Putting the Customer First - Really!

You, the software vendor, are making your pitch.  It breaks down into three sections:

1. Microsoft has amazing software,
2. You are an amazing Microsoft representative, and
3. Here's how you would address my needs.

It's very logical, isn't it?  The problem is that every vendor I see has the same pitch.  It's like Microsoft has pre-packaged the sales presentation (actually, Microsoft does do that, but that's a story for another day).  Another problem is that my eyes have glazed over by the time you get to the good stuff.

Really.  I'm stifling yawns by the end of the first section.  You see, I can predict what you're going to present, so I lose interest.  There's no way you're going to say that Microsoft is anything other than perfect or that anybody might have a better team than yours.

What if we turned the whole presentation around?  What if the presentation started with my problems?  What if instead of filling the screen with the logos of the other companies that use the software, it was filled with diagrams showing what I need?  You'd have my attention.

Really.  I'd be on the edge of my seat.

Then, once you've got my attention by showing me that you understand me, what if the salesperson stands back and lets the team speak?  That would show me that you have confidence in the people who are going to do the work.  YES, let the techie speak!  Coach him/her before hand.  Tell them it's OK to be nervous, but let them say something like, "I spoke to your technical staff about your current hardware.  We think you can continue to use your existing workstations and network.  All that will be required is a separate server for the Microsoft system."  Then, your implementation manager could give me a run down of a sample implementation for a company my size.  I would get a chance to assess the chemistry between my staff and yours.

After that, I'd be all questions.  Have you done this kind of implementation before?  Who are your other clients?  Can the Microsoft system handle my requirements?  You could then do the rest of your presentation, and get through all of your material without a single yawn from me.

Really!

Why Aren't You Using My Software?

The picture on the screen was your average warehouse, but it wasn't your typical Microsoft corporate shot, i.e. it wasn't a perfect company with gleaming boxes on pristine shelves, where you'd swear you could eat off the floor. This one looked real. It was even a little -- dare I say it? -- messy. The Navision (Microsoft Dynamics NAV) developer from Copenhagen explained that this was a company they had used for research. The company had about $10 million dollars worth of inventory and already used Navision, but they weren't using the inventory features. That was why the developers were there. They wanted to see for themselves. They wanted to talk to real people in a real company and find out how they could make the software easier to use.

Sometimes it isn't enough to ask people what they want. They can tell you what they don't like, but they often have trouble telling you how to fix it. Then you have to be sure that the fix for one person doesn't cause problems for someone else. In this case, the reason the company wasn't using Inventory was that they found it too complicated and cumbersome. There were too many features they would never use. Theirs was just a simple business.

That's how the role tailored client was born in NAV2009. Every person has their own role to play. Each person needs access to different features. Jumping around between menus just wastes time and makes the system look complicated. The lay out of the options should tell their order. People should be able to tell at a glance how many transactions they have waiting for them so they can decide what to do next. If something isn't being used, it should be taken off the window. Even if you are filling in for someone else, it should be clear what needs to be done.

Sometimes important steps are taken without any technological wizardry. Sometimes all it takes is a watchful eye and a curious mind.

How to Connect at a Convention

At 7,000 attendees, Microsoft Convergence was the biggest convention I have ever gone to. With that many people, connecting to the ones who are important to you becomes a challenge. The people going to Convergence are from different parts of the country, different industries and use different versions of Microsoft Dynamics. Just finding someone to have lunch with is a planning exercise. This picture is what I saw coming in for breakfast on the first day. Note that the tables are numbered. That helps you call someone on their cell phone to say where you are.

Microsoft works hard to help people connect. From the moment you register, you can set up a personal profile in the Convergence Connect web site. The web site also allows you to set up meetings at the conference in an area set aside for that purpose. For example, someone invited all CFO's using Dynamics NAV to a meeting. Even though we were in industries ranging from a zinc parts manufacturer to a church, we found we had a lot in common and decided to meet again after the conference.

