Last time, I discussed how working with cloud-based software could take your lowly slide presentation and transform it into something dynamic that you could access and update just about anywhere and almost anytime. If that didn’t convince you to make the leap into the business cloud, don’t worry. Powerpoints and their ilk aren’t for everyone – they’re not, ahem, sexy.
You want sexy? Let’s talk accounting! That’s right – few things are less enticing than accounting software, but I’m going to do my best to make number-crunching in the sky a little bit more appealing. You’ve undoubtedly got something you use to track your sales, pay your bills and balance your accounts. It might be a dusty old copy of Excel or an aging QuickBooks program on a dying PC, but it’s there. No modern business runs very well without accounting software.
Accounting is dry and the software packages that handle your accounting are often even drier. Even worse, the accounting software often lives on one computer or an office server with very limited access. This is partly intentional – financial data is confidential, and you need to keep it secure. But it also means that a lot of vital information – even in an abridged format – is only accessible via a gatekeeper of some kind. If you need an updated quarterly report after David in accounting has left for the weekend, you’re probably out of luck.
Cloud-based accounting software changes all that. Now, before you gasp in horror at the idea of putting your financial information in the hands of data centers miles away from your office, rest assured that, in terms of overall reliability and security, cloud-based accounting packages are likely better than what you’ve got on that dusty PC in the back of the office. In fact, the very same folks that created that package may now have a cloud-based version available. For example, the most popular business bookkeeping software, Quickbooks, has a completely online version that matches most of the capabilities of the desktop-based version.
Maybe you’re already using Quickbooks. Why would you want to switch to the cloud-based version? After all, if something’s not broken, you shouldn’t fix it, right? And there’s nothing compelling about accounting software anyway – it’s just numbers, and you’re the person who, as a business owner, has the insight to make sense of them.
The primary reason echoes what I talked about last month: access. Financial information, as dry as it may be, is critical to your business. If you’re dialed in to your business, you want to know about sales, cash-flow and expenses on a daily basis. In the distant past (say, 20 years in technology time), you’d have to wait for someone to prepare that information for you. More recently, if you were in the office, you might be able to fetch that information from your accounting system in real time from one of your office computers. And if you’re really advanced, maybe you connect to your network when you’re out of the office and view reports and ledgers.
When you put all that in the cloud, though, things change dramatically. Is it tax time? Give your CPA their own user name and password, and they never have to even visit your office. Have multiple locations or a bookkeeper with a new baby that wants to work from home? You control the access, giving the appropriate privileges to the users that need them. Reports on the health of your business are available in real time to anyone with an internet connection. Send a quote from the airport lounge, or invoice a client while you’re drinking a beer at the hotel bar. Just don’t spill your drink into the keyboard.
Anytime, anywhere access is great – transformative, even – but there are other good reasons to move to cloud-based accounting software. One is maintenance; although you may be able to limp along with a 12-year-old version of Peachtree on your PC, you eventually have to upgrade, and the maintenance and backups associated with keeping accounting software and data up to date can be a real pain, especially if you don’t have an IT person to help you.
With cloud-based accounting, the only software you need is a web browser. Heck, sometimes you don’t even need that, since some cloud accounting services now have smartphone and tablet apps. But working in a web browser is now a pretty familiar experience for most folks, and just about every modern computer has an internet browser. Getting rid of software and install disks can be surprisingly liberating. You log in, and you’re just there – nothing to install or upgrade.
This also means that you’ll get new features instantly – if the accounting software company adds some nifty new charts and graphs, you don’t have to buy the next version to get it. It’s all included in the subscription fee.
It Costs Money?
Hold up, you say – there’s a monthly fee? Yes, that’s pretty much the way most of these services work: Instead of paying, say, a few hundred bucks for a box with disks in it, you’ll pay a few dozen bucks every month to access the software. If you need a ton of users, you might pay a little more. But that’s the biggest catch – it only works as long as you’re paying for it.
Of course, you’re probably already paying monthly for a wide variety of other services, like utilities or mobile phones or internet access. Still, paying for access to software is often a tough pill for many business owners to swallow when they could just buy something once in a box and replace it only when they have to. In many cases, the long-term costs of cloud-based accounting packages are higher than buying a package with similar capabilities every few years.
The providers of this software know this, and they make great efforts to increase the value proposition of their offerings. For a company like Intuit, the maker of both the “boxed” version of Quickbooks and the online, cloud-based, pay-by-the-month version, they’re going to get your money either way, so you’d think they may not care one way or the other.
But Intuit is pushing hard into cloud-based accounting and adding new features to its Quickbooks Online package at record pace. If you think about their business model, it actually makes a lot of sense – a company like Intuit spends millions providing customer support for its products, and with so many old versions floating around out there, convincing users to migrate to a single, cloud-based version makes their entire support program much simpler.
Quickbooks Online leads the pack in inexpensive cloud-based accounting, but if you’re interested, companies like Xero, Freshbooks, Zoho and many others offer similar products. If your’e concerned about security and data integrity (and you absolutely should be), keep in mind that these companies have backup systems and security mechanisms that go far beyond what you could ever implement for the accounting package you’ve got on your office computer. Of course, if you’re truly paranoid, buy boxed software and put it on a computer with no network connection at all and store your backups off-site in a fire safe. You’ll be safe and secure, and that tinfoil hat looks pretty good on your anyway.
– Brent Buford
A version of this article also appeared in Identity Marketing magazine.