Evaluating Your Accounting Software: Key Factors to Consider

Traditional ERP systems were developed to help organizations manage their basic finance and accounting tasks. They have since emerged into a powerful ecosystem that offers robust functionality and presents actionable insights for better decision-making. Finance leaders can collaborate with other departments to generate accurate forecasts, navigate the ever-changing business landscape, and execute their growth strategy. In this article, we will run through a checklist to help you evaluate the right software solutions. 

First, you need to determine whether you’ve outgrown your current solution. Do any of the following scenarios sound familiar? 

• A lack of automation has led you to rely on error-prone manual processes.  
• Integrations have been replaced by manual workarounds and duplicate data entry. 
• Your team is spending too much time manipulating data in Excel to make data-driven decisions. 
• Your system cannot support your multi-entity business due to a lack of centralized entity-management. 
• Accessing your system remotely isn’t possible or requires an expensive remote access server. 

Having the right solution can help you achieve your strategic objectives. However, keeping an outdated software can hinder your organization’s growth and expose your business to market risks. With so many options available, it’s easy to choose the wrong fit or simply stick with what you have. We all become comfortable with what we know or how we do things. Though we are not suggesting diving headfirst into an implementation, indecision shouldn’t prevent you from moving forward either.  

To help start you on your journey toward digital transformation, here is a helpful evaluation checklist when evaluating the right solution. 

1. Requirements Gathering:  

A crucial step in the decision-making process. It involves understanding documenting specific needs or constraints as an organization. Start with clearly articulating the objectives and goals the software solution is expected to achieve. It is a good idea to identify and involve key stakeholders to gather diverse perspectives. 

Helpful Questions to Ask Yourself: 

• What are the current issues? 

• What do I need the new software to do? 

• Who will use it most and for what? Where? 

• Do we need our accounting software to integrate with other software systems? 

• Can it help me eliminate the need for other applications? 

2. Top priorities and challenges:  

Determine which features and functionalities the software must have to meet your organization’s objectives. Prioritize features based on which are critical to the business processes and success. For instance, determine your users’ requirements, your organization’s functional requirements, your system’s integration requirements, and your industry’s regulatory compliance. 

Some Examples: 

• Having the ability to access and tailor reports. 

• Having real-time visibility into the status of all processes. 

• Having the ability to conduct demand planning and forecasting. 

• The ability to collaborate across departments and divisions in real-time. 

• Having the ability to share and integrate data with other systems. 

3. Options Research:  

Go online to develop a short list of publishers and/or vendors. You can compare capabilities, offerings, and customer reviews.  

 
Helpful Questions to Ask: 

• Does the publisher have solutions tailored to your industry? 

• Can the accounting system adapt to your optimal organizational structure and workflows? 

• How innovative is the solution compared to others on the market? 

• Does the vendor have a proven track record of successful implementations with customers? 

• Does the publisher have good peer reviews and testimonials? 

4. Request for Proposal (RFP):  

Once you have selected a short list of vendors, craft an RFP. This document should list your needs, expectations, and parameters so you can make an apples-to-apples comparison solution. 

What to Include in an RFP: 

• Project Overview & Goals 

• Scope of Work 

• Current Roadblocks & Barriers to Success 

• Evaluation Metrics & Criteria 

• Submission Requirements 

5. Demo or Trial:  

Conduct a proof-of-concept testing to validate how well the software meets your requirements. Involve end-users in testing to gather feedback on the usability and functionality. 

Helpful Questions to Ask: 

• Does the ERP system meet the requirements and criteria set out in the RFP? 

• Is the software easy to learn and use? 

• Does the software require customization or other applications to fill in capability gaps? 

• Does the ERP system integrate with other business systems? 

• How easily can existing data be migrated? 

6. Product Fit:  

Assess how well each software solution aligns with your organization’s needs, goals, and constraints. Ensure that it can handle increased data, users, and transactions over time. 

Helpful Questions to Ask: 

• Will it provide a modern general ledger that enables you to manage, analyze, and present your financial information the way you want? 

• Will it help to shorten our reporting cycles and provide in-depth insight? 

• Will the system automate time-consuming manual processes? 

• Will the system offer enough agility to cope with changing needs? 

• Is there financial and organizational commitment to continued investment and support of the accounting system? 

7. Check references, score, and select:  

Take the time to develop your business case by identifying how the investment will improve your organization. Two key indicators include calculating a proper Return-on-Investment (ROI) and Total-Cost-Ownership (TOC) scenarios. Finally, check references or your peers about their experiences with each solution. 

By following a structured approach to gathering requirements, you can make more informed decisions when evaluating software options and increase the likelihood of selecting a solution that aligns with your organization's needs and goals.