July 17, 2018
Building the Right Finance Tech Stack for Your Organization
Posted by Armanino Financial Advisory Team
When you are building a new finance tech stack for your company, you have a lot of financial software options to choose from. With a large investment of time and money and your organization’s ability to scale on the line, you can’t afford to make uninformed decisions.
To evaluate new point solutions, start with some basic considerations. First, how will you integrate the solution into your current environment? Do you have existing systems that the new software will depend on for data, or systems that will be dependent on data from it? Many best-of-breed solutions can be easily integrated and some even come in built-in capabilities for integrating with other popular systems.
Second, think about what happens after the go-live. This is not so much about IT maintenance―patches and updates are done for you in a cloud solution―as it is about user adoption. Do you have a strategy to leverage the technology and empower your employees to use it to move your business forward?
Third, consider the timing of when to install which systems. What are your other upcoming business projects and day-to-day needs, and how will they impact resource availability? Expending time and financial resources on solutions without having solid answers to these questions is a recipe for lousy ROI.
Sequencing your implementations
There’s going to be more than one system that could benefit how you do business, so the question becomes, where do you start? The default answer is the ERP, because most other systems revolve around it, but we’ve seen finance teams struggle with this implementation because they had to spend too much time on daily tasks and processes.
With one client who replaced their ERP, Armanino worked through the process to the point that the system was configured and ready to launch, but their people didn’t have time to get trained on it. Normal business processes had them working until 10 p.m. every evening, with no time to learn something new. The rollout got pushed a month, then two, then three. Their ultimate return on the investment was quite small because the team couldn’t properly utilize it.
One strategy that often helps organizations succeed when building their finance tech stack is to implement smaller systems first, to help free up resources. In that case, aim for the low-hanging fruit. We sometimes recommend starting with the financial close automation, which is often a completely manual and time-consuming process that requires the full attention of staff each month.
Financial close automation is relatively non-intrusive and can free your staff to focus on higher value activities. We recently worked with a two-person finance team who cut 200 hours a month off their close by automating the non-value add, repetitive tasks. Once you’ve tackled the financial close process, your team will have more time to focus on implementing other parts of your finance tech stack, and extra motivation to do so after seeing the benefits of having the right tools for their jobs.
Tactics for success
As you start evaluating systems, it is critical that you assign responsibility for technology oversight and ownership. An individual or committee should have visibility over technology for the entire company, so that you can know what solutions are going in where, and leverage them across the business to address pain points.
Many organizations have even done two different implementations of the same software in different parts of the business, or had purchased two different solutions to achieve the same goals in separate departments. By not coordinating these efforts, they made costly purchase decisions that wasted resources and created unnecessary complications in their technology stack.
It’s also important to involve your stakeholders. When we talk to finance teams during an assessment, we always get the best information from the accounts payable and accounts receivable clerks, the people in the trenches doing the work every day. They’re the ones with ideas about what needs to be improved, and they know how new software will affect day-to-day operations. Talking to them will help you determine your business requirements and allow you to make more informed choices when you are picking solutions.
Up-front involvement will also help you get your people on board with the new technology. Some older, more established businesses face challenges with a lot of resistance because employees equated automation with job loss. You want to make sure staff know that your aim is to empower them to be more valuable by doing away with low-value, manual processes. If they know their input is heard, that their pain points are going to be addressed, they’ll be a lot more excited about a new system.
Create a roadmap
Document all your business requirements and measure potential solutions against them to see which solutions will best address your needs. Then take the solutions you’ve chosen and map them together, so you know how data will be flowing between systems. Is there an integration? Will you need to do a manual import from one system to another?
Finally, put a timeline together that shows your goals for when each solution should be implemented, and what resources are going to be needed at different points along the way. Inevitably, business events will occur that will impact your implementation. But if you have a timeline, you’ll be able to see how those events will have an impact on your plans down the road.
This will create a roadmap for finance tech stack implementation that will help guide the process, giving you something to share with stakeholders and providing visibility into the implementation to partners and executives.
To learn more about building a finance tech stack for your organization, check out this white paper on Building Your Finance Technology Roadmap.
Armanino’s Financial Advisory blog is your source for thought leadership around cloud ERP and accounting solutions and integrations. Supported by the Cloud Accounting Institute and numerous experts in cloud, finance, reporting, integration, compliance, and technology, Armanino’s Financial Advisory blog features must-read content on what’s happening in the finance industry, case studies, white papers, and much more.