Accounting Software Selection -- Accounting Software Locator

How to Choose an Accounting System

Study Your Business to Identify Special Needs

What factors make your business different? Do you use special forms or need to track information peculiar to your specific business or niche? Do you have needs to do extensive reporting? Do you operate several warehouses or sell from more than one location? Does your company do business in more than one state? Does it do business in more than one country or use several forms of currency? If your company is a service oriented business, a system designed to fit in a distribution business will not work well. These factors are the type that may drive the decision regarding the selection of a system.

Even though these factors are important, you should also consider that a solution designed specifically for your industry may not be the best choice. Many of the so-called vertical or niche market solutions may look good at first glance, they may not have the core accounting necessary to support larger organizations, especially if you have elaborate reporting requirements. You may also need more than one system, possibly a client server system for headquarters with smaller but functionally compatible systems at sales offices. A system that runs in several operating environments will fill this bill best.

Make sure you consider your business situation. Is your company growing fast? Be careful not to be overly impressed by technology or by flashy or novelty systems which may not have a proven track record.

Analyze Your Functional Relationships

Be concerned about the back office functions such as accounts payable, accounts receivable, payroll, and the flexibility of the general ledger. Also make sure that the system has the tools to support the entire business function. These may not be associated with particular departments or functions, but cut across the entire installation. These include such tools as report writers, query or inquiry tools, navigation means, security, documentation and help, and other factors affecting how the system works, over and above what the system does. Consider the tools and methods used to make sure the system is open to improvement through connection with the world outside the accounting system.

Balance Functionality with Technology

Be careful not to be bowled over by the newest technologies. Much of what is being talked about with client server and object oriented technology is exciting, but some of it is not tried and proven. Your decision should consider the maturity of the technology, but the most important factor is the functionality of the system and its match with the needs of your business.

Make Sure Your Budget is Realistic

Keep in mind that your expenditure on the software is only a portion of the total cost. It may be only 20 to 25 percent of the cost, especially after you count training your staff, developing new policies and overcoming mindsets. The cost of moving the data and records from your old system to the new will eventually cost considerable time and effort, also.

The life cycle budget should also include provision for software maintenance. This may include training for new staff members, your own support infrastructure, as well as updates and new releases of your software. A good job in planning will ensure the best and smoothest implementation, and will result in the lowest overall migration cost.

Balance Your Specific Needs Against The Flexibility of General-Purpose Systems

Some general purpose systems are sufficiently configurable to meet the needs of companies and industries that have traditionally sought custom solutions. It is doubtful that any company can develop all the tools and power included in some of the better general systems. If you truly need to develop your own special order processing system, you may want to consider doing it as an add-in or substitute for a portion of a good general system.

One general purpose system is The SouthWare Excellence Series. With over 30 modules, and operating in over 500 environments, it has sufficient flexibility to be suitable for many businesses.

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