Questions to ask yourself before choosing your financial consolidation software

Writen by Stefan Farrugia • 10th January 2018 < back

When beginning the search for the best financial consolidation software, most will start by analysing their requirements.

However, according to Chris Iervolino, Research Director at Gartner, it’s also worthwhile to evaluate the software to understand what it has to offer.

But before you choose your accounting consolidation software…

We reached out to Chris because he is as an expert in Financial Planning and Analysis and Financial Close applications and advisor to CFO’s, with more than 25 years experience in the industry, and a doctorate in computing.

“There are questions to ask which may lead to more transformational process changes…” Chris says “What can the product do and would that be of value for our organisation?”

Chris recommends CFOs ask functional questions encompassing what will be needed both today and tomorrow before attempting to put together a list of contenders for the best software to suit your needs.

Cloud Vs on-Premise Accounting Consolidation Software
You need to make sure that stakeholders and decision-makers are on-board with one main decision. Where will the data be hosted? You do not want to spend months shopping around and negotiating with suppliers only to find out that head-office has a policy that no accounting data can be stored on the cloud. This could totally derail you if left for later. It is a decision that needs to be taken on day one.

Understand Your Accounting Consolidation Workflow
You will need to ask a lot of questions to many people. Understand the current workflow at every level. Make sure you don’t just base your decisions on what the workflow looks like on paper. You want to understand how the various team members involved are contributing to the workflow. You also want to make sure they understand (and agree with) how their piece fits into the whole process. This will help you spot areas of deviation from the ‘official’ workflow and also find areas that can be improved. By having all the details freshly documented, you can more easily come to the right conclusion when you’re looking for the best software fit.

Who will deliver the software implementation?
It’s important to understand who will deliver the implementation and deal with the financial consolidation software suppliers. What their skill level is? And what the resource requirements will be. This is important because if you need a lot of external support during the implementation process or have a team with low skill level in this field and need extensive training, you will need to prioritise this when choosing your software supplier.

However, Chris also emphasises the importance of “really honing and knowing the vendors well enough to be able to ask those differentiating questions”.

Understanding your current situation is very important, but perhaps, the most difficult part is understanding the differentiating factors of the options available.
Gartner provides a number of tools and services to help CFOs analyse software vendors; these include their Magic Quadrants.

The Magic Quadrant helps you quickly ascertain how well technology providers are executing their stated visions and how well they are performing within a given market, while companion Critical Capability reports provide more detailed information regarding product capabilities. Together they’re a first step to understanding the technology providers you might consider for a specific investment opportunity.