Accounting systems play a critical role in helping business managers run their organizations. Effective accounting systems perform daily operational processes in an efficient manner and provide users with the information they need in a timely fashion.
Here are four key trends currently impacting the accounting software industry.
1. Moving Into the Cloud
The emergence of the cloud is a hot trend within the accounting software industry. All major accounting software applications have a cloud version either in play or planned.
A cloud approach is a compelling choice for companies looking to outsource hardware and software support in order to normalize costs and concentrate on core competencies. Natively web-based options also allow an easy extension of system access to remote users and branch offices.
The ability to directly access systems with just a web browser enables another core benefit—utilizing business data and systems anytime and anywhere.
Finally, the subscription pricing model is proving to be appealing to companies looking to spread software costs out over time and avoid larger upfront investments.
2. Increased Functionality
If you have spent any time looking at current accounting software systems, you have likely noticed that they typically include many modules and applications that stretch the traditional definition of “accounting software.” Accounting software packages are now just as likely to include functionality to support the supply chain, manufacturing, HR, marketing and sales, and other functional business areas.
Comprehensive accounting software packages (often referred to as ERP software) offer a few major benefits. The breadth of functionality means less need to support complicated inter-module integrations, which can greatly help to reduce support costs. Single systems also provide a consistent data-set, so that changes in one area of a system are reflected in real-time in others. Along with less duplication of work, a single data record can help improve transparency and remove interdepartmental bottlenecks.
3. Application Integration
While ERP packages are becoming increasingly common, another trend to be aware of is the improvement in integration options for companies looking to leverage existing systems. There is a burgeoning community of software developers specializing in 3rd party add-on software designed to work with the more common base accounting software platforms.
Core accounting system developers are doing their part, too, by becoming increasingly accommodating in terms of helping 3rd party developers extend core system functionality. Significantly, developers of base platform systems are putting more work than ever into developing, documenting, and publicizing application programming interfaces (APIs) that allow 3rd party providers to pass data to and from accounting software. The trend towards increased API availability is only anticipated to continue.
The desire to use data to guide strategic decision-making is not new. The pronounced emphasis on what has come to be known as business intelligence tools in accounting software is a new development though. It turns out the effect of business analytics tools on corporate performance is measurable, as well. Recent studies have suggested that top performing companies are almost twice as likely as the bottom performers to integrate business analytics tools such as management dashboards with their ERP.
Companies are now looking to go beyond analyzing assets and liabilities and revenues and expenses when considering financial performance. The ability to assess more granular key performance indicators is a demand the software industry is working hard to meet. This trend is visible in the increased number of management dashboard-type modules being offered and the variety of graphical options for displaying data. Similarly, there has been a widespread focus among software developers to simplify report creation, so decision makers are better equipped to turn data into actionable business information.
You may also like: