Most organisations would like to think they’re pretty cutting edge when it comes to all areas of operations. From sales and marketing to production and HR, business leaders know that the right technology can help them reach their goals (and profit targets) faster.
But some divisions can get left behind, and often, that includes finance.
For example, research released earlier this year found only 20% of finance professionals were using cloud-based software. That’s eight in 10 not benefiting from the latest technology.
So why does finance get left behind in the software arms race, and what are the dangers of not keeping pace?
Why don’t companies keep pace with technological change?
Organisations can get comfortable with what’s already working and adopt an ‘if it’s not broken, don’t fix it’ attitude. And let’s face it, who wants to change from a system they know really well to a brand new one they’ve never used before?
Finance is so critical for everyday operations that many firms won’t want to risk any downtime or data loss either, and may also baulk at the potential costs associated with upgrading to a newer solution.
And often it comes down to a lack of internal resources, either to understand how the finance software market has evolved and what new solutions are available, or to implement a shift from one platform to another – a huge undertaking in itself.
Changing from one platform to another is a strategic decision, and with most finance teams heavily ingrained in the day-to-day financial minutiae of their companies, the breathing space to take a step back and look at ways to improve current procedures and tools isn’t always available.
But finding that time is important, and whether that direction comes from within finance itself or the C-suite, the benefits of keeping pace with technological advancements are vital to future success in all areas of the organisation.
Drawbacks of using legacy systems
Whilst there are some drawbacks involved in switching systems such as potential downtime and increased costs, there are far more issues associated with relying on a legacy system.
Productivity
Productivity is the first problem that should be more evident with slow start-up speeds, counter-intuitive interfaces and reports that take an age to run. Older systems also don’t make use of AI or machine learning (ML), meaning the software isn’t helping its users to do more in less time.
Accessibility
The hallmark of a legacy system is that it can only be accessed on the premises. This increases operating costs and in the age of flexible working, makes it harder for everyone who needs access to the latest financial data to get the information they need, when they need it.
Security
Some finance systems are so old that they aren’t even supported anymore. That means no more critical security updates, stability fixes or even a support line if you run into difficulties. There are compatibility issues with this too as older software may become incompatible with newer computers and operating systems.
Legality
The way in which sensitive financial data is stored and handled is heavily regulated across the world and your customers, suppliers, partners and staff all expect that their financial information will be stored in a secure way.
Legacy software that isn’t regularly updated will, at some stage, likely fall short of the security and data processing legislation of the future.
Competitiveness
You can’t win in any market without a razor-sharp focus on margins, and the very latest finance software utilities the best in AI and ML to help finance managers spot where cost savings can be made, identify future cash-flow hurdles and automatically report on emerging internal trends.
Legacy software will help keep you where you currently are, whilst the latest tech can help you get to where you want to go.
Is your finance system outdated?
Now we know the pitfalls of relying on a legacy finance solution, it’s worth asking the question of whether or not the system you’re currently using may fall into the ‘legacy’ category.
To work that out, there are a few questions you and your finance teams can consider of your current platform:
- Have there been recent updates? If not, there could be security or data processing issues.
- Can you contact the vendor for support if needed, or do emails go unanswered?
- Can relevant stakeholders access the system from wherever and whenever they are, or do they need to be in the office?
- Does the system integrate with the other tools you use each day, and is it scalable with your increasing demands?
- Does your finance system support your teams to do their jobs, either by alerting them to potential issues, new trends or removing the burden of repetitive administrative tasks?
- Has your system supported the organisation’s strategic aims, above and beyond running the financials?
- And lastly, does the system make errors? Are your teams occasionally checking that calculations are correct and reflect the latest laws, legislation, and taxes?
If you and your team answer negatively to even just a few of these questions, then it could be that you’re starting to fall behind in the finance software arms race.
Realise the benefits of modern finance systems with Phase 3
Finding a new system takes time and can seem daunting from the outset. Even if you’ve answered the questions above and decided that the platform you are using is long overdue an upgrade, the reality of starting the process of finding a new platform and getting it set-up without suffering any down time can seem too daunting to bother with. You’re already really busy, after all!
But that’s where Phase 3 comes in. We help organisations just like yours to realise all the benefits of the latest in finance technology, without the internal headaches of adopting it.
Our specialists work to understand your current and future needs, use our extensive knowledge of the finance software marketplace to identify the right solutions, and then help to set-up and integrate that solution into your everyday working practices.
If you’re not ready to get started just yet, then ask about our system review and health check service. Our teams can unearth how your current finance solution is working, where it sits in relation to existing software, and establish any procedural, security and legislative risks associated with it.
If you know it’s time to make that upgrade, then learn more about our system selection and adoption service right here.
We look forward to helping your organisation to reap the benefits of the very latest in finance technology.