Microsoft also plans for chance encounters. Here is a picture of my conference badge. You can tell which software I use (Microsoft Dynamics NAV), which industry I'm in (Non-Profit) and which user group I belong to (NAVUG) because there were bins where I could pick up the buttons. On the last day of the conference, someone with another faith based organization saw my Non-Profit button and said she had been looking all over for someone to talk to about the software choice they were about to make. We talked for about half an hour about NAV and also agreed to contact each other after the convention.

Other features: on the back of the badge is a pouch with a miniature schedule, which helps you know where to be when. People also used it to store their business cards. It wouldn't be Microsoft if it weren't computerized. The plastic name badge contained a chip with my information in it. All a trade show vendor or the people at the doors of the sessions had to do was point a reader at the card to record my information. I didn't even have to remove the card from the pouch.

Getting conference feedback is difficult. Microsoft computerized the session evaluations, made them short, offered a $5,000 travel voucher as a prize and said they would donate money to a the local Boys and Girls club for every evaluation completed. Still the number of evals completed was a fraction of the total number of sessions attended.

Finally, with that many people, it can be hard to make them all feel welcome. At Convergence, they had information booths as well as a small army of people in red shirts available to answer questions or tell you how to find the room you're searching for.

Is Your A/P Clerk a Knowledge Worker?

Knowledge workers. The hype is everywhere, from Microsoft commercials to Gartner reports. This is the age of the knowledge worker. Just what does that mean? How has the job of the typical Accounts Payable clerk been transformed?

Let's take a little trip back in time to a retail operation I audited early in my career. Their accounts payable department took up one half of a floor in a small office building. The women (yes, they were all women and one of them actually tried to match me up with that nice young single credit manager) had large manual calculators called comptometers on their desks. Every day they would take the invoices received from the retail outlets for products received and check the calculations and the tax. They would then create batches of fifty invoices, attach an adding machine tape and send the stack off to the data entry department to be entered into the computer by another group.

Fast forward twenty years to that same department. There are far fewer accounts payable clerks and the data entry department is long gone. The clerks enter the invoices directly into the computer which does all the calculations so they can just check that the total on the invoice is correct. The system also compares the pricing back to the company's purchase order, another step that used to be handled manually. Have we reached the knowledge worker stage yet? Not quite.

Fast forward to now. There is about the same number of people in accounts payable, but they are handling a lot more transactions because the company has grown. There is no data entry because supplier invoices come into the system automatically via electronic data interchange (EDI). When accounts payable staff sit down at their workstations they see an icon to tell them how many documents are waiting for approval. As they open each document, information about the supplier pops up in a fact window. They can see statistics about the volume of transactions as well as being able to examine past transactions. If they see a large number of returns or problems with documentation, they are in a position to recommend that the supplier relationship be reviewed.

When I asked a Microsoft employee about their view of the typical accounting system user, his response was immediate, "Everyone sees the KPI's" (key performance indicators - i.e. the statistical analysis which measures progress). In this world everyone is a decision maker. Everyone is responsible for their goals. It isn't enough to just show up and put in your eight hours. Everyone is a manager of something.

Is that how you view your accounting staff? The more I think about it, the more I think that is the way to go. Things happen too quickly for all the decision making to climb up the chain of command. Besides, who has the time anyway? You just have to make sure that the internal processes and systems stay in synch. It's pointless to make all kinds of information available to someone who is not in a position to make any decisions. It just clutters the screen. Conversely, it's pointless to make people responsible for outcomes without giving them the information they need.

Does your company employ accounting clerks or knowledge workers? Please leave me a comment.

Can You Teach Innovation?

Can someone learn how to be innovative? Tom Kelley, the General Manager of IDEO, definitely thinks so. He freely admits that he was skeptical when his firm departed from its history of hiring only engineers and started looking for "soft" skills, like anthropology. Yesterday I attended his session, "Ten Faces of Innovation" as part of the Microsoft Convergence accounting customer conference. I too was skeptical. Too often, sessions like this are full of management metaphor, animal allegory and fluff. This one made me think.

Tom used the examples of Sony and Samsung to demonstrate what it looks like when a hungry competitor starts taking a little slice of your pie. But he quickly moved on to his main point: there is no substitute to directly obsesrving how your customers use your product. Focus groups and surveys, he says, are fine for small innovations, but the big innovations require more work.

