Software evaluation has become more challenging as the number of software applications balloons over the years. Some applications are industry specific. Others offer capabilities that could meet business needs though they might not function as eloquently.
High-level cookie cutter demos are packed with jargons, bells and whistles. It is difficult to filter noise without diving into details. In order to do a proper evaluation and make a sound choice, there are five tips.
Start with needs instead of popular choices
An accounting firm owner reached out to me after a failed attempt to find a suitable practice management software for his firm.
He started his search with two most popular applications. Both are comprehensive suites that offer many features. Both demos seemed to cover his general needs. Without a detailed list of requirements, he was mesmerized by the slick demos. He was uncomfortable to make a decision and was stuck.
It is a risky proposition to make a software selection without a clear understanding of your business needs. It is critical to invest time on identifying your pain points and do a high level cost estimate on their effects on the business. This upfront work helps to steer you away from popular software. It also enables you conduct a discerning review of the software options.
Inquire for clarity beyond generic terminology
A Google search for accounting practice management software returned 92 options. Common features include CRM (customer relationship management), client portal, time tracking, invoicing and more.
The above features are useful for managing a business. While it is tempting to put a check mark to the requirements list, it is presumptuous without getting clarity on whether they indeed meet the specified needs.
The aforementioned accounting firm does bookkeeping for businesses and often also prepare personal tax filings for the owners and family members. To ensure the new software would meet their need, it was important to inquire about the capabilities and limitations of the CRM features.
Some vendors might position a basic client database as CRM, but there are no capabilities to create linkages between accounts. It is important to ask questions about the different use scenarios you need so there is clarity on whether the specific requirements are met.
Understand the effects of quasi automation
A key benefit from software adoption is automation. You aim to eliminate manual tasks and expedite workflow, improving productivity and operational efficiency.
Workflow automation is a generic term. How automation actually works makes a difference in its effect on productivity.
When the software is able to follow the defined rules and moves the workflow to the next step, it is automation. However, quasi automation requires a person to verify a task completion and move it to the next step manually in the application.
This human intervention is really a manual task done in the software. It could become a bottleneck. A high level demo would not reveal the quasi automation. This is why it is so important to invest time to ask the right questions about the software.
Identify third-party integrations
For the accounting firm, having a client portal is critical to streamline how it communicates and shares documents with the clients.
One of the applications we looked at requires integration with an external portal provider. This complicates the synchronization of client information updates as well as the ability to log changes for auditing purposes.
Though third-party software integration is common, the additional effort required to work with multiple vendors on respective upgrades and to ensure both applications work coherently is an added consideration. The extent of vendor support and how well each would work through an issue without tossing it over to the other vendor is important.
Undercover hidden costs
Pricing structure varies. Some offer an all-in-one package price. Others use a modular approach, or pay-per-use for certain features. Depending on needs, the total annual cost could swing significantly.
For the accounting practice management software we looked at, one vendor charges each e-signature done within its portal. Another has a limit on file storage capacity. The subscription rate is bumped to the next plan when the limit is exceeded.
On implementation support, there are many options. Be cognizant of in-house technical savviness and what you need to do a good implementation. Building a solid operations model in the application does require a sound understanding of how the features work together. It is beneficial to have proper guidance so the model will function properly. Having to fix issues after rollout could be a painful process.
As part of the overall evaluation, cost does carry weight to the final choice.
Transitioning to a new software impacts the business in many ways. Employees and customers usually see the effects directly. Needless to say, the business benefits when the choice is a good fit. Otherwise, the negative ripple effects could be damaging.
Therefore, it is paramount to do the proper needs identification upfront. The prioritized list of requirements helps the vendor to understand your priorities as well. It also serves as a filter to disqualify unsuitable options. Most importantly, you need to dive in and ask questions so you have all the information you need to make a solid choice.
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