The best ERP software development consists of numerous modules which are intricately woven together into one flagship system. As leading ERP software companies scale with the resources available from cloud support services, hosted solutions have long since gained traction in a business landscape that is fiercely competitive, and highly sensitive to change.
Financial software development, on the other hand, closely correlates to ERP software, especially on a macro level. However, on a micro-level, it can still independently function as an application all of its own. With even small businesses adopting ERP systems for managing operations across every department, finance software is often integrated with ERPs in order to facilitate the same.
Virtual collaboration has made ERP software outsourcing also possible, as businesses and software development teams engage in long-term partnerships to build solutions at scale. Dedicated partnerships with leading cloud service providers (such as being an AWS partner, for instance) further spearhead the software development cycle, as relevant resources can be obtained as and when needed, with little to no requirement of physical infrastructure.
All these factors are major contributors to real-time and centralised ERP systems, which work fluidly with a dedicated finance component – so that every department functions from a finance-oriented perspective. Whether it’s being within budget or catering to possible future demand hikes, integrating a finance module in your ERP system can reap massive benefits, both for the short and long term.
Here, we elaborate on the 101 of finance software, and how it can be seamlessly incorporated into your ERP system.
Finance software records, stores, tracks, and analyses all financial data pertaining to an organisation, namely (but not limited to) assets, liabilities, cash flow, and budgets. While accounting management is one of the core features of finance software, it is one out of many components (including external components that can be connected for further amplifying the capabilities of your system).
As a result, modern finance software has progressed beyond only offering accounting management; it now represents a multitude of capabilities that can help your company budget every step of the way, across every department and all the way down to an individual employee level. On top of that, financial analysis now goes hand-in-hand with AI and machine learning to help your organisation derive valuable insights which may otherwise not be possible in legacy systems, and that can aid in wise business decision-making, in turn.
By integrating your finance module into your ERP, all data that flows in and out of the system will be recorded in a single, centralised repository. This central database will serve as a single source of truth for all business departments, with changes updated on a real-time basis. On top of that, accountability for changes can also be facilitated, owing to version control. As a result, errors can be prevented from multiple employees using different versions of the same database or document.
With all data being unified in a single repository, big data can be sourced for data science and business intelligence alike, so insights into the company’s financial wellbeing can be derived for intelligent strategy planning.
An ERP system that is fully integrated with a finance module ensures that every department has access to all the data they need from other departments, in order to perform optimally. With organisations deploying ERP systems generally having long and winding business processes (such as an international supply chain for a manufacturing company) every step in the process will now have all the required information to progress over to the next step.
For example, the inventory database can be integrated with the e-commerce platform, so that any items out of stock can be automatically labelled. Likewise, replenishment optimization can be used to notify customers who would’ve opted in for alerts, once the item is back in stock. In turn, this can positively impact your company’s overall numbers, as fulfilment staff don’t need to refund an order that doesn’t have items in stock, back to a customer.
By configuring processes so that tasks can be done programmatically, your staff will now be free from attending to repetitive matters that consume a significant portion of their time. Customise policies to suit each process, preferably without IT/technical intervention, thanks to user-friendly interfaces that are easy to navigate even for folks who aren’t tech-savvy. For enhancing workflow automation, AI and machine learning can be used to observe regular workflows so that algorithms can provide intelligent recommendations to staff on which processes can be further automated, in the interest of optimising performance.
As financial data is distributed throughout the organisation, every business unit has the financial perspective they need to do their best work. This way, all staff know what their budget limitations are, how much they need to scale in order to meet future demands, and whether they’re complying with legal regulations. Resources are therefore optimised to their fullest, while costs are saved for every granular operation, so that extra manual supervision need not be conducted in order to reconcile inflows and outflows of cash.
Being a vital feature for any finance application, cash flow management consists of numerous other components which, by working together, offers streamlined management of all cash inflows and outflows within a business. Budget management is a key component, which helps managers across the organisation plan their projects wisely, depending on the resources and timeframes available. However, credit, liquidity and asset management all come into the cash flow management mix as well, so that companies are always able to stay on top of correct valuations, including what is owed and what is due.
