The information we get from timely and accurate accounting is critical to running a successful business. The overhead associated with the accounting function does not create additional revenue. Therefore, an important feature of any accounting software is its ability to maximize productivity of the accounting staff so we can do more with fewer people.
I have seen two strategies that accounting software developers have used to improve productivity. The more traditional strategy includes shifting as much of the burden of each accounting task as possible from the accountant to the application. It also includes making the application intuitive and easy to use, which minimizes training costs.
The other productivity strategy is synergy: combining operational and accounting functions to eliminate duplication of effort.
Productivity Through Ease of Use
One way to improve productivity is to increase the speed with which transactions can be entered. If I can enter three transactions per minute in one application in the time it takes to enter one transaction in another, I have tripled my productivity. Here’s one of many examples of how increased productivity is accomplished.
I’m entering a vendor bill for the purchase of a new printer and a box of paper from Office Depot on a form that has a drop-down list for the vendor name and for each asset or expense category that make up the purchase.
Rather than click the drop-down list and scroll down to Office Depot, I simply type “of” and depress my Tab key to move to the next field. My application filters my selection list with each key I type. In this case, there is only one vendor whose name starts with “of.” The same technique applies to the items purchased, for example, “Furniture & Equipment” and “Office Supplies.”
Productivity Through Synergy
I have this great client that provides expertise in data warehouse technology. Along with licensing of products and services, it provides hourly consulting for database design and development and enterprise data integration.
All employees are salaried and they are using an online timekeeping application as a front end to assign billable charges to clients and projects. This is the first synergy: Employees are entering their time online instead of recording it on paper for accounting staff to enter. We’ve eliminated a duplication of effort.
They are also now preparing to take advantage of that timekeeping front end to allocate the cost of payroll and employee benefits to projects and jobs, which allows them to look at profitability by customer and job. This additional capability comes with no additional cost, including accounting staff time, because employees are logging their time to projects already.
Here’s how it works for salaried employees: Every employee must account for at least eight hours of their time for each workday, which can include tasks for customers and jobs, sick time, or vacation time, with any remaining time to be assigned to unallocated time. When payroll is processed, the accounting application prorates the payroll costs, including the employer share of benefits, based on the time recorded for each job divided by the total time worked.
I repeat: This additional reporting capability will not require additional time of the accounting staff and will not result in any additional cost outlay. It is already a capability built into the accounting software. You might want to see if your accounting software has any hidden assets or inexpensive add-ons that can increase your productivity for little or no additional investment.