The right financial system is vital to any business but if it ain't broke, don't fix it!
I want to recount our personal experience in the hope that it could benefit other companies and avoid a potentially very expensive (and emotional!) journey.
At Good we prepare monthly management accounts and work across various financial platforms. We had a finance system that was reasonably basic but it worked - everyone logging their time on an on-line system and we used excel spreadsheets for forecasting and our management accounts.
Several financial intuitions and our accountants were impressed with our systems, control and projections, however, we always wondered ‘could it/ should it be better?’ We yearned for a one touch report on a project that encompassed: a quote; client and supplier invoices; project specific hard costs; time logged during the project. One that could show us how we were progressing against the quote and at the end of the project it showed how we performed. Our existing systems could provide this information, but it certainly wasn’t a one-touch process.
(*Spoiler alert – be careful what you wish for!)
We knew there were industry specific software providers out there who had designed systems that could capture all we wanted in one system and a ‘one touch of a button’ project report. We made a short list of 3 providers. We viewed all 3 systems and agreed on which one looked best for Good. It provided the ‘one touch’ project management, it looked like it would give us the information we wanted and needed; it seemed easy to use and generally it was pleasing on the eye. So we decided to go for it.
They recommended to us that when changing systems we utilise all or as many as possible of the new capabilities. We did however continue with one of ours – we kept our forecast system. Call it a sixth sense or just good luck, but it transpired that our forecast system became our only real handle on our sales and became our lifeline to the real numbers.
So we cracked on, with all employees having the relevant and necessary software system training. Some disciplines used the system more than others, for example the client services team now did their quotes and all the roll out admin work on the system and the finance team managed the information provided by the client services team. Everyone else logged their time on the system but had little further exposure of it.
The new system was supposed to save a large amount of time for client services and finance; however, things didn’t go according to plan. It quickly became laborious; confusing; hugely frustrating and we lost our management reporting systems for up to 6 months. Even after all that time there were still a huge number of concerns and issues that were not going away and although some elements of the initial issues were down to human error, they were not the main and recurring issues. It was clear that the system was far too complicated and couldn't do what we needed it to do.
We gave it about 8 months but the writing was definitely on the wall. At our next Board meeting we discussed the new system at length, and decided that as we had already invested time and energy into implementing this new system, we would give it another 3 months and see if things improved. A sensible decision at the time but it came as no surprise that at the end of the further 3 months, we took the decision to walk away from the system, take the hit on the cost and reinstate our old systems.
Elation was pretty much the response from everyone and we haven’t looked back. It wasn’t until that point that we truly appreciated just how laborious and disruptive it had been and how it had impacted on every member of staff.
So what did we learn? Here are the main things;
· Don’t assume that what looks better is always best. If you are considering changing your financial systems, run them in tandem for at least 3 and if possible 6 months. It may feel laborious but it is essential.
· Be clear about what you want from your new system, by understanding what your current one is not doing for you. Look for a new solution that will fill those gaps and save time.
· Don’t be overly reassured by slick demonstrations – looks can be deceiving.
· Make sure they have an excellent customer support system – that solve the problems, not add to them.
· Read the small print rigorously for your notice period and any hefty ‘lock-in’ periods. This can be up to 36 months and there is no compromise.
· Don’t be afraid to walk away, regardless of the cost, your business will thank you for it.
There’s no doubt throughout this process we learnt a lot, and perhaps one day will reconsider our systems again. The ‘one touch’ project system could be out there, but we will not fall foul a second time. Meantime we’ll continue to enjoy the systems and controls we have in place which continue to serve us very well.
(No lives were lost during this 18-month year period but the wellbeing of those involved, some more than others, was certainly challenged!)