Another crucial component for any finance application, accounting capabilities offer the essentials for managing the cash inflows and outflows of any business, such as accounts receivables and payables, general ledger, reconciliations and invoice management. Enhanced accounting management systems also offer comprehensive payment processing capabilities, including consumer payments that are done online via an e-commerce platform. By connecting Point of Sale (POS) systems to your accounting application, every transaction that takes place can be automatically logged and reconciled, without having to wait for reports that take place at the end of every week or quarter.
By tracking every expense that your staff engages in, managers have a bird’s eye view of whether projects are being executed within budget. Additionally, managers can review and approve/reject expense requests while being on the go, through self-service systems that are facilitated via mobile apps. Self-service can also be used by employees, as they can automatically upload copies of receipts with a snapshot over a smartphone – with computer vision technology automatically detecting text and numbers, for entry into the system.
Being the cornerstone of any financially robust business, budget management capabilities ensure every department adheres to pre-set budgets in order to keep costs at a minimum, while having sufficient funds to undertake their responsibilities. Using reporting tools can further assist with the budgeting process, as predictive analytics can forecast potential sales and production trends for upcoming quarters or seasons. Budgets can therefore be scaled up or down, so that company funds are utilised optimally, and in the most cost-effective manner.
In order to pay relevant taxes according to local, state, federal and international regulations, tax management systems can automatically detect zones/regions and make filings on behalf of your organisation. Depending on your region, and the working basis of personnel you hire (full-time, part-time and/or contractor), relevant tax forms also need to be filled and processed, in preparation for tax season.
By enabling businesses to comply with their applicable tax regulations, tax management systems can be integrated with accounting and finance modules, so every transaction is logged and monitored with its relevant payable taxes as part of the process.
As finance software is a recipient and processor of numerous forms of confidential data (such as credit card details) businesses need to be compliant as per the regulations laid out by relevant authorised bodies – else risk legal liabilities. By conducting timely audits, mainstream Governance, Risk and Compliance (GRC) systems can assist with a variety of compliance-related activities, such as privacy, inspection and even sustainability management. For smaller businesses, only the necessary components can be configured, so that software costs are kept to a minimum – while having what is needed to maintain legal compliance.
A significant part of successful financial management is the ability to plan future strategies in the interest of meeting objectives, and creating business growth. Many finance management applications come with dedicated strategy planning functionalities, which monitor performance metrics across the entire organisation, and report on progress for better decision making. Leading strategy planning systems also offer scenario testing, where assumptive numbers can be inputted to reveal hypothetical conclusions, based on historical data.
What is really ailing your staff, when it comes to managing the flow of funds in your organisation? Are there any bottlenecks, or is important data unavailable for them to reach their goals? Ask relevant team members these questions, including any others which shed light on the issues they may be facing. Make sure a randomised set of team members are consulted for this exercise, so multiple perspectives can be drawn from across the organisation.
Collate your team members’ responses into a detailed business assessment. Also elaborate on what needs to change/improve, from a business point of view. This brief will be the primary point of reference both for you and your software development team.
Share the business assessment you’ve just composed with your software development team. While you may have your own ideas about what needs to change/improve, your software development team can facilitate the same from a technology point of view, by building the right applications to meet your business goals.
A Minimum Viable Product (MVP) is a convenient means of building the first version of any software, as it will only consist of the most essential capabilities. Therefore, software development teams only need to focus on a minimal set of features, which will, in turn, help deliver a quality first version over a much shorter period of time. On top of that, users will also have less features to get accustomed to, thereby reducing the learning curve which needs to be bypassed before the software can be made to reach peak levels of productivity.
Upgrades can be made based on bugs reported in the existing version, along with feedback from users. This way, only features which are necessary/useful will be part of your system – as opposed to having a plethora of features in the beginning, with only a few being relied on eventually.
As the world continues to get fast-paced and competitive, being able to stay on top of stringent financial management is imperative, in order to stay relevant in the marketplace. Integrated with flagship ERP systems, finance modules enable everything from fundamental accounting and cash flow, to specialised compliance and regulatory management. Which components are right for your business is a combination of assessing what goals need to be achieved, along with the technologies required to scale for future growth.
With the right finance software, ERP systems will be equipped with the capabilities required to create greater financial transparency across the organisation, while maximising accountability down to a departmental and individual level. With greater freedom afforded through workflow automation, your staff will now be able to focus on tasks that require more of their strategic attention – thereby increasing workforce productivity as well.
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