Applying the Lesson

What I love about a conference is that you can hear a key note speech on a general topic like innovation and then move to a detailed presentation where you can apply what you just learned. This morning I attended a session on getting the most from your distribution software. Part way through the software demonstration, Philippe Jacobsen, a Program Manager with Microsoft in Copenhagen showed some pictures of an actual warehouse. The pictures were not the type of sanitized, you-could-eat-off-the-floor kind of warehouse you usually see in Microsoft promotional material. In fact the place looked a little cluttered (i.e. like a real warehouse). Philippe paused to say that he had visited this company as part of his research. The company had used the Dynamics NAV system for years, but had never implemented the Distribution features, despite having inventory valued at over $10 million. His question was why. The answer was simple: the distribution features were too complex. They just wanted a simple system.

Keeping It Simple

Designing simplicity into a system is tough. It requires a lot of observation and analysis about how people use your product. Tom used the example of a defibrillator IDEO designed. Here's the picture. In an emergency situation, do you think it would be easy to use?

Microsoft's approach to making replenishment easy to use is to have the documents and screens follow the "simple" route. If you want to use the advanced features, you can drill down at key points in the process and open a window.

The challenge is and always will be to design general purpose software that fits diverse situations. Warehousing and distribution are areas where there is a wide variety of best (and not so good, but firmly entrenched) practices.

What has been your experience?

Networking for Geeks

How do you network if you're in a crowd of strangers and you're not particularly good at it anyway? I'm sure that's a question that the organizers of the Microsoft Convergence conference for their accounting system customers thought long and hard about.

I have to hand it to them for being innovative. Not only did they hold the conference in New Orleans, which is still recovering from the effects of hurricane Katrina, but they also asked attendees to volunteer on a Habitat for Humanity project creating houses for people who couldn't otherwise afford one. What better way to get to know someone than to be swinging a hammer right next to them?

The volunteers wheeled sand into place to improve the drainage, as well as framing a new house in a project dedicated to New Orleans musicians.


Microsoft also throws an awesome party. There were Mardi Gras revelers throwing beads, clowns on stilts, dueling pianos, a rock band and all the cajun food you could possibly want. For the more serious minded, a tour of the aquarium was included. Watching the divers feed broccoli to the sting rays was fascinating as well as being a very good use of broccoli!

A software tool developed for the event allows all attendees to create their own profile and arrange meetings with other attendees. Using it, I discovered that one of our customers also uses Dynamics NAV and is interested in talking to other users of the inventory system. I don't think I would have found out that information any other way.

Reaching out to other Dynamics users has been rewarding for me. Comparing notes with someone who has faced the same issues can save a lot of time, not to mention consulting dollars. Microsoft actively supports the user groups AXUG, GPUG, CRMUG and NAVUG.

Why I'm Excited About Convergence

Convergence is Microsoft's annual invitation to all of its business customers to meet and talk about accounting software. Yep, that's right. It's a giant convention of computer geeks and accounting nerds. Being a bit of both, I feel right in my element, but that's not why I'm excited.

There is a whole raft of technical sessions. A bunch of them are about Dynamics NAV (the product I use now) and Dynamics GP (the other product I implemented). There are speakers about applying the product to specific industries, integrating it with Microsoft Office and more general topics such as Kevin Schofield talking about where Microsoft is headed, but that's not why I'm excited.

Convergence is set up to encourage us end users to find each other. You can set up a profile that other users can search so that you can link up with others in the same industry and/or geographic area using the same software. Several user groups will also have their meetings there and I'm helping with the Ontario users, but that's not why I'm excited about going.

Sure, all these things are important, but for me, the key is the direct connection between those who make the software and those who use it. Our system was built (well, acquired actually, but you know what I mean) by Microsoft. Then it was modified for charities by Serenic. Then it was implemented by Altus. Then we started using it. That's four layers. It's time that layer 4 talked to layer 1! I love to meet the people who are truly passionate about what they do. They can tell you where they are headed and what they were thinking when they wrote the system you have. They can often give you fresh insight into how to use the system more efficiently/effectively. Often level 1 feedback gives you reason to go back to levels 2 and 3.

