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Selecting Accounting Software is one of the most important and, potentially, one of the most costly decisions a business makes. The decision is important because if the right choice is made, internal control of most accounting functions will provide a lower risk of doing business. An accurate method of keeping track of the essential financial functions of the business also will result. However, the decision could be costly if it is made without a thorough evaluation of the current and future needs of the business as well as the establishment of an effective method of determining which software package best meets the requirements of the business. Three of the most important steps to identifying the appropriate software for any company are: 1. Strategic planning for the future. 2.
Identification of tested products and vendors. 3. A selection process that matches the product with the business' current needs and future desires. CTS, a nationally known expert, has been evaluating accounting software for more than 15 years. It believes that "the challenge today is not so much to pick software that works because the vast majority can do the basics well, but to choose the one whose strengths match your business priorities" (web). The important message here is that unless a business understands its own overall operating environment, which includes organizational structure, culture, management philosophy, operating style, and commitment to excellence, choosing the right software will be impossible. Strategic planning is a critical element to determining the vision of an organization and, ultimately, the tools necessary to attain it.
Strategic planning is used to identify long-term goals and objectives that guide a business in the development and use of its core competencies. It is these core competencies that help establish operational plans, one that involves the accounting, financial and reporting mechanisms used by businesses. This initial planning phase gives guidance and direction to the task of identifying an accounting software system that will help a business meet its goals. "Great Plains Earns Arthur Andersen Global Best Practices Award. " Such was the headline of a recent news release by Great Plains Software. In fact, it is the third award Great Plains has received in as many years from Arthur Anderson, a global professional services organization.
The awards were for Strategic Leadership, Exceeding Customer Expectations, and Motivating and Retaining Employees. According to the press release, "Great Plains received the Strategic Leadership award in part because of the following Leadership development competencies: &# 61608; Strategic Vision and Innovation " Awards like these are an important part of identifying good businesses with good products and good vendor /customer relationships. The awards presented by Arthur Andersen are significant because independent judges made up of respected leaders from business, civic, and academic sectors are used to judge the applications. While making software choices on reputation along won't assure a successful choice, a business' reputation is something of which to pay attention. Recognition by one's peers and system users builds confidence in knowing that the product and business practices of the vendor are well respected. Good front-end preparation is the key to successful implementation.
Following the initial strategic planning effort, a business is well prepared to outline the steps it will take to ensure the appropriate software is selected. That selection process will include the following: A two-tiered approach, given the dynamics of decision-making, will often be required. The intent is to establish a process for identifying the needs of the organization by calling on knowledgeable employees and external experts. Oftentimes, the day-to-day user of the system does not ultimately make decisions about software purchases. Therefore, it is important to have an executive team participating at the beginning.
The software users, however, also play a critical role in the needs assessment. A technical team of employees is established to help identify the requirements of the software system while the executive team establishes certain parameters, discussed more fully below, that will be used by the technical team. From time-to-time these two teams should meet and confer about any issues that are of concern to one team or the other. Buy-in by management and staff is one important goal of selecting the right team members.
Without buy-in at all levels, the chance of being successful is greatly diminished. &# 61608; Requirement/Constraint identification As noted above, both teams participate in this step. The executive team will establish cost parameters while the technical team will identify the limitations of the current system and potential new hardware needs. Frequently, a consultant will be called in to help with the identification of future needs because of the lack of expertise in-house regarding potentially new technology. While staff can focus on what might be desired and what is deficient about the current operation, what is available to correct the deficiencies may not be known. Using a consultant is the most cost-effective method of identifying alternatives.
The purpose of the consultant is to gather market and product information based on the needs and desires outlined in the previous step. A consultant must be identified who is not tied to any specific product but will serve strictly as a research consultant. If a business is too small or believes it would be too costly for it to hire a consultant at this point, there are many good sources available to compare software products. Because there are over 300 various accounting software packages available, a business must decide which packages best fit its requirements. The executive and technical teams need to consider and choose a "short-list" those vendors. A significant step at this point is to create some real scenarios to be played out through the demonstration of the products you choose to review.
These scenarios use data information specific to the business and come directly from its database. Choosing the reply deadline is the remaining issue to be resolved before sending a request for proposals based on the criteria established in prior steps. The return date is important especially if a timeline for implementation has been identified to coincide with certain reporting periods for the business. Expectations for responses must be clearly articulated to the vendors so that there is no misunderstanding at the time the teams begin reviewing the proposals. Once the teams have received the RFPs, it is important to have already established the review criteria and rating system so that ev...
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Research essay sample on Core Competencies Strategic Planning
