The tag line for Advantage 2015, Intacct’s annual user conference, was “Education, Collaboration, Inspiration.” But the real message I heard was this: The world is changing rapidly and Intacct is doing everything in its power to help customers survive and thrive by helping them keep up with change. In order to keep up today, you can’t sit back and wait for change to occur; you need to anticipate it. You need to make predictions, which was an additional theme running as an undercurrent on the main stage. Indeed Intacct’s CEO Rob Reid delivered some predictions of his own, promising customers, “We are your partner… thinking ahead, innovating ahead, scaling ahead.”
For those of you not familiar with Intacct, it is a cloud financial management solution provider. Bringing cloud computing to finance and accounting, Intacct’s applications are the preferred financial applications for AICPA business solutions and are used by more than 10,500 organizations from startups to public companies. The solution has evolved over time to provide all of the functions necessary to provide an operational and transactional system of record for the types of businesses the company sells to, bringing it more into the realm of an industry-specific ERP.
The Intacct system includes accounting, cash management, purchasing, contract management, financial consolidation, revenue recognition (a particular strength), project accounting, fund accounting, inventory management and financial reporting.
Here are Mr. Reid’s predictions:
Prediction #1: 20 is the new 80
While today finance executives spend 80% of their time completing tasks and 20% of their time planning for the future, Mr. Reid predicts that Intacct customers will flip these percentages, spending 20% of their time completing tasks and 80% planning strategically. I buy into the concept, but perhaps not at that level. Sure you can automate a lot of the tasks performed manually today, but I worry a little about leaders spending four times as much time planning as executing on the strategy.
Prediction #2: The business model is liberated
I view this as less of a prediction than an observation. New business models are disrupting whole industries. You’re already familiar with many of the consumer-oriented examples including Uber (transportation), Airbnb (hospitality), Netflix (entertainment), iTunes (music). But this business model disruption is affecting many other industries. More and more are moving away from simply delivering a product for a price and instead moving into subscription model pricing and delivery. Intacct is well positioned to support customers moving in this direction, including enhancements to its contract billing functionality. So this prediction is meant to exhort customers to adapt models to let their customers consume offerings the way they (the Intacct customers’ customers) want.
Prediction #3: Project finances get a freeze frame and zoom lens.
In this prediction, “project” is used as a noun, not a verb (as in “to project”). This is a prediction with about 100% probability of coming about, because it was simply a means of introducing Intacct Project Management. While Intacct has long been strong in project accounting, this new offering is an exception-based module meant to be used to evaluate progress and performance and predict profitability and utilization… i.e. manage the project rather than just do the accounting. In doing so, customers can assess project health and the impact on financials. Dashboards are meant to “freeze the frame” and give a snapshot of status in real time, also allowing managers to “zoom” in by drilling down to the detailed transactions.
Prediction #4: Finance is strategic planning
Mr. Reid is predicting that the finance department will become “the ultimate strategist.” This has actually been the goal of CFOs for a long time now and there was a time when many were marching determinedly in that direction. Then came Sarbanes Oxley and many took a U-turn and focused primarily on governance and control. By automating finance processes and reporting, many are now in a position to resume that march towards innovation and strategic purpose. But good strategy can’t be just guesswork and bright ideas. It needs to be based on real data and many CFOs still wait for the metrics needed to formulate a strategic plan. When finance departments spend hours, days or weeks gathering this data and formulating the metrics, they are often out-of-date, or even downright wrong, by the time they reach the desk of the CFO.
In days gone by C-level executives, including the CFO, rarely ever put their hands directly on accounting and ERP systems. It was far easier to get data in than to get data and insights back out, and they were just too hard to navigate. That is changing however. Today executives at the majority of companies have direct access to data within these systems, but some take more advantage of this access than others. Those running SaaS solutions (like Intacct’s) seem better positioned to take full advantage (Figure 1).
Figure 1: What level of access does your top executive management have to ERP?
Intacct has been hard at working delivering several different vehicles of communication to make this enterprise data easier to consume, including dashboards and a particular delivery method called “ Intacct Digital Board Books.” With both, decision-makers have instant access to data organized for action. However, Digital Board Books are very industry-specific and the first one off the shelf is designed for software businesses that, like Intacct, deliver software as a service (SaaS).
So for those finance departments running Intacct in a SaaS software business, this prediction is spot on. For nonprofits that depend on fundraising, the prediction is likely to become a reality this fall, when Digital Board Books for Fundraising is scheduled for release. Intacct customers in other segments might have to wait a bit longer, but all the (technical) heavy lifting has been done in producing the first Digital Board Books. Now it is just a question of Intacct selecting and defining the right metrics and developing the content for the “books.” Intacct intends to produce these for each of the major segments in which it is strong, and will also continue to innovate those for SaaS software companies and nonprofits.
Prediction #5: You’ll do more with less. Others will fall behind
This sounded more like a promise than a prediction, a promise of new technologies, faster speed and more automation. This was actually a great segue to Intacct CTO, Aaron Harris, who approached the stage on a hover board. Once on stage he proceeded to demo the new Intacct Collaborate, a new “social” capability based on Salesforce.com’s Chatter product. Through Collaborate, Intacct customers can initiate conversations online, in real time, but more importantly, those conversations can be stored along with the business objects that are the subjects of the conversation: customers, orders, products, etc.
Mint Jutras research consistently finds “social” capabilities at the very bottom of the list of priorities for selecting finance and accounting and ERP solutions. However, when we separately ask how important some of those actual capabilities are (without calling them “social”), the ability to capture and retain conversations is consistently rated as valuable. Forty percent (40%) rate it as useful and 21% say it is a “must have.” And when we look at the responses by millennials, the percentage that rate it as “must have” almost doubles. No surprise there. These younger workers that never knew life without the Internet, are quite accustomed to electronic conversations. It is often their first communication method of choice.
Some of the baby boomers out there might need a little push in this direction, but once there, the value of keeping an audit trail of communication will become very obvious. And the good news is, even though it is based on Salesforce Chatter, you don’t have to be a Salesforce customer in order to use Collaborate. Even better news: it’s free (included in your standard subscription fee).
In addition to Collaborate, Intacct has been investing in its data centers, including the installation of new servers that are 35% faster, with 2X more application server memory. And beyond investing in more computing power, it has also been using newer technology (including in-memory computing) to speed the processing and analysis of data. It has achieved some pretty impressive results:
- Intacct can now process 1 million customer invoices in 4 seconds
- It can produce an analysis report on 20 million orders in 45 seconds
- And it can produce a vendor ledger with 30 million transactions in 33 seconds
All of this investment puts Intacct customers in a very competitive position. We’ll be watching to see if they can make these predictions come true.