Then there are the vendors, all those hardy souls who have built software to make your life easier. Many people will scan the convention material for the specific software they're looking for and limit themselves to those vendors. Not me. I can do that kind of search more quickly with Google. I'm looking for ideas. Since there's no telling where a new idea is going to come from, I talk to as many vendors as I can. Who knows? I just might see the perfect solution for a friend's system, if not my own.

If you want to follow my progress through Convergence, I will be tweeting it for AccountingWeb.

What Would You Do?

Here's the situation: you're a large software company and you own several competing software packages. You want to keep your customers. In fact you want to build a relationship with them so they keep updating their software instead of holding on to one version until it's obsolete and then going with the newest product from a competitor.

Here are some of the problems.

1. The products have been built on different platforms. None of them uses your latest technology.
2. Accounting systems are incredibly complex, responding as they do to different business practices and regulatory environments. (To understand the complexity, just imagine building a system that handles both US sales tax and Canadian goods and services tax.)
3. Your first thought was to merge the packages, but your developers told you to forget it. It would take centuries of programming to capture all of the features of the packages.
4. Oh, by the way, each package has a loyal customer base that would view being forced to "upgrade" to a different package with deep suspicion.

What would you do?

Me, I would look for any common weaknesses in the packages. For example, if my customers were routinely turning to third party software, such as Crystal Reports, I would look to see what that problem was. Maybe I could replace the reporting in all of the packages with something new, e.g. SQL Reporting Services and save a lot of resources.

If I had a proven user interface that my customers were used to, such as Outlook, then I would move all of the packages to that same look and feel. This would start the process of bringing the different user groups together.

Without having any inside knowledge, this is what I think Microsoft is doing. I was just treated to a demonstration of Dynamics NAV 2009 (formerly Navision). Speaking as a jaded, skeptical accounting system user, I am happy with the directions I see. As outlined above, I like the overall approach. As is typical with Microsoft, there are teasers in the software, e.g. role based security that attempts to simplify setup by grouping tasks that are typically found in the same job description. I see the beginnings of a workflow system here. (Workflow means that the system passes transactions between users as each finishes their task, for example, when you complete a journal entry, it is automatically passed to your supervisor for approval and posting.)

I like the way that Microsoft is working with user displayable fields. The reality is that fields that are critical to my business may be unimportant to you. The best way to deal with this is to make all of the fields available, and allow the users to decide which ones they want to see. This has always been a strength of Navision. I like how the new version enhances the presentation by allowing the user to pick a few key fields that are shown in what used to be the tab. For example, you no longer have to go to the Foreign tab to see the currency field if that's the only one you need. The best part of this approach, for me, is that it makes maximum use of the screen. It will be easier to make the data entry windows work with older monitors.

Have you see NAV2009? What did you think?

New From Microsoft (NOT Software!)

There's something new from Microsoft, and it's not software. It's a methodology called Sure Step.

Why am I excited about a methodology? Because Microsoft has recognized that the reasons that projects fail or customers are unhappy with their system rarely have to do with the software. Just Google "why projects fail" (e.g. here, here and here). You typically don't see "the software was missing important features" as the reason. Project management issues usually top the list: lack of planning, scope creep, poor communications, lack of a proven methodology etc. etc.

In the world of medium sized accounting packages that I work in, project management is often viewed by customers as an unnecessary frill. When creating project budgets, I stopped putting in time for project management because it was routinely removed in the price negotiations with the customer. Instead, I built in time to create a project plan as well as for status meetings and progress reports.

The consultants and the software companies only have themselves to blame. During the sales process we minimize the difficulty of implementing new software. We talk about how easy it is, how everything is menu driven and can be accessed with the proverbial one click of the mouse. We minimize the work that needs to be done by the customer: designing their chart of accounts, downloading history from their existing accounting system or putting thought into how they want the reports to look.

