Accounting software packages: it's a jungle out there
24 Apr 2008, John Tate, AccountancyAge
http://www.accountancyage.com/aa/opinion/1762408/accounting-software-packages-jungle
Accountants are not over the moon about their finance systems. This is despite packaged software being around for nearly 30 years.
Charity Finance surveyed 300 organisations in the not-for-profit sector on the use of IT. Just 11% rated their accounting systems as very good, while 45% viewed their systems as average or poor. Nearly one-third were considering replacing their systems in the next year. Not impressive reading. While this research only looked at one ‘vertical’ market, I believe this picture is repeated in the commercial world.
Compare this to other packaged software, such as spreadsheets or word processors. User satisfaction levels are much higher and the market has concentrated into a few applications. By contrast, there are thousands of accounting software packages on sale or in use worldwide.
So what of the future? Will the existing vendors deliver a knock-out product that will rule the world? At the entry level, Microsoft has launched a package that is getting some interest. But the product is focused on the UK and US markets and there appear to be no short-term plans to roll it out globally, which will limit penetration.
Sage continues to focus its growth strategy on acquisition. For example, at the end of last month, it acquired UK construction software specialist Tekton for £21m. One interesting aspect of this purchase is that Tekton’s software, EVision, is based on one of Microsoft’s accounting products Dynamics NAV. Sage has made its money by acquiring dozens of products and generating good profits from the user bases. Sage is not at its heart a software developer.
Another recent story was the acquisition of Armstrong Consulting by Access Technology Group (owners of Access Accounting). Armstrong Consulting has a focus on the professional services and service management markets and is a reseller of Access Accounts.
So, if companies like Sage and Access are going to focus their growth via acquisition, will we ever get the killer application? One wonders whether the only chance of this happening is with a new player. Google? Salesforce? Who knows?
John Tate is the IT adviser to the Charity Finance Directors Group. He blogs for Accountancy Age on IT issues at technologymatters.accountancyage.com
© Incisive Media Investments Limited 2012, Published by Incisive Financial Publishing Limited, Haymarket House, 28-29 Haymarket, London SW1Y 4RX, are companies registered in England and Wales with company registration numbers 04252091 & 04252093
Visitor comments
it's a jungle out there
John,
Integration is a key issue here.
Why are we still having to jump around to different products to make a simple address change for a client or customer? or wasting time keying in a Trial balance in to accounts production software.
For the past twenty years the accounting profession has bought sotfware ranging from time & fees, tax, accounts production, practice and bookeeping accounts software.
In a lot of cases none of these packages talk to one another, some will integrate with excel and word and others won't.
The ICAEW IT 2006 report recommended that software suppliers took up the challenge of integration. But that will only work when we a single platform to work with and an openess of suppliers to link with one another.
A single database that integrates and updates all of the software for the business or practice and has the ability to store documents and spreadsheets is what's required.
We have made some headway with our DRIVE CRM product for Accountants and we are open to any other suppliers who would like to integrate.
Ultimately, it is the buyer who should be demanding more integration from their suppliers. Then we might just get the perfect solution.
Posted by: Anthony Fallon , 25 Apr 2008 | 00:00
Access Technology Group acquisition
This article makes interesting reading, John. Access Technology Group has undoubtedly grown through acquisition and found great advantage in this consolidating environment which has enabled us to increase our turnover every year. Hence, we find ourselves in the unique position of being the largest independent business software house in the UK and Ireland, which offers many advantages to customers.
These advantages include autonomy to react very quickly to the needs and demands of our customers. We don?t have to answer to the stock market or investors, which means we have the financial resources to invest in research and development that is essential to maintain our customers? competitive advantage.
Indeed one of the main reasons we bought Armstrong Consultants was because of their IP and development capabilities. There are some excellent synergies between our companies, and with their vertical applications and expertise, they fit very well within our remit to strengthen our portfolio across the whole of our network of accredited Access Specialist Centres. As a custom house they are extremely end-user focused and their customer development capabilities will accelerate and drive our development towards ensuring our products are the best on the market at meeting the needs of the end user. So therefore it fits with our mandate to acquire vertical market applications that require close integration to financials, and it is our intention to see this strengthened.
In contrast to buying large user bases, Access Technology Group seeks acquisition targets in its own image. We look for likeminded companies who share a passion for developing innovative solutions and can demonstrate a real determination to succeed. So growth will continue through acquisition - but only where it strengthens our product portfolio to the benefit of all our customers, and hence to the benefit of our business.
Posted by: Alistair O'Reilly, Group Managing Director, Access Technology Group , 30 May 2008 | 00:00
HansaWorld Price increases
news that might be of interest
HansaWorld software price increases
e.g
named user £650 upto £1150
this is on new purchases of users and modules
maintenance for customers will be calculated at new price
therefore increase in yearly maintenace
most customers with 10+ users will see increase in costs
Posted by: unhappy customer , 26 Jan 2009 | 00:00