Transcript

Martin Bailey

[00.00.00]

Hello and welcome. My name is Martin Bailey. I’m a Partner and charity specialist at Goodman Jones LLP, and I’m joined today by Jamie Allen at 4PointZero, Jamie, do you want to introduce 4PointZero?

Jamie Allen

[00.00.10]

Yes. Thanks, Martin. So yes, my name is Jamie. I’m the CEO of 4PointZero. We’re a digital transformation specialist company. We’ve existed for for ten years. Um, set that up as founder, and we’ve grown quite steadily. Um, a little bit more recently, as technology has evolved and it’s become more prevalent, it’s become a little bit easier. Um, but we’re certainly on a good track and really enjoying our journey.

Martin Bailey

[00.00.34]

We’re here today discussing how organisations can plan and implement successful digital transformation projects. And that’s become particularly relevant in recent times. And I know from my own work with working with charities of various sectors and various sizes and income levels over the last few years that the sector has been through some enormous challenges. There was the Covid and the impact on fundraising and operations, and trying to carry out their charitable activities remotely. We’ve been through Cost of Living, which has also added increased pressure onto the services that charities are required to deliver. So it’s become really important recently, while charities are carrying out their fundraising activities that they are aware of their own costs and financial position that can help with their fundraising activities, but also make sure they have a clear, clear understanding of where of the resources that they need. And this is really important that they have an up to date finance system with live data that allows them to understand their current position and make decisions. So, Jamie, in terms of having an accounting and finance system that’s up to date and providing the information needed, it might be that a transformation and process has to be gone through. So what are the benefits of change?

Jamie Allen

[00.01.48]

Yeah. So from a benefits perspective is going to be related to your specific organisation and the challenges that you’re facing. Typically from making any change within a business, you’re going to consider it from the fact it’s going to provide an extra added value, and that you’re going to be paying an appropriate amount that you value that change against. Right. So depending on your organisation and the challenges, it might be that you want to increase fundraising and the ability to be able to report to your fundraisers in a timely manner with accurate data, with appropriate backing is exceptionally important. It might be important from a cost control perspective if you want to implement stricter or more regimented cost controls into your business, or even just nurturing more modern technology techniques that currently don’t exist in your business. So if you really live in a world where people are more mobile, if you need people to be out spending money in a more controlled way, but that facilitates that mobility, there are new techniques such as, you know, prepaid cards that enable you to put in funding limits on people to go out and spend. So. Typically when I will go and meet a customer, a lot of the focus will be on what are your challenges? You tell like, I’m not here to tell you what your problems are. You will you, you will probably feel and know what your problems are, right? And my job is then to facilitate or provide the technology or the processes, or work with the people to to make sure that we’re all engaged in solving the problems that matter to you as a business. Otherwise, you’re not going to obtain the value. And ultimately we’re not going to have a happy ending.

Martin Bailey

[00.03.22]

Absolutely. And do you find that that’s often an easier to solve all problems at once, or can you do things piecemeal?

Jamie Allen

[00.03.30]

Um, it will. There will always be a level which is a minimum viable product, which is you can’t go in and implement something that isn’t going to deliver business as usual activities. That’s the bar. You can’t go below that and you have to have an appropriate project plan and timing and milestones agreed by everyone and also engaged with everyone. Um, from a people perspective, that’s critical, um, to ensure a successful delivery. Um, and that’s typically what we will do when we engage on a project and everyone agrees to it. And we also agree that there is participation at each level of the business.

Martin Bailey

[00.04.06]

You mentioned about about planning and having a timeline and engaging everyone. That’s really important. I think some people see it as well. We get a new piece of kit, we install it, we do the training, that’s it. But that’s not the case. Is it that that involving everybody and planning realistic timelines is key? Yeah.