Unless customers see themselves as at least a 50% partner in the success of the project, I guarantee you they will not get full use of the system they invested in. I'm not talking about a dramatic failure here. The result will just be that staff will not abandon their tried and true spreadsheets or side systems and embrace the new technology. Microsoft measures everything (just ask any Microsoft employee what getting a yellow or red light means). They measured software success and came up with the mind blowing statistic that 46% of software licenses go unused. This means that only half of the people you thought would use the new system will actually do so.

So, what should customers do? If you do nothing else, insist on a weekly progress meeting throughout the project, so you can be sure that the whole project gets completed, not just the minimum necessary to go live. The meetings should be short and only the senior people on the project need attend. This meeting is not for solving problems, it just brings them to light. The agenda is:

• What was accomplished last week
• What is planned for next week
• Where we are in the project plan (you DO have a project plan, right?)
• New or changed risks faced by the team

Weekly meetings force people to actually DO something or face the embarrassment of having nothing to report. They let you know who is waiting for whom. They inform everyone of the issues faced by others. They allow you to be proactive instead of just reacting to issues.

Also, during the sales process talk to your consultant about how they implement projects. If it's Microsoft software and the words "Sure Step" do not come up in the presentation, ask why. Ask them about what you need to do to ensure the project's success. Ask them how much of your staff's time you should budget for the project. If the answer seems too good to be true, then it probably is.

Less Numbers, More Story

Harry is one of our unit managers. His normally calm, diplomatic voice takes on a sudden energy as he leans across the table and says, "People seem to think that any mission will do. That's just not true."

Harry has a point. Missions have to resonate with the team or they will not motivate them. I have worked for a passionate leader and I really felt the difference. When he announced his vision for the company, he made sure we all knew where we could make a difference. We worked together and supported each other. There was a well defined goal that was just beyond our reach.

Those are all good things, but, as I look back on that experience now, I see it differently. It was not the goal that motivated us, but the story of The Little Company That Could. We saw ourselves as a small Canadian company competing for recognition with our much larger colleagues south of the border. It was the classic David and Goliath story, and we were determined to create a happy ending.

My current company's story is very much in my mind as I put together the book that will become the blueprint for our company's 2009 year. People don't traditionally look to budgets for inspiration, but I am out to change all that. Here's what I'm planning:

• Less Numbers, More Story - The budget will now include a narrative telling the reader what we are aiming to achieve. The detailed tables broken down by Cost Centre, Account and month that I need to import the budget into the accounting system will be sent to the Appendix. People don't read them anyway.
  
• Align with the Organization's Priorities - The accounting system breaks the organization down into units, but the Board sees the operations in terms of their priorities. The budget book will take all of the individual managers' goals and show how they fit into the Board's priorities.
• Support the Priorities with Graphics - I will use my Microsoft reporting tools to present the plans graphically, just like I promised. The reader will see that we are putting our money where our mouth is.
• Get More People Involved - Some people view budgeting as a black box: a mysterious process with results that are beyond their control. The budget book will have a section describing the process and talking about how budget adjustments were made. We will ask for more input from the people most affected by the budget and actively seek their buy-in.
  
• Use the Technology - Use the Financial Reporting Software rather than Excel for the Budget reports so that changes to the Budget ripple through all the reports, instead of relying on more fragile spreadsheet links. Use Navision (Microsoft Dynamics NAV) to track the original budget separately from subsequent transfers and updates, so that I can show both on financial reports.

There was an excellent demonstration of the power of a story in Drew McLellan's Marketing Minute today. It certainly inspired me.

The public may not be on the edge of their seats when this book is released, but I'm hoping that Harry will be.

We're All In This Together

The first accounting system I had to supervise was an IBM product called MAPICS. I was an inexperienced newbie and knew nothing, so I joined a user group. Every couple of months we would meet at someone's office and someone would bring donuts. We would talk about our experiences with the product and try to answer people's questions. I got some excellent advice about how to handle program patches from IBM as well as where to go for programming assistance. Joining the user group was the best $25 I ever spent.

If there is one piece of advice that I can offer to everyone, regardless of the size of your company, your industry or the type of software you use, it's to join a user group. There is no better source of unbiased, practical information than other users of the same software. If there is a feature you would like to see added, getting a group of users together to request the change is the best way to get a developer's attention. If you are looking for trained staff, another user may be able to point you in the right direction. If you want to change your consultant, what better way than to ask for references from other users?

Many user groups are organized by software implementation consulting firms. I have heard these groups dismissed as being no more than upselling by the consultant. Of course consulting firms are interested in selling more software and services, but the ones I know go to great lengths to put useful content into the sessions. They know that providing practical, useful information is the only way they will get users to come back the next time.

Traditionally, however, user groups are started, organized and run by users. Vendors are often invited to make presentations, but user meetings are not about sales. When my Microsoft rep suggested I start a Dynamics NAV (Navision) user group in my area, my first thought was about all the administration of running the group. Then he told me about Dynamic Communities. They take all of the work out of running a user group, so you can concentrate on the meeting content.

All Dynamic Communities does is manage user groups, whether for Dynamics AX (Axapta), GP (Great Plains), NAV (Navision) or CRM. They just need one local person to lead and they will set up a local chapter. They will even give you a list of their members in your area. If you work through your local Microsoft rep, you can get help finding other users. Microsoft will also provide speakers if you give them enough notice. There is a sliding membership fee depending on the size of your business.

The typical local chapter has 10 - 15 members at any given meeting, with larger chapters averaging 30 - 35 members. The typical meeting goes from 10:00 am to 2:00 pm, with a networking lunch. The morning session is usually a formal presentation, with break out sessions after lunch. I asked about the split between technical and accounting members and Bonnie, the Member Services Manager, noted that chapters started by IT Managers tended to have more technical members, where chapters started by accountants had more user members. You need both.

One of the problems with user groups is their small size. A huge advantage of a centralized organization is that it's possible to put on a conference. Dynamics Communities is hosting a 2 day conference (The link is to the NAV conference. The others have similar pages.) in Las Vegas for $499 per person, with optional additional training either before or after the main conference. When you add that to the user forums available at mibuso and Dynamics' webinars, we've come a long way from a box of donuts after work!

The Most Advanced Accounting Software on the Planet

"Tally 9.0 has been dubbed the most advanced accounting software on the planet." That claim is obviously more marketing spin than carefully researched fact, but it points to a trap that we so frequently fall into: comparing accounting software as though there were some perfect system against which all others must be measured.

Anyone who knows me will tell you that I'm a Microsoft fan. In my quarter century of accounting, I have spent a decade implementing Dynamics GP (Great Plains) and Dynamics NAV (Navision). But I still wouldn't claim that it's the most advanced accounting software on the planet. The issue is not how advanced it is, but how well it fits the client's needs and budget.

"Unlike other accounting software, Tally accounting software makes sure all data is protected and backed up automatically" (further on in the same article). If someone starts comparing two accounting packages, stop them right there. There is no standardized language in accounting software upon which to base a fair comparison. Two packages may claim to have advanced inventory features, multi-currency, role based security etc. etc., but when you investigate, you find that they have addressed these features in very different ways. Furthermore, there are hidden assumptions included in the words. I would challenge anyone who claimed that their system automatically backs up data. How can their system ensure that backup media are being properly rotated and taken off site? These are both critical aspects to the back up process. The word "automatic" sends up red flags for me, as do the words "easy", "user friendly" and "at the click of a button".

Frankly, we accounting software implementers have done ourselves a lot of harm by raising people's expectations to unrealistic levels about how easy it is to change accounting systems. Yes, the software installs quickly. Yes, everything is menu driven. Yes, the manuals are online and there's an extensive help system. All of those features do not change the fact that accounting is done very differently in different companies, even those in the same industry. The bulk of the time spent in an accounting implementation is in marrying the new system to the company's procedures and requirements, as well as migrating the historical data to the new system, not installing the software. One thing I admire about Microsoft is the way they insist that all customers work with a local firm ("Partner"), so that there is someone familiar with the customer's business environment on the ground to deal with specific issues.

Microsoft actually goes one step further. They design their systems in layers, the top layer being the changes needed to make the software fit the individual client. They don't claim to be the most advanced software on the planet. They claim to provide a set of flexible tools so that you and your Partner can make the system fit your needs.

