Warning Signs -  Is Your Accounting System Failing?

I want to discuss some of the biggest warning signs that can answer the question is your accounting system failing? Some good questions to start with when your evaluating your system: How long does it take an individual to compile month-end reports, or how much time do you spend waiting for the system to respond? Answers to these questions will help you identify potential ROI in upgrading to a modern system.

Performance-related issues

Many times one of the first things users start to notice is performance-related issues. The old database is typically not equipped to handle years and years worth of data, but what does that mean for your company? Frequently it means your data must be archived, which makes it less accessible. Some of the smaller, entry-level systems will even crash when the database gets too large, and these crashes cost time and productivity.

Compatibility

Older technology is often not compatible with newer, windows operating systems, and sometimes incompatibilities with antivirus programs cause errors and bugs in the legacy ERP programs.

I worked with a client who was running payroll in a legacy environment, and a modern antivirus was incompatible with the way the payroll database processed information, causing lost data and constant rebuilds. 

When a system requires an understanding of the database structure as well as how to rebuild and make corrections, it leaves you reliant on a support representative from the software publisher or local consultant.

The Excel band-aid

We all love Excel, and it can be a great tool, but it shouldn't replace functionality, it should support it.

As accounting software consultants, we have even been guilty of using Excel as a band-aid to fill the gaps and help companies maximize their investment in their legacy systems.

One disadvantage of using excel as an accounting program includes user error, and one mis-typed number can throw off many different calculations in the spreadsheet. Plus, more complex spreadsheets typically mean those spreadsheets can only be managed by a few expert users – again, creating a reliance on someone with advanced technical knowledge. This is costly, but can also be devastating if that person is unavailable or leaves the organization.

Disparate programs means double entry

Do you find that important data is being housed in different "silos?" Having multiple non-integrated systems can cause a serious disruption in your business. When systems do not talk to one another we often see users duplicating their data entry efforts in multiple programs. There are obvious inefficiencies with this process, and double entry also tends to expose human error, resulting in inaccurate information. 

When we have an integrated system we can rely on the output of the software, allowing us to trust our data, and get access to it in real time. 

Legacy accounting systems often provide tools for manual import and export capabilities so that data can be shared across multiple programs, but this process is typically more labor intensive. A modern accounting system provides us with tools that allow us to schedule imports and exports and also allow us to utilize newer technologies to connect software endpoints for a seamless integration. 

Pulling it all together

If your organization is experiencing any of these accounting software failures, it's time to quantify their impact on your business to determine if implementing a modern accounting system will provide you the the ROI to justify a change.