Jamie Allen

[00.04.23]

I mean, you’ve got to always imagine this from a human perspective, because the biggest variable in any project is not the technology. The technology does what it does. You’ve got to be able to get humans to use the technology or set the technology up to succeed. So the biggest variable in all of this is the people and a common, um, common area that can fall down in this is actually making sure that the people that are going to have the responsibility of using this on an ongoing basis feel supported. You know, it can can often be a one dimensional perspective if if senior leadership are the drivers of change, they’re saying, we want this change. We’re imparting this change on you for that person, the incumbent of that finance system, to feel, you know, that they’ve they’ve been handed a problem that they didn’t ask for. Um, that can be very 50 over 50 in terms of whether that incumbent of the finance system, that head of finance, that finance controller wants to change or they can be quite resistant. Um, so making sure and that’s not just necessarily the financial controller that could be the bookkeeper. That could be at any various levels. So making sure that you’ve got the appropriate touchpoints with the various people with senior leadership involvement is really important to make sure that you’ve that that person feels supported in the fact that they’re going to engage in what is a reasonably seismic change within their within their department.

Martin Bailey

[00.05.51]

Absolutely. The old adage of you only get out of it, what we kind of put in a project is going to be successful. If you have that engagement across the board, and you might find that there’s one small area of somebody inputting a tiny bit of data into a system, and if they haven’t bought in, it can just that ripple effect throughout the year.

Jamie Allen

[00.06.08]

And it’s just also feeling supported. Right. So, you know, if say, something unforeseen happens, something goes wrong in the scoping. You know, not every project goes perfectly. Um, that financial controller doesn’t want to feel that they’re in a position where, let’s say the provider who who is going to be, um, interested in their own perspectives, you know, this didn’t happen or that didn’t happen or we didn’t know about this. What that financial controller, who is now who is going to be ultimately responsible for delivery internally within the organisation, doesn’t want to feel is that they’re going to receive the blame for something that ultimately they probably don’t have a lot of experience of doing. They’re. They’ve never done. They like. Like they’re not qualified to do it. Like it’s the first time for them. Um, and ultimately, you know. They’re getting held responsible for for those, for those for this, even though that they, they don’t have those two items. So it’s very important that, that even through perceived issues, which can often be rather quickly fixed, there can be often a desire to overreact if something doesn’t quite go to plan these these often can be addressed in a short period of time. It’s about everyone working together like it’s a team effort, whether that’s with an external consultant, whether that’s just doing it internally or working with a third party. It’s approaching it, you know, with a good plan, with a little bit of slack, so that if things go wrong, everyone’s still on board. No one’s pointing fingers. And there’s an appropriate support network for the people that are physically doing the project because they’re the most important people.

Martin Bailey

[00.07.52]

Absolutely. That’s key in saying having that, having that support there for the people is key. Um. Generalizing slightly. Accountants don’t necessarily like change, though. Perhaps more. More reserved individuals and the change in technology even over the last 510 years. Accounting packages you could probably count on one hand the number that they were the. Kind of fixed, you know, installed on fixed desktop computers. Now there’s so much cloud based. Packages all interlinking with other systems. It’s rapidly different to systems that they would. Have trained and grown up with.

Jamie Allen

[00.08.23]

Absolutely. I mean I wouldn’t I tried not to put too much. You’re absolutely right. But from a from a bringing people on the journey perspective, it can be a fear. And obviously my goal in this is to reduce fears. So ultimately at the end of all of this we all produce balance sheets. We all do produce panels. They all do debits and credits, right? If an accounting system can’t do that, it isn’t going to be in the market, right. So yes, there are largely I mean, there might be new processes that you want to introduce, like maybe you didn’t do purchase ordering before and that’s new and that needs to be learnt and understood. So yes, if you’re adding something new, but otherwise if you’re just maintaining a status quo, they’re just different buttons. They’re probably a different color. They might be called something slightly different, but ultimately they’re all going to be performing the same tasks because the end goal stays largely the same. It’s then just a case of systematically adding layers. So going back to your question earlier, you don’t have to do everything in one go. You can deploy these things, and in certain circumstances it is sensible to deploy things at certain times. And that’s where you do come up with the minimum viable product, which is you have to be able to facilitate the core operations of a business. Sales, purchases, bank, journals, fats. If you’re VAT registered, those are like your staples, everything else. You don’t try to start from the basis of workarounds. You try to optimize from the beginning, but you have to be realistic in your approach.

