How to Transition to a Cloud ERP Without Disrupting Financial Reporting Processes
More and more companies are migrating their enterprise resource planning (ERP) to the cloud. It relieves them of the burdens typically associated with installing and maintaining complex software systems, and it’s arguably more secure because it’s monitored 24/7 by dedicated experts. There is no question that cloud-based ERPs like NetSuite, Epicor, Microsoft Dynamics, and Oracle Cloud are gaining steam.
Rolling out a new ERP system can be highly disruptive to your organization, though. It usually involves reworking business processes to match the new system, re-training the personnel who use the ERP software, and integrating your other IT systems with the new cloud-based ERP.
It’s good practice to look for any way that change can be minimized. If you can handle some elements of the changeover ahead of time, for example, that will serve to smooth the transition and establish a strong sense of continuity. Financial reporting is an ideal candidate for this. By planning ahead, organizations transitioning their ERP to the cloud can ensure that the switch can take place without disrupting the financial reporting process. That instills confidence in executive management–the stakeholders who care most about monitoring the organization’s performance.
The Many Problems of Manual Reporting Processes
The majority of organizations are still using manual methods to gather information from multiple software systems, collate and organize it, then apply formatting to suit their needs. This can be tremendously burdensome for finance teams already stretched thin and struggling to do more with less. Let’s consider some ‌challenges they face:
Tedious export/import or copy/paste processes: Manual reporting processes typically involve exporting data from your ERP system (and perhaps from another software package as well), then importing it into a spreadsheet where it can be easily filtered, sorted, and formatted. The problem is that the exported data rarely conforms to the format you need. After all, that’s the very reason for bringing it into a spreadsheet in the first place. Someone needs to massage the data, remove any extraneous content, add formulas, apply formatting, and perhaps even include some narrative explanations.
If you’re only performing that process once, it might not be so bad, but when your finance team must go through all of those steps over and over again, it adds up to a tremendous amount of work. Imagine that you’re performing the month-end close, and you discover the need to add just one more journal entry. Unfortunately, it affects several accounts that impact both the income statement and balance sheet. At best, that means making manual changes to the spreadsheet you’ve spent so much time carefully crafting. At worst, it means redoing the whole thing.
A high risk of errors: Another major issue with manual reporting processes is the high likelihood of introducing errors into the data. This can happen for several different reasons. Imagine, for example, that your finance team has built a spreadsheet that summarizes general ledger data imported from the ERP system. They have built a series of complex formulas that seem to work perfectly every time.
Then, your company adds a few new general ledger (GL) accounts to the chart. All of a sudden, you have new rows in your source data. Those complicated formulas no longer work properly because they weren’t designed to accommodate that kind of change. What’s even worse is that these kinds of errors are often overlooked until after an erroneous report has been presented to management or published to an external audience.
A static (therefore outdated) view of the business: Another major problem with manual processes is that they don’t reflect what’s happening in the business in real time. Every time you do an export from your ERP system, you’re taking a snapshot of the data that only reflects a single moment in time. Any activity that occurs from that point forward is not reflected in the report. Consequently, any financial reports that you build using manual methods are immediately out of date, starting from the moment they are created.
We live in a rapidly changing world. The current environment calls for a quick response to opportunities and threats. That means having rapid access to information so that management can monitor events in real time and act quickly when the situation calls for it.
Limited collaboration and version control: Manual spreadsheets typically lack the ‌powerful collaboration features needed in today’s business environment. It’s essential that finance teams have strong communication tools, version control, and the ability to distribute reports securely and efficiently. Using spreadsheets as a standalone tool, with files stored and managed on individual users’ hard drives, is inefficient and risky. Newer versions of a file may inadvertently be overwritten by outdated versions. Worse yet, information may be lost altogether in the event that a laptop is stolen or a hard drive fails.
The challenge of effective collaboration has become even more important at a time when remote work has become the norm for many organizations.
Creating a Smooth Transition to Cloud ERP
If your organization is thinking about an ERP migration to the cloud, now is the perfect time to make the shift to a robust, purpose-built financial reporting solution. By upgrading your reporting capabilities today, you can create immediate value for your company while building a bridge that will ease your transition to cloud ERP when the time comes.
Spreadsheet Server from insightsoftware enables your finance team to produce flexible, powerful reports using Microsoft Excel. It connects directly to your live ERP data, so instead of grappling with the challenges and shortcomings of manual processes, Spreadsheet Server shows you exactly what’s happening in your business in real time.
Because Spreadsheet Server connects to over 140 different ERP systems out-of-the-box, the transition to a new ERP system can happen seamlessly, without changing out your financial reporting tools. That reduces the time, expense, and risk associated with your ERP implementation because there is no need to design and develop new reports or to train personnel in the use of new reporting software. It also provides a strong sense of continuity during an otherwise disruptive process.
If your organization is considering a transition to cloud ERP, or even if you’re unhappy with your current manual reporting processes, it’s well worth spending a bit of your time to learn more about Spreadsheet Server.
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