A growing business enters new geographic markets. It acquires companies. It launches new products. And that means finance needs multiple dimensions of scalability.
In most IT contexts, ‘scalability' implies size - transactional scalability - but with the cloud, we should consider the importance of functional scalability as well. After all, a thriving business sees growth not only in transaction volumes, but also the diversity and complexity of the transactions it processes.
These considerations affect the choices we make with cloud computing architectures. As I explained in a previous post, not all clouds are the same. Perhaps the biggest distinction revolves around multi-tenancy and dedicated (also known as 'one-off') systems. On dedicated installed systems, you face a never-ending cycle of service queues whenever you want to make changes (which, again, growing businesses will require). As you work to scale your business, you can be hamstrung by the limitations of systems that require manual updates. By contrast, multi-tenancy architectures serve limitless clients on a single code base. This ‘true cloud' makes clients self-sufficient through scaling functionality.
Scaling your functionality
When you're trying to scale up your financial system to meet the needs of your growing business, the last thing you want is to see a parade of expensive consultants, create complex testing environments, and endure lengthy upgrade cycles. But systems that reside on a local server or on virtual servers (on a dedicated, per-client basis) usually mean you're forced to wait your turn before you see any updates. What's more, those updates can be highly disruptive to your business.
With a multi-tenancy architecture, your updates - including transactional and functional improvements - are handled by the vendor and are ready to use immediately. In many instances, you can access previews and learn about new features in the weeks before the update occurs, so you're prepared before the cutover takes place to choose which new features you intend to exploit.
Customizations that you control
But what about customizations? Previously, the custom modifications you make to a commercial software package were tremendously difficult to maintain as you upgrade to new versions of software - so difficult that many companies preferred to skip upgrades and updates to avoid the disruptions, time, and expense.
It's different with true cloud architectures, which support the unique requirements of each customer on a single code base by providing customization tools within their software solutions. Common customizations, configurations, and preferences (e.g. screen layouts or informational messages) are often a menu-driven, self-service proposition. More advanced customizations are created through simple scripting languages. Some systems, like Sage Intacct, let you create entire applications connected into the finance system.
For instance, you could create customized data validations, email stakeholders when certain events occur, or build custom reports. Those modifications move forward - automatically - in a true, multi-tenancy cloud architecture when new versions are rolled out.
By making customization a self-service activity, you're able to adjust the system to individual needs without waiting in a queue at a service center. More importantly, added functionality from an update won't disrupt your finance system or your business. Customizations roll forward with you as you upgrade - without breaking.
Integrations for best-in-class results
Another crucial way for a financial system to scale up with your business is through smart integration with other systems, such as payroll or CRM or even specialized sales-tax calculation systems. True cloud companies support best-in-class assembly of integrated systems through open APIs that connect easily and transparently with external systems. For instance, you might want to run a sales order workflow that starts in CRM and ends in the financial system, so each system works with synchronized, updated information. Of course, this doesn't eliminate the need for integration testing - but it reduces those tasks from a resource sinkhole to a planned activity.
Across each of these dimensions, a finance system should provide the flexibility a growing business needs - accommodating new capabilities, essential customizations and connections to other systems. As you contemplate your upcoming growth, be sure to look beyond transactional scalability and assess your finance system's functional scalability as well.