Martin Bailey

[00.09.58]

Yeah, and I think for charities, resources can be scarce and the idea of changing everything in one go can be scary, but it also might be cost prohibitive. So understanding at that planning stage, whether you do something piecemeal all in one is key and it comes back to you. I know one of the things you talk about and with clients in the first period in that planning stage is why you’re doing this. What kind of approach do you take in that space?

Jamie Allen

[00.10.25]

Yeah, I mean, ultimately some of that is a sales message, because if we’re not solving a problem, no one’s going to no one’s going to want to pay me any money. But, um, but of course, you’re trying to extract a level of value. Um, and you’re also trying to help people to understand why they’re making the decisions that they’re making. Going back to what you’re talking about for about the number of applications on the market, there are a lot more applications available on the market. They’re all quite good at marketing, and they’re all very sophisticated in their sales methodology as well. Methodology. If I can get my teeth. So. You’ve. You’ve got to find the time to do the R&D on this, but also take it with a little bit of a pinch of salt in terms of they’re all going to do basic accounting. So as far as possible, you want to be looking for an application that does have some level of specialism in your industry. Right. Particularly if you’re slightly bigger, if you’re just, you know, a slightly smaller organisation, then you’ll probably be looking just largely at the market leaders. They won’t have a lot of functionality in there. You can buy apps and add ons now to handle specifics, and that may be cost effective. But if you’re getting to depending on what your strategy is, if your strategy is to grow or you’re quite a big organization, you know, and you’re on that verge where you probably need to be looking at a slightly bigger application, you should consider that, because it might be more cost effective to buy a bigger application than a small one with bolt ons. So there is there is different scenarios depending on the needs to to to find the optimal solution. And that’s that’s all we try to go in and try to talk through with people, to enable them to have the information from someone who is neutral. I don’t have a preference which application you buy or how you do it. I will make it a little bit wary of using the word recommendations, but we will certainly provide opinions on what we know works well and where we’ve seen it work well with other customers, but ultimately. If I put in the wrong application. I have an unhappy customer and that’s the value that I’m providing. So if I’m not providing that value, I’m just there’s no point in me being there. You might as well just go straight to the vendor.

Martin Bailey

[00.12.37]

I’d like to pick up on a point you mentioned about, um, understanding or using systems that are experienced in that sector or are used within, within a sector. Um, and I think in the charity space that’s important. Charities are have the need to split by restricted and unrestricted funds. They’re often reporting back to in particular grant funders, um, so needed to track their income and costs on particular projects, activities, grant funding agreements, etc.. So having that level of analysis in the system is key. The other one, other systems that are for more commercial organisations may not have that level of reporting, even for larger, more sophisticated businesses. So I think that sector sector knowledge within a system, as it is with an advisor as well and human is, is is important.

Jamie Allen

[00.13.20]

Yeah. And it’s also on top of that. You’re absolutely right. It’s only getting more complicated. Right. Whether we like it or not. Finances getting more complicated. So whether it’s, you know, you need to do source and you want something that’s going to do your sort of reporting straight off the bat that is available out there. Um, it might be that you’re looking down the road. And part of your strategy is to look more environmental reporting and ESG stuff that’s coming. So. All of this again, going back to what I was talking about is attributing a value to the items within your strategy, and then how that aligns with what you’re looking to, to do to to buy. Right. Um, based on the journey that you’re looking to go, whether it be a growth or a compliance change or whatever it might be, right. So you can always find workarounds to these kind of things. Like, we’ve all been accountants. We’ve all lived in Excel. There’s often ways to do things. But my experience is there’s often only one right way to do things. And if you’re taking data out of accounting systems, or pulling in data from various data sources to manufacture reporting in Excel, if you’re good at Excel, it may work, but you are taking a risk because you are manufacturing data. You are not working within a process. You are creating your own process. It

Martin Bailey

[00.14.50]

always raises a flag with my audit hat on. When you see people exporting the data into Excel and manipulating it, as is often the phrase used. Um, but in order to get to get, you know, such disclosures or anything else, but it’s data that’s been handled outside of an accounting system. So it just adds that additional level of risk and additional level of input by somebody that may not need to be