Signs You Need a New Accounting System

The top 10 signs you need a new accounting system are:

10. The service technician keeps threatening to retire
9. “Reconciliation” is your middle name
8. You ask for “proficiency in DOS” when hiring staff
7. When calling Support you hear laughter in the background
6. Salesmen no longer call you about upgrades
5. You have to go for coffee whenever you click on “Post”
4. Your system came on diskettes
3. The last person to know the setup password retired to Florida
2. Nobody understands the reports

and the top sign you need a new accounting system is . . .

1. Your subledgers need counseling for “irreconcilable differences”

Quickbooks is one of the most popular starting systems in North America. In fact, a March 23, 2008 PC Magazine article shows Quickbooks having over 4,000,000 users.

As a Quickbooks user, you won't have any of the signs mentioned above, but you still might have outgrown your system (which is a wonderful thing, when you think about it). Here's what to look for:

1. Performance - The number one reason why Quickbooks users switch is that Quickbooks slows down. Data entry windows, menus and reports take too long to run.

2. Features - As you add such things as warehouse locations or complex customer specific pricing you reach the limits of an entry level system. A sure sign you need to upgrade is the number of spreadsheets you need to maintain because the information is not available directly from the accounting system.

As one of 4,000,000 users you have a lot of clout. Look for a system that not only has the features you need, but also has a way to upload all the Quickbooks history you have worked so hard to build up. That way you can continue to spot trends in your reports. You don't have to start over or compare reports from different systems. One example is Microsoft Dynamics.

Now, let's talk about those irreconcilable differences, shall we?

Accounting Software Consultants - Get Agile!

Agile Software Development has been around since the mid 90's and is gaining acceptance. If you implement mid-range packaged accounting software, like Microsoft Dynamics, you really need to look at this methodology. It is characterized by:

• Customer satisfaction by rapid, continuous delivery of useful software
• Working software is delivered frequently (weeks rather than months)
• Working software is the principal measure of progress
• Even late changes in requirements are welcomed
• Close, daily cooperation between business people and developers
• Face-to-face conversation is the best form of communication
• Projects are built around motivated individuals, who should be trusted
• Continuous attention to technical excellence and good design
• Simplicity
• Self-organizing teams
• Regular adaptation to changing circumstances

The reality is that however detailed they may be, specifications documents never deal with all of the actual requirements. For example, it is a very rare spec that includes how to handle data entry errors, yet these are an important part of every system. What you really need is a process that puts the customer, the implementer and the developer at the same table, each constantly helping the others understand the requirements on the one hand and the system capabilities / limitations on the other.

I would argue that this approach should extend to training as well. Classroom training set up in a generic, simple company with prepackaged exercises that always work has a limited usefulness in my experience. It is more useful for clients to deal with their own system and learn to solve their own problems. For example, one of my clients does an international consolidation of numerous subsidiaries. Instead of designing a training course around the consolidation, I chose one subsidiary and converted it in a test environment. Then I sat with the two analysts and we did one together. As we finished each step, one of the analysts took a screen capture and annotated it in Word for our documentation. Finally, the analysts each did their own companies, with me available for questions. As we hit setup, data and security issues, we solved them together. The analysts came away with a better understanding of the configuration of their system than they would have had it been a pre-packaged demo that ran perfectly.

What do you think?

When Accounting Software Firms Merge

The Wall Street Journal had an interesting article about how expected synergies are not always achieved when accounting software firms merge. The authors use Oracle and Peoplesoft as an example of a situation where promised benefits have yet to emerge.

I'm surprised the authors ignored Microsoft. Maybe it's because Microsoft is actually slowly gaining the synergies of its accounting software portfolio. In successive versions of Microsoft Dynamics NAV (Navision) and GP (Great Plains), the two packages I know well, Microsoft has moved the user interface closer and closer. Behind the scenes, they are acutely aware of the strengths and weaknesses of their packages and work with the partner channel to achieve the best fit between software and client. This isn't official, but my own view is that when Microsoft eventually releases one new package to replace all the former ones, it will LOOK like the user interface that people will have come to expect from Microsoft. But the programming will be 100% new. Personally, I don't believe that you can actually merge the programming code of two different packages. You have to build a new product from the ground up that takes advantage of the logic and features of its predecessors and the experience of the development teams.

