Business owners have a lot of things to consider to ensure that their venture succeeds. It has to reach a global audience, have reliable production mechanisms, and adopt top-notch technology to stay ahead of its competitors and catch up with the growing market.
One primary criterion of business success is how well it handles its data. Accurate, updated, comprehensive, and secured data management systems are non-negotiable for businesses that aim to grow. This is particularly important for small and mid-size enterprises (SMEs) targeting commercial stability and initial expansions.
Accounting is one of the industries so keen on adopting a more secure data management system. These systems perform a range of business functions you can streamline in one comprehensive virtual space that’s only accessible to authorized users. This is called ‘cloud accounting’ or ‘cloud computing.’
Cloud accounting systems are excelling at handling tedious, repetitive tasks that would otherwise be executed manually and consume a significant amount of an accountant’s time. These systems target some of the common SME operational problems and entrepreneurial pain points, such as lack of inter-organization collaboration and hefty IT costs, all while delivering innovative features.
Here are five reasons why you should consider adopting cloud accounting technology.
5 Ways Cloud Accounting Can Improve SMEs
· Improves financial accuracy leading to perceptive decision-making
SMEs often make business decisions regularly, usually anchored on data. Big or small, these decisions can shape the entire business, and when traced back, it all comes down to the set of data on hand.
According to a survey, 75.7% of business owners remain in manual accounting labor, resulting in data-entry issues. These issues include poor operational choices, reputational harm, economic loss, penalties, fines, legal action, and even bankruptcy.
Cloud accounting eliminates the risk of inaccurate data entry, allowing you to devise decisions that effectively identify gaps. For instance, a bank can link to a cloud accounting system for automated bank statement generation and encoding to instantly see any possible concerns about transparency.
· Secures data storage
The majority of data breach cases are financially-motivated. On top of this, data loss is another data management concern that may arise with using physical data storage, such as paper and flash drives.
Cloud accounting resolves these concerns through foolproof security walls and multiple backup servers. Since cloud accounting operates virtually, transferring and organizing data becomes more manageable.
· Produces relevant outcomes through efficient and collaborative work
Cloud accounting’s simple yet efficient processes create a collaborative environment that increases employee performance and grants a more mobile setup.
Though an intimidating concept at first, cloud accounting systems are user-friendly. Developers formulated it for employees who are not tech-savvy. As such, you can acquire technical support and expert guidance to help train your employees to navigate cloud accounting systems. All operations are within one vast database that allows
- simultaneous work,
- real-time communication and updating,
- spot-on corrective evaluation,
- prevention of work duplication and back-and-forth emails, and
- remote work with database access.
Stuart Watson of Sage perfectly captured this point, saying, “you’re all working from one single source of truth. This way, everybody can coordinate their efforts from wherever they happen to be at the time, with the same level of efficiency as if they were all in the same room together.”
Both relational and human capital have a significantly positive relationship with cloud accounting. This suggests that cloud accounting has improved job performance, teamwork, and knowledge creation among your staff. The vital relationship in relational capital is that cloud accounting allows your business to acquire and use stakeholder information more efficiently.
· Operates on flexible costing
Businesses typically acquire cloud accounting systems through subscriptions that they can upgrade or cancel anytime. With no ties to a contract, these systems capitalize on positive user experience. This is why SMEs should embrace cloud accounting for resource generation and operational expansion.
A growing customer base, additional third-party operations, or an identified concern may require upgrading your business’ current plan. Thus, you can optimize your system to what you need at a given time and invest in upgrades only when necessary. In addition, unlike desktop software, cloud accounting is systematically updated without installing update packages.
Aside from its inherent cost-efficiency, cloud accounting cuts high operational costs, including IT support technicians, power usage, physical hardware, and storage space. You can use the money you save from installing cloud computing for more critical aspects of the business, like marketing efforts, business development, and employee training.
- Streamlines all necessary operations
Cloud accounting becomes a single virtual space for business operations that can set a network of interlinked processes for faster and more efficient delivery of outputs, such as:
- Digital banking
- Payroll and invoicing
- Procurement and inventory management
- Human resource management
- Customer relationship management (CRM) software
- Communications
For instance, you can drive marketing analytics data from the CRM to the marketing team or allow the HR team to access accounting data to generate employee incentives. From start to end, this operations matrix happens in one virtual space to which relevant users have access.
Cloud Accounting For Your Business
Cloud accounting can help your business identify pain points, but that’s not to say it’s terrible. Perhaps the only drawback here is that SMEs who have not integrated cloud accounting technology into their business operations are missing out on more efficient accounting procedures.
No matter what industry your company operates in, cloud accounting can accomplish more of what interests you and elevate your business’ financial management. The most effective resource management and accurate accounting will take center stage as your corporation grows, even though they may appear to be secondary in the early stages of a new enterprise.
If your company has already reached that point and you need accounting professionals to step up your finance management, search for companies that offer expert accounting services for small enterprises. Additionally, choose a reputable company that will enable you to get the most out of your cloud accounting software.
Cloud accounting ensures data accuracy and security, improves workforce productivity and task delivery, and allows collaborative and remote work for flexible costing. These should be enough to convince you to adopt cloud accounting technology and see a leap of improvement from how things were to how things can be in your business.