Jamie Allen

[00.15.10]

done. Yeah. And this is where it comes becomes even more important to make sure that you factor time elements into your return on investment when you’re also considering things and attributing a value to them. Right. So it’s not just a pure cost exercise. And this is where I think historically the perception around accounting potentially needs adjusting within your organization. And I would actually start there. If you’re looking at making change within a business, what is our perception of finance from the top to the bottom. Because what you’re doing with modern accounting system is you’re actually integrating wider operational pieces of your business. Right. Whether that’s budget holders who have to look after specific areas of the business and maintain their budgets and look at actuals, or whether it’s people who just need to do expenses in a different way, or if it’s senior members, you want to be able to go into the system, interrogate the data. Right. We have more transparent accounting systems, so it touches everyone. So before you start, what is your actual perception of finance at the top of the business? And if you just look at it as a cost. That’s a danger. Because the point of doing this is that you want to extract more value, and you have to be able to attribute a number to that and a return on investment. And that means valuing it like we are giving it value. So you have to value it. Right. If you’re just looking at this in terms of, well, I’m paying this now and I’m going to be paying this more than this because and I’m, you know, but I’m just getting a better finance department. I would say that’s not accurate. If you get the correct finance system and the correct processes and the best way of working, it will make you money, it is actually a profit generating activity. Whether that’s getting better data to make better decisions, whether that’s saving your finance, people’s time like attribute a cost to someone’s time. Like if you’re a finance professional, even if you just do, you know, back of a piece of paper mathematics. Like, what does this person cost me an hour And how much time are we looking to save from them? Performing certain activities, manual activities, normally just from an outlet. What are we going to say in doing that? That’s a tribute of value to that. If we’re saving three hours, a £40, whatever it is, right? That all has to go in. Because if you do this right, it will help you make money.

Martin Bailey

[00.17.45]

Absolutely. And I think the finance team, they partner with everybody else. They, they, they link in with the budget holders, the fundraising team, the people delivering activities because everybody has has those different skills and that different knowledge of different areas. But the finance team can help bring it together. And you’re absolutely right. If they if they have that data and can produce the information in the reports, that can help generate, you know, funding applications and generate income that can help save in costs or deliver things in a different way. So it’s a very good point that it’s often overlooked as being an income generating cost centre.

Jamie Allen

[00.18.21]

Exactly. And if you don’t have that perspective when you’re going into this. You’re not clear on your strategy. So therefore how? When you’re like delegating these activities or getting people to engage on this project and asking people to buy into what is quite a lot of change, if you’re not clear on that as your strategy and how much you value that and how it’s a good thing for a business. Why would anyone else believe in it? Indeed.

Martin Bailey

[00.18.49]

So, you know, kind of getting people to buy into change. We spoke at the beginning about, you know, the benefits of going through the change and the why you do it. But, you know, there are challenges in going through transformation program. So all common challenges do you see?

Jamie Allen

[00.19.04]

