Where do you start with a cloud accounting software comparison?

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Best... Sarah

I'd start with defining your accounting and finance needs. Then, you can start to narrow down on companies that meet most of those needs.

By no means technical guidance but I would start with the question "how do you make money" and identify the key requirements for tracking revenue and associated costs for your business.

Are you a professional services business, subscription based business, construction firm? Is each sale closed by a salesperson or do you sell a product that customers purchase on their own? Does your business invest heavily in capex or carry inventory?

What are the key metrics you will need to report to senior-management and will the systems you are evaluating streamline this for you?

I'd also review your existing systems and consider whether you would be replacing them or building around/integrating with them.

There are a few "must haves" that you will identify specific to your company and as a result you will end up with a list of requirements that are best met by a short list of the software system providers.

You will also have the opportunity to speak with existing customers about their experience as part of the eval process. Make sure you speak with someone with a business similar to yours, if available.

First develop your requirements, once you do that it will be a lot easier to decide which software to use. Here is a link to an site that provides some free RFP documents. http://www.infotivity.com/accounting-system-criteria-detail.html

As you talk with providers, I would also be clear about how they can meet your requirements. To understand total cost of ownership, determine if they can meet your requirement "out of the box", with configuration (a built in option), or with customization (programming changes). Customization tends to be more expensive to go live and maintain.

Paul's suggestion to focus on the top issues your organization faces is very sound. Most companies have some requirements that are generally applicable to many companies (say for Accounts Payable), and some specific functional or financial requirements that are unique to your industry or your business model(s). Those unique areas are where you should focus your evaluation first - that is where any ERP solution will potentially add the most value.

ERP systems have thousands of features - and ERP providers all have their own perspective on the relative value of those features compared to the market as a whole. In the end your own top criteria should drive your decision - if you don't understand your own requirements the process will become confusing and complex.

Bob Scarborough
www.tensoft.com

Its hard to answer these broad questions. Are you seeking to evaluate cloud accounting software or are you considering a full cloud implementation.

Financing and security would be the first things to think about, then you want to identify the value adds for your business.

Determining which software apps to convert to is the same as evaluating any software application.

Some people simply want a cloud accounting environment, others want a desktop environment. Some companies try it out incrementally.

There are a lot of opinions.

One thing you might do to educate yourself about the overall value is to take a look at the videos on Intacct.com, you can sign up for a demo session with Bill.com.

If your company is interested in a certain cloud host, be sure that they are in compliance with all the software licenses that you run on, if not you will be in violation of software licenses.

If you are interested in certain saas software, just sign up for a demo to see if you want to put it on your list of options, and ask the teams you talk to about implementation and what the process is.

Agree with others - certainly start by knowing the key drivers for your business and what's needed to measure the business effectively. Systems integrations and closing the books efficiently are more tactical concerns.

Generally speaking, I would say never overpay for a solution. Sounds obvious but what I mean is don't spend $1 million on big 3 ERP and end up utilizing 50% of the functionaltiy. Better to spend $100K and use 80-90% of the functionality. Finance/accounting is back office, not your core business. For small to mid-size businesses, cloud/SaaS is compelling..... maybe even Fortune 500 as well as the marketspace matures.

I would first start with having a solid understanding of your internal requirements in regards to accounting, workflow and financial needs as well as any usability preferences. Once you have those down on paper, start contacting vendors and narrow down as you go along. Finally try to get some form of trial / test platform before you are fully on-board.

Interesting, no one mentioned obtaining executive team alignment and then agreeing on what the financial system needed to provide.

Each C-Level sphere will have some requirements, and some of everyones requirements will be on the basic requirement list, must need list and wish list.

But as a CFO to work in their own cloud (sorry had to use the pun) without team alignment is a guarantee of future headaches (and possibly failure).