Microsoft is rarely the first to market with software, but when they arrive, look out!

Specialized vs. Multipurpose Software

"Overseeing and managing costs on the construction of a new facility with eight buildings is much too complex for traditional accounting software," said Jerry Fye, deputy director of finance for the Austin Children's Shelter, in a release.

Foundation Software, a developer of customized software for construction contractors, donated software, training and support to allow the Shelter to manage its construction project.

This raises the question of when to go with "traditional" or multipurpose software and when to go with a system designed for a specific purpose or industry.

If I were developing software for a specific industry and I wanted it to link into an accounting system, I would NOT try to reinvent the wheel. I would build the links to one or more packages that are popular with the companies in my target market. Rather than build yet another general ledger for medium sized businesses for example, I would bridge to Great Plains or Navision (Microsoft Dynamics GP or NAV). That way I get to stick with what I know (e.g. construction projects) and take advantage of someone else's success.

This goes for custom development as well. One of my clients was in the entertainment industry and wanted to sell tickets to customers online. Part of the project design was to integrate tightly to the accounting system so they would not have to re-key the transactions. They also decided that they did not want to have to do the programming to calculate all the taxes when the accounting system (Great Plains) already did such a good job of it. So they had their web site pass the information to the accounting system once the customer had placed the order. The accounting system then calculated taxes and shipping charges and passed the information back to the web site so the customer could enter the payment information. The result: a system where every piece does what it's good at and the headache of updating the tax tables is left to the experts: the accountants!

Competitive Edge: Your Accounting System

The Toronto Globe and Mail ran a story about Analytics, saying that a company's statistics can be a powerful tool in the right hands. Harvey Schachter, the Globe's "Monday Manager" quoted from Competing On Analytics, a Harvard Business School book by Davenport and Harris, which highlights the need to have the right data and the right management support in order to reap the rewards of good analysis.

How well I know that story. Every time I implement Microsoft Dynamics (Great Plains or Navision), I offer the client the ability to integrate operational data in the accounting system, but I am rarely taken up on the offer. One glowing exception was a felt manufacturer where the President had a one page report of key performance indicators that he used to run his business. It was quite a challenge to make the new system fit the summary cash, balance sheet, income statement and statistics (with a separate column for each subsidiary) onto one page, but it was worth it!

Try this: picture your company as a sports franchise competing in the major leagues. What statistics would help you manage the team? Think in terms of:

• Output: How much do you really earn per unit, after all discounts?
  
• Input: How much waste is there, and at what stage does it occur?
  
• Human Resources: How many hours go into your product or service? How high or low is your utilization?
• Equipment: How long do your machines sit idle?

Often managers feel they know the answers to this type of question already. As the Production Manager of a tool and die shop said to me, "You're not going to replace me with a computer!" when I implemented a job tracking program for the General Manager. But that same manager was really surprised at how busy his plant turned out to be. He had been considering whether to replace his older drill presses with computer aided equipment, but he ended up keeping both the old and the new equipment when he saw the report of his order backlog.

Even if you have an older accounting system, you would be amazed at the quality of report that can be obtained from standard microcomputer software such as Crystal Reports or even Excel, when they have detailed financial and operational data to work with.

What Do You Use?

Remember the old saying that the shoemaker's kids go barefoot? I was reminded of that recently when reviewing my own accounting system. When I first selected it, in 1994, I narrowed the choice down to Quickbooks and Mind Your Own Business (MYOB). I chose MYOB because it had both a Mac and a PC version and I was a bit of a MacHead back in those days.

MYOB could continue to record my revenues and pay my bills, but I started thinking about hiring my son to do some of the mailings, particularly when I'm on the road. I'm currently looking at Net Suite because it is:

1. Accessible via the web,
2. Bundled with a web site interface and CRM, and
3. Aimed at small business and the mid market.

I can use it for myself and offer it as an alternative to Microsoft Dynamics GP and NAV (formerly Great Plains and Navision). I'll let you know what happens.