Um, engagement, which we’ve talked a lot about that is that is a typical one. Um, as I said before, the biggest variable in all of this is people. Um, and that can be from certainly a change management, which we’ve already talked about, but equally, um, from, from the perspective of learning new skills, um, and trusting the people that you’re going to work with. Like, you know, if I can meet someone tomorrow, I’ve never met me. They’re like, they’re not qualified. They potentially haven’t done this before. You know, they haven’t seen and seen the intricacies of it. It’s it’s what they do day in, day out. They’re placing a fair amount of trust in me. And also you’ve got to be able to help people to understand that their role is being redefined and not being replaced. Right. Because a typical trepidation that we will see from finance systems is, you know, we’re getting this system in a computer, doesn’t care if it’s doing 10 million transactions or one. It’s a machine. It just chugs through it. Right. So we’re going to save all this time. What am I going to do? And I think it’s a key part of this to understand that the role of the finance person doesn’t go away. Quite the opposite. It is just a redeployment or a change of role. And what we see is the change of role becomes more closely linked to an internal audit. That is effectively what you are becoming. You are becoming the owner of the company’s financial data rather than the creator of it. You are the financial control. You are the person that is now in charge of making sure that data is correct, and then someone shows up and wants to understand something, wants to know something. It’s there, you can give it and it’s done. And you’re you’re flexible and you have the ability to, to to work in an agile way, which. You know, being a finance person going back in time. Being an accountant for I don’t know, how long have I been a counselor? For 20 years now. Um, I started. Yeah. So the big changes that someone shows up under, I want this information now. And you’re like, when’s that supposed to happen? You know, like, you’re there because you’re doing a job. You have business as usual activity. Someone comes in when, like, you’re not there to sit and do nothing. If someone comes in with an extra activity, it happens in extra time. Yeah. Like so the perspective of this is that no longer has to go into extra time. You have more transparency, you have more agility, you have more ability to deliver to people the things that they actually want, which is the things that they don’t know. Yeah, right. I would say it’s quite rare that you give a business owner a balance sheet and a PNL and they go, wow, there’s something in there that I didn’t know. Yeah, like there may be bits and pieces, but they’re not going to ever go, okay, wow, that’s hit me. You know, they’re going to have a rough idea. Like most business owners will run their business by their bank account. Not the right way to do it, of course, but by and large, keep it simple. Running a big business or running a business, lots of things to think about. They will run it by their bank account. How much am I going to spend? How much have I got coming in?

Martin Bailey

[00.22.18]

And that’s often similar in the charity space because, you know, often they, you know, they there’s all the talk about reserves, but you know, often, you know, the trustees and the management team are thinking in terms of cash is, well, what cash have we got to fund our activities going through? Um, and I think maybe in the charity space you might find that, that the knowledge at board level around the balance sheets and maybe you do get more surprised within the charity space because you have people on the board from, from various different sectors.

Jamie Allen

[00.22.47]

Yeah, exactly. And they’re not qualified. They’re not finance professionals and nor, you know, it’s not a reasonable expectation for them to understand all the intricacies of it. Right.

Martin Bailey

[00.22.56]

It’s all on the ground day to day. Whereas a business owner is involved in the business. They may have found that they’re involved day to day. Your charity trustees aren’t involved on the day to day basis.

Jamie Allen

[00.23.06]

Exactly. Exactly. So certainly the goal of this is to to be able to to provide value to ultimately the people who are appraising you, you know, in the in the reality of this, at the end of the year, when you sit down and have your appraisal, you’re going to sit down with these people. They want to be able to have that exchange with you as the head of finance and say, you’re giving me everything that I hope for. And that is often actually the tricky stage of going back to what we’re talking about before. Like, what are the the, you know, some of the risks and what are some of the difficulties that we face in this is that. The understanding that. That it’s not. It’s not a personal thing. This it’s a business strategy thing and it’s and it’s a development thing. And typically where it can be difficult for a finance controller as they say. You know, this is a reflection that I’m not doing well enough. It’s not. It’s not a reflection of you as an individual. It’s just the case that there is a change that potentially needs to happen in the business to to enable it to move in a new strategic direction. That will be for the benefit of everyone. And I think that’s that’s the mentality. And going back to engaging with the senior leadership team and the messaging and and all these things is to make sure that there is calm and understanding and a vision of where we’re going in this and an understanding of the people who are doing it, what their role is going to be, and that they’re comfortable with that. Yeah.

Martin Bailey

[00.24.39]

And I think often charities are to an extent maybe a better place than that. The churches are really quite resilient and have to be very adaptable to change. You know, we mentioned at the beginning with Covid, you know, activities all of a sudden being done remotely or fundraising in-person fundraising events, stopping overnight and having to look at new ways to fundraise, new ways to carry out activities. I think the charity sector’s quite used to having to be flexible and adapt to change. But that can feed, you know. That’s absolutely right that that needs to flow down into the into the finance team as well.

