7 SIGNS YOUR BUSINESS SYSTEMS NEED AN UPGRADE
Let’s face it, the words ‘paperless’and cloud computing are not ‘new’ concepts anymore. However many of us like tradition and are more comfortable with paper, keeping our accounting not in the cloud but in deskbound software, spreadsheets or even manual cashbooks. Perhaps we have tried some early editions and found it cumbersome or slow.
Two key things about terms like ‘paperless’ and cloud’ are that:
- It’s not about the lack of paper or the servers being ‘in the cloud’ — they’re just features;
- It’s about efficiencies, data flows and knowledge sharing — they’re the benefits.
The terms ‘paperless’ and ‘cloud’ are both quite abstract, so let’s look at some concrete examples of things that are evidence that your business practices might still be stuck in the last century. Systems are getting better and faster all the time, now is the time maybe to look again to make your accounting system digital.
7 SIGNS OF INEFFICIENT BUSINESS SYSTEMS
1. Manual data entry: Data should flow into your business from sources such as:
- Your website
- Online forms (such as ‘contact us’, questionnaires, applications forms)
- Data feeds from banks and other suppliers
You and your team should not be doing manual data entry. You can design your marketing and sales processes so that your prospects and customers or clients happily do that data entry for you.
2. Re-keying of data: This is where you already have the data—such as the customer’s or client’s name and contact details—but the data is in some applications and not others. Your data should flow seamlessly between your different applications including your:
- Website platform
- Email marketing system
- Bookkeeping and accounting system
- CRM
- eCommerce system
- Point-of-sale system
- Inventory system
- Marketing automation platform
- Proposal system
- Workflow system
- Typing of data if there is an alternative is just inefficient.
3. On-site data backups: Cloud-based Software-as-a-Service (SaaS) providers will do more frequent, more reliable and more secure data backups than your business will ever do. Storing your data locally on your own servers and desktop computers is risky. Floods, storms, fires, theft. They happen.
4. Onboarding new staff is extremely time consuming: If you need to show new team members how to do everything through one-to-one training, and you find yourself re-explaining processes and procedures, chances are you don’t have an office manual. Even small firms can create a company wiki, and use videos and screencasts to train your staff. Wikis are easy to create—try Google Sites, it’s free—and videos and screencasts are easily recorded using apps such as Snagit and Screencast-O-Matic.
5. Manual invoicing: When people buy from you, the invoicing process should be 100% automated in terms of creating it, PDF’ing it, emailing it to the client and storing it in your digital filing system. Depending on your accounting system—for example Xero or Quckbooks Online—there are various ways to achieve this automation. Xero even offers easy integration with payment services so your customers can pay online using a pay now link from the invoice.
6. Manual chasing of debtors: Best practice for collecting payments is to let people know when their payment is due and when it is just overdue. These timely reminders can be automated via email, SMS and voicemail messages straight out of Xero. Add ons like Chaser and Satago make quite sophisticated automation possible for even the smallest of business.
7. Cash flow is managed based on bank balances: Simply looking at your bank statement every now and then is not cash flow management, yet this is how many small business operators assess their cash position. Cash flow needs to be managed on a predictive basis, taking into account known future inflows and known future outflows, such as payroll, rent, supplier payments and (often large and lumpy) tax and compliance-related payments. Thankfully there are now apps that make it much easier to pull in the data you need to effectively manage your cash flow (from your digital accounting system) and be able to predict—and then alert you to head off—any potential cash flow problems in the coming months.
Making Accounting Digital has to be the way forward if you are not already using a modern accounting system, to save you time and help you make more money. Go MAD to grow, you would be mad not to. To find out more contact one of the directors and we will be excited to help you start the digital process.