Discount accounting software

The hot pace of office technology has cooled a bit. You may not have noticed the slowdown because you're probably still breathless from trying to keep up--or at least catch up--with the hectic rate of updates in the past several years.

Although every new computer model runs faster than its immediate predecessor, we've reached a momentary technology plateau of sorts: Now, even 2-year-old hardware is powerful and stable enough for most office applications. And the majority of professional software packages--from tax preparation and accounting to time-and-billing and write-ups--have undergone enough upgrades and bug fixes that they now generally work flawlessly, providing a major boost in CPAs' productivity."

So, if you bought your computers and upgraded your software no more than two or three years ago, does that mean you can sit back, confident that your office technology is completely up-to-date and running at top effectiveness?

Hardly!

Now that you have this rare gift of a technology breather, you have the time to focus on two things so you don't fall behind when the advances pick up speed again--as they surely will. First, take the time to fine-tune your current system setup to be sure it's giving you the maximum efficiency for your current needs. Then look ahead to see where your business is going--or where you want it to go--and determine whether your current tools will take you there. And, if they won't, decide what you'll need to do to get on the right path.

This article will help you figure out how to accomplish those goals. It will cover technology planning, hardware, software, staff training and purchasing strategies.

STEP TO IT

Even before you look at your current technology setup, you must have a plan--a road map for where you want to take your business in the next few years. Recognize that if you fail to plan a future course, you'll eventually pay a high price in dollars spent and time and opportunities lost. As the wise adage says, "If you don't know where you're going, any road will take you there."

If you haven't done so already, create an in-house information technology (IT) committee that continually reviews business needs in light of new advances. Of course, it would be best if the committee included members knowledgeable about technology or at least had a strong interest in the subject. However, if your enterprise lacks such people, bring in a consultant who can tell the IT committee whether your current setup--computers, printers, scanners, network, Internet connections, telephone system--is adequate for the future task and, if not, what you'll need to do.

Even if you engage a consultant, there is much the IT committee can do on its own to fine-tune your operation and guarantee it does not fall behind technologically.

* Software: Maintain a list of alternative applications that can perform every one of your key business functions. At least once a year, review the two leading competing products and occasionally obtain evaluation copies to compare them with what you currently use.

If your IT committee sees something in one of those products it likes and it's missing from the software you're using, point that out to your current vendor--putting the vendor on notice that you are looking at the competition. As a result, you will be in a stronger position to negotiate better terms for renewals, future orders and service, and that may inspire the vendor--for fear of losing a good customer--to consider voluntarily adding new functions.

Or you may discover that your product already has a function you thought was missing but somehow overlooked; considering how complex some applications are, that's not so unusual.

Another advantage of keeping abreast of the competition: In the event you can't solve a problem with your current software application or the product is discontinued, you can quickly switch to one of the alternatives you've become familiar with.

One more reason to monitor other applications: Occasionally vendors augment their software with a whole new capability or they integrate it with third-party vendors' software. As a result a product that was not competitive in the past may suddenly become a serious candidate.

Aim to reduce the number of software vendors. Surely, the policy has drawbacks: You are more vulnerable if a vendor goes out of business. Also, on occasion, if you decide to limit your relationships to, say, two vendors, you may find that a third vendor has one product that is superior to the one you're using. But, as difficult as it may be, dealing with one or two vendors gives you more leverage on price and support and minimizes training costs.

Excel and Lotus 123 are a case in point. Excel is packaged with Microsoft Office, and Lotus 123 is in SmartSuite. Both are excellent products. However, the vast majority of business offices uses the Microsoft suite. A significant number of CPAs have long been devoted to Lotus, and even though they use the rest of the Microsoft suite, they stay with Lotus because they're so familiar with it. And that's despite the fact that Lotus doesn't interface as effectively with the other Microsoft products as Excel does.

Advisory: Maintain a list of all your software applications, both on- and off-site. Include all unlock or licensing codes or files, the number of licenses owned and their renewal dates. This seems like an obvious tip, but many organizations fail to maintain this information--and that can be an expensive omission. For example, if they miss a license renewal date, they may fail to get a regular discount.

In the event of software corruption, you likely will have to reinstall the programs, and for that you need the unlocking codes or files. In addition, when a disaster hits your facility and the software is lost or damaged, if the license documentation is missing, you may have to repurchase replacement software at full price.

Never make a decision about upgrading either software or hardware before you consider what business problem the move will solve. Too often managers get caught up in the chicken-or-egg riddle: Which should we upgrade first--the software or the hardware? The answer is neither. Consider this business-solution question first: What technology is needed to solve this business problem? If the answer is software, the next step is to determine whether the current hardware setup is sufficiently robust or compatible with it. Don't just assume the hardware is up to it; check with the software vendor.

For example, if your organization wants to upgrade to paperless technology--that is, document imaging--don't run right out and buy a scanner and the associated optical-character-recognition software. First, determine which of your business processes can benefit from using less paper. Next, decide whether you should buy a complete document imaging system or whether you can upgrade your current software to do the job. If you lack a staff expert who can make that determination, consider engaging a consultant--but, for obvious reasons, not someone who sells document imaging equipment.

* Operating systems: Contrary to what Microsoft would have you do, my consulting organization encourages clients to leave their operating system (OS) alone unless new software applications or new hardware requires them to upgrade. Changing a system for the sake of change is expensive and often difficult. That said, it's also important to understand that failing to change an OS which needs an upgrade can cost you even more.

So how do you recognize when you need an upgrade?

If your system locks up or applications run slowly, you most likely have an OS problem. Don't consider a system upgrade as the best first step for solving it; it's better to upgrade the hardware, which will come with the latest OS version already installed. In general, software upgrades cost more than hardware upgrades because replacing both the OS and the associated applications usually requires a major time investment, and time, as you know, is money. For more on this, see "The Microsoft Dilemma," page 31, and "The Linux Option--Almost Ready for Prime Time," below.

We believe that, when possible, the OS that was initially installed in your computers should be left alone. However, that often results in an office with multiple operating systems--Windows 98, 2000 and XP, for example. In general, running multiple OS versions costs more to support, and that's frequently unavoidable. But if the system works, it's worth living with. On the other hand, if the OS or your whole system functions poorly, replacing all the computers may be the most practical option.