 Jamie Allen

[00.25.10]

It’s the setting up for success. I mean, even in the example you’re talking about, all of those things are human things. They’re not like technology as a tool. It is there to facilitate you to be able to do the things that you want to do. Right. Whether whether you’re using a, you know, an accounting piece of software or a car to get you to work quicker, it’s the same analogy, right? You’re just using a piece of technology, whether it’s a car or a finance team, to facilitate the best journey. Right. So. All of these things. These decisions are made by humans, like someone who’s giving you funding. They are making a decision that they trust you to give you that money. Right. And in the same way as a as a person who maybe is running that charity and saying, well, I want this funding, they are trusting you as the incumbent of their finance team to facilitate them to look good in front of this person and say, right, you want that information? We’ve got it bang done. We’re a proper professional outfit. We’ve nailed this. Here it is. Go. Now, isn’t that going to create a much more positive experience for everyone? Absolutely. Then, then oh, let me come back to you and let’s have timely information? Okay. Well, yeah. You know, give me a couple of weeks to go in and, you know, get the spreadsheets out and work it out. It’s, it’s having that that data there. And then it just demonstrates that you understand your organisation, what you’re doing, how you’re funded, how you’re working. It just shows that depth of knowledge there. It’s just making the journey more enjoyable for every single stakeholder. And as I said, going back to before that can only make your business more profitable, particularly in the charity sector when you’re going after funding.

Martin Bailey

[00.26.50]

So, Jamie, we’ve spoken about the people’s side of of transformation projects so far, but there’s also the system side of things and the process side of things as well. So maybe you could just touch on that element.

Jamie Allen

[00.27.02]

Yeah of course. I’m here to talk about digital transformation. So it probably makes a bit of sense to talk specifically about the technology perspective. So um, we’ve spoken a little bit about new entrants to the markets. And there are a few. What I would say is that if you’re looking at the the industry make up, like how it’s structured at the moment, you have SME products, you have this new area which is called the mid-market. They’re all fairly, fairly new in the last few years. And then you have, um, the slightly larger ERP, um, the Oracle’s of this world and SAP’s and so on and so forth. So you have very much a three tiered, um, uh. Set up at the moment in the accounting technology section. So there will be a lot of different theories on this, and it is largely opinion based, but this is from my experience. You can achieve a lot with SME products at the moment, and you use Boltons and apps to be able to achieve those to handle specific problems. And it’s a very, very good way of approaching it depending on your organisation, because what it enables you to do is not buy a product which comes at a particular price, normally quite a high one for a number of modules that you’re not going to use, right? So it gives you a little bit more of this pick and mix, plug and play perspective. Almost like imagine on your mobile phone. Like don’t download every app in the app store. You pick the ones that you want and you you use. You probably have about 50 and use about five of them, but that shouldn’t be the way you don’t need them on your phone. You could be deleting them, right? And it doesn’t often cost you anything, right? But if you are buying a bigger application, you are going to have modules and paying for things potentially that you’re not going to use, right? However, if you are buying five applications, potentially to do one thing, each of those applications is going to have their own margin involved in them. It is potentially going to cost you more money depending on which applications you buy and their pricing mechanism. And you are a lot like if an integration between each of those applications doesn’t work, that’s your problem. Like, you are never going to get two vendors to to to particularly engage with you if there’s an integration issue, because ultimately they’re doing it for free and they’re going to look at it from a commercial perspective. How many users are using this integration? Is it 100 or 100,000? If it’s 100, you’re going to go into a queue and you’re that’s your problem, right? So, you know, that’s just down to the vendors that you’re working with. Working with market leaders. Does that work from a pricing perspective. But if you’re just working with market, it might be that you’re going to spend more money than just going a step up into the mid market applications.

Martin Bailey

[00.29.48]

So a pro of that kind of plug and play approach though is that you said, you know, you might have five things at five different apps that go into it. Four might work really well that you want to keep longer term. Something might happen down the road. You maybe don’t need number five. You need to change it. It’s often a bit simpler than to swap out that one, rather than if you’ve got one system that’s doing everything. It’s harder than to…

Jamie Allen

[00.30.09]

