I happened to be going through some old files a few weeks back and came across a quote for a new server for our firm from 1987. Quoted Price $89,430.00 - 1 Mg Memory, 320 Mg HD. No doubt it was cutting edge at the time and an essential investment for our business. It of course highlighted just how far technology has advanced.

As it is for a lot of our clients technology is still a significant investment for our business. Today, as opposed to 1987, there is any multitude of cost effective solutions to consider. One of those solutions is Cloud computing.

Cloud computing is the latest buzz word or if you are a bit cynical the latest marketing tool. It is the delivery of computing as a service over the internet rather than as a product. That service might be unique to you or one that is obtainable by any number of users. It is often seen as an anytime anywhere solution.

So why would I consider taking what I am doing now and moving it into an internet based environment? Well one benefit is that you are not implementing hardware which comes with upfront cost for the physical component but also ongoing cost of administration and maintenance. As small business owners we should always look at leveraging the expertise of others and this, we believe, is one of those opportunities.

As long as you have a device that can obtain a 'working' internet connection then you have access to a Cloud based solution. It does not matter if you are located in the office or at the local coffee shop.  Of course this may seem a bit too simplistic as everyone I am sure can recall an internet outage of some form or another. Just recently we lost our own internet connection after a contractor unknowingly cut through a cable by mistake and then proceeded to cement it all in! 

There are many forms of Cloud computing. SaaS - software as a service, Utility computing, Web services in the cloud, PaaS - platform as a service, MSP - managed service providers, and the list goes on. But it is probably software as a service (SaaS) that offers the path of least resistance to the average small to medium business.

Simplified examples of SaaS are Microsofts recent offering of Office365  and Google with Google Docs.  Essentially office suite applications hosted over the internet with in built storage capacity - think file server.

           
Of more relevance to us as your adviser though are the potentials offered by way of business software as a service. The Cloud environment enables the accounting data to be accessed from a secure data centre by both you the business owner and us as your accountants via the internet.

The benefit for everyone in this arrangement is that we are all looking at the same 'real time' general ledger. Eliminating the duplication through multiple copies of data and then trying to synchronise adjusting entries between two copies of the same ledger. It also allows us to identify business issues as they arise rather than after the event availing us with the opportunities to do what we should be doing with you - advising.

Another benefit is that these business software offerings are receiving automated data feeds from banks and other financial institutions allowing for fast coding saving time and reducing error rates. They also provide for greater connectivity with other web based offerings such as CRM packages like SalesForce.com (another example of SaaS), Job Tracking such as Workflow Max, E-commerce, Point of Sales connections, and many more applications.

At least two examples of these offerings come in the form of Xero and Saasu




www.xero.com                            

Xero offers most of the areas a small business would need including fixed assets. For those business that need integrated payroll or inventories this currently requires an add-on solution. The company has just purchased Australian company Paycycle to develop its payroll functionality into Xero.

   

www.saasu.com

Saasu (the u stands for utility) offers inventory and payroll and is a genuine competitor to the Myob's of the world. By using an application programming interface (API) other software and web applications can easily interact with Saasu resulting in a growing choice of connections with other business applications.

Both offer mobile connectivity through app applications for iPad and iPhone.

The major business software providers, Myob and Quickbooks, are both offering 'light' versions of their products as an online service. These products at the moment are aimed at the sole trader, business start-ups running a simple cash book type arrangement. However we envisage that once the SaaS market matures they will move all products into this model.

Of course it is essential that risks (e.g. security) associated with these environment are addressed before moving into this market space however they are no different to the assessment you would/ should make of your own current internal environments.

We have no doubt though that the SaaS Cloud environment will mature and grow and will be enhanced by the roll out of the National Broadband Network (NBN). We see the NBN as a major game changer for SME businesses in this country. Faster internet speeds will change the way many of us approach our business software and hardware requirements.

How we can help.

It makes sense to talk to your accountants before implementing a new accounting system. Too often we see clients dazzled by the sales pitch and flashy graphics and not drill down to find out if the product will meet your business needs.

We don't profess to be software experts, but we do know what your business needs and have firsthand experience with many of the systems on offer.