appstack for most businesses.