Yeah, I mean, a system is only as good as its weakest part. And I mean, that’s not necessarily true,  but if you’ve got it’s it’s never going to go away. And ultimately if you’re buying a bigger application, you’re doing that because you want the integration problem to go away because they they have to make it work because it’s all under one brand and it’s all one system. So, you know, there is a cost impact to it. But there’s also an ownership of of, of, of issues that goes away, you know. Um, so yes, it’s more interchangeable. Yes, it’s more flexible. It can be more expensive. Um, and it will be down to the individual scenario, whether that is the right way to go or the wrong way to go. What you do find with people, and this is where what I would say, not just from the technology perspective, but from a consultancy perspective, and you will see a lot of people on social media who say you can use zero for any size of customer. Not not a message I would totally agree with. You can get good companies on zero. Often it’s down to transaction volumes. Not not the size of the transaction. Like if you’ve got one transaction that’s like £20 million, that’s not creating a load on your accounting system. It’s like high, high volumes, right of of individual transactions. Can those be batched together to reduce the stress on your accounting system? Possibly as long as it doesn’t damage your reporting perspective. Right. You’ve always got to think of this. What is going to be the next question? If you’re batching transactions together and making your accounting system leaner, you are losing that granularity of information. So if someone comes in and says, don’t like that number, you’ve then got to go somewhere else to find that that out. And that is time and that is cost. So so you’ve got to take an objective perspective to this. Yes, you can go and get a simpler accounting system that may be potentially what a head of finance wants. They like. Not everyone loves complicated. Yeah. All right. So you’ve got to balance out all these different factors and and and approach these things pragmatically from a cost perspective, from an ownership of integration perspectives, which you are going to want if you’re going for an SME product. And even in a mid-market product, if you’re using funding platforms like you might be using some of the donation platforms out there, right? No accounting system is going to do donations. So, you know, always look at what you’re using in your business already operationally and what cannot change. What are the limiting factors in approaching this. And then look for the accounting systems, the niche in your sector preferably, and that have existed as a result of niching in your sector and having a bigger client base in that sector, they should be more willing to build integrations into donation platforms or whatever you’re using to facilitate future success in that sector. Because they are they are more inclined to do something. So it’s about positioning yourself. Um, it’s also about getting the right consultants with experience of putting that product in. Right. You can get generic consultants, but. Why would you? If you can go out and you can find someone who’s put that product in before, and the vendors should help you as well. But I wouldn’t underestimate the value of having someone approaching it from your organization’s perspective with experience, rather than just relying on a vendor, because a vendor will want to approach it from a more off the shelf perspective in terms of they want to have a project plan, which is repetitive across all of their customers because it’s more efficient for them to do so. So as a result of that, they’re going to look for things that are repetitive. So anything that is individual to you from a sales perspective, they will of course say, yes, we will do that to get you to sign a contract. Salespeople will do that. Hopefully they have the integrity to to to communicate that. It’s not as easy as sometimes that they can make out to be. But why? Why? Like always, I would always encourage you to have someone within your organization on a part time basis, potentially, who has experience of putting that product in and can maybe see through some of the sales messages and actually highlight potentially where the complexities are going to be so that those get front-loaded. Because otherwise all that’s going to happen is you’re going to get knee deep into a project and then they’re going to go, we can do it as we said, we can do it. But actually doing it is maybe not so straightforward.

Martin Bailey

[00.35.08]

I think having that independent pair of eyes across it is useful, as you say, a vendor, it might be more likely to say, well, we can make our product work for you in this way, whereas is that actually… 100% right for the organisation in the first place. There might be different solutions, and I think that’s where where you and your team come in. And having that that wider viewpoint across different platforms, different systems, different organisations, you can just draw on that experience from different different areas.

Jamie Allen

[00.35.37]

Exactly. And and it’s you know, the temptation with a lot of vendors can be it’s in the development plan. It’s like, okay, you’re very rarely pinned them to a date. Um, and things may or may not happen. So I would always probably steer away from anything that says it’s part of a development plan. If it’s not there, it’s not there. You can’t. I’ve seen too many promises of functionality over the years to, to to to hold too much weight on that. Right. So if it’s not there, take care that it’s not going to be there for a little while. Right. Um, because these things can change, right? And once you’ve signed, you’ve signed. Right. So. Going back to what we were talking about and where where you’re where your point is. Absolutely, yes. Look at the experience. But what you’ll also find with certainly consultants where we feel that we’re a little bit different. Not not to talk too much about us, but we do multiple vendors. Often you will find that someone just does zero or just does a sage product. They might do two sage products okay, but they are a sage reseller, or they’re a NetSuite reseller or a Microsoft Business Central. So they will do one thing. So it’s a bit like going to buy a car, right? If you’re going into a Honda garage, would you ask them to provide an opinion on every single car that’s on the market? And theirs is definitely the best compared to every other car on the market? Yeah, no, I don’t think they would be able to give an objective opinion, right. So yes, I mean we can’t do every application. And do I know everything about every single application out there? No, it’s impossible. But a lot of the challenges in finance repeats. So procurement is largely the same in one application that does it. That or another. We’re not we’re not completely reinventing the wheel. Right. If you’re posting a journal, it’s largely the same in one accounting application to another. Same with the purchase invoice. Same with scanning. Same with all these things. It’s more about functions than it is about specific ways of doing things. It’s what are the tick box functions that we need and what have we got already in the business that we cannot change, whether it’s funding platform or we collect things via direct debit and we work with PayPal or stripe or whatever it might be, that ain’t going to change because it’s just not on the table. It has too much of an impact on our business. So. Make sure that you’ve got those limiting factors. Make sure you understand the volumes that you’re looking to to go at. Make sure the entire financial system ecosystem is made up, but it is made out and drawn out for you, and you understand it and then present yourself with, I would say, three options, or someone else someone can do it for you. We do it for people. There are other people out there that also do that kind of digital advisory piece. Make an informed decision. Pick the platform that’s right for you. Make sure that you’ve resourced it internally correctly with someone, hopefully with a bit of experience. Make sure you’ve got a good project plan that has a certain amount of slack. Don’t make sure people are going on holiday. You know when the sun’s out or it’s a Christmas. Do it at a sensible time. Don’t necessarily focus on year end, although it can help. Um, but modern one file systems can work around year ends. Um, you know, is January necessarily the right time to be doing a finance transformation project or, I mean, with some of the charities they have year ends in like April or August with an education centre? Yeah. Are people going to want to do it in September when they come straight back? Ask yourself those questions maybe. Right. Um. But certainly. Getting the technology right. Make sure you’ve taken those three options. Consider it from a human perspective as well. So some products completely configurable. Turn on turn off. Don’t need a lot of sophistication to run those. Just need to make sure the integrations work. Mid-market you’ll have less integrations, bigger systems, a lot more configurable. You will need someone with a decent level of technology skill to maintain those applications. Um, they’re not so straightforward. There’s a lot of buttons you need to understand them. There is what I would say half way to being what we’ve historically, historically called a systems accountant. You’re about halfway. So you’ve got to have someone in your business who can manage that. If you’re going full ERP, if you need to. And and I would say with the mid-market applications, there is less need to because those mid-market ones weren’t around. So accounts like you illicit x ledger sage intact. They are the new cloud mid-market offerings. They’ve all sort of appeared in the last five, ten years I would say. So. Pick which one you like. Make. Make sure you get what you want. Above that, you may go and get Microsoft Business Central or Oracle NetSuite in particular for a similar price point to the mid-market ones. But what they won’t tell you is if they do updates because you can code in it, you are responsible for those updates. So if they do an update and it messes around with some of your coding, is your problem. Okay. Which is where the cost comes in with the LP is you often need a full time systems accountant, and that it’s not actually the technology that costs you with a big ERP, it’s the sophisticated humans to manage it for you. So just understand the decision that you’re making from a technology perspective. Okay.

Martin Bailey

[00.41.31]

Fascinating stuff. I think the the key bits for me of all of this is make sure you have that project plan. So make sure you understand what you want. Want to get out of out of it. Make sure you’re engaging with everybody in the business, making sure you’ve got somebody kind of overseeing the project that hopefully has some knowledge internally of implementation. But getting that buy in from the different, the different people within it. And I think the third thing is just making sure that you’ve got that system and you pick the right system there to do it.

So thank you very much, Jamie. That was a fascinating discussion around digital transformation projects. I hope you found that useful. And if you are thinking of undertaking a digital transformation project yourself, and please do get in touch. Thank you very much.