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How To Evaluate Practice Management Software

Carl Coe
Posted by Carl Coe on Aug 10, 2021 12:56:34 PM

Practice management software can be a valuable tool to guide your firm to profitability. If you choose the wrong solution, however, it can set your firm back in both time and money invested. The process of shopping for a new software suite can seem daunting to a small firm owner. But it doesn’t need to be that way if you know how to evaluate your options.

What is Practice Management Software?

Practice Management Software is an enterprise-wide software solution that automates and organizes many workflows of an accounting firm. It can replace many of the tasks your firm may have been doing manually. A few examples of these processes include:

  • Sending proposals to prospective clients
  • Invoicing clients and processing payments
  • Storing and organizing important client documents
  • Tracking employee time
  • Integrating data across the company to provide detailed reports
  • And many more...

There are many practice management solutions out there. Some are great at a couple of things, like project management only. Others provide a more all-in-one solution with every major company function included. For this reason, many small firm owners can get overwhelmed at all the options and never end up finding the appropriate solution for them. Thankfully, there are some great all-in-one practice management software specifically for accountants out there that can make it much easier to run your business.

Below are some suggestions for how to evaluate these options and find the right one for you.

Tip #1: Choose a Software That Your Employees and Clients Will Adopt

The worst-case scenario for transitioning to a new software package is that your employees hate it, and clients don’t use it. You have spent a lot of money and time implementing the software, and you need to turn around and shop for another solution twelve months later when the subscription runs out. To ensure this does not happen, it is crucial that there will be buy-in, first from your employees and then from your clients.

For employees, the software should not have any extra prompts or hoops to jump through in order to complete their work. Logging in from different devices should be simple. The user interface should be clean and easy to navigate. It’s our job as leaders to demonstrate how this tool will make it easier to do their job even better.

For clients, the software should make it easy to provide you with the information you need. Tasks like uploading documents and making payments on invoices should be straightforward and fast. While many products feature a ‘client portal’, many clients dislike it because it is another login to remember and screens to navigate. Instead, allowing clients to access files via an emailed direct link makes their lives easier. Many vendors don’t offer this feature, but this one aspect alone can increase adoption, reduce support calls, and improve overall client satisfaction.

Tip #2: Make Sure the Software Has Everything You Need

Many vendors claim to have an all-in-one solution but instead offer just a few modules that need to be integrated with other tools. They give the illusion of an ‘all in one’ package but create just as much (or more) work. If you need support, you will also have multiple people in different companies to contact.

Instead, try to seek out integrated software solutions that can seamlessly connect all your core company functions in a single place. This includes:

  • Customer Relationship Manager (CRM)
  • Due Date Manager / Project Management
  • Time tracking
  • Billing
  • Document Management / Secure File Sharing
  • Customer Portal
  • E-Signature

There are two primary advantages to all-in-one solutions:

1. Data moves effortlessly from one module to the next, which saves valuable time for your employees. Instead of having 5 different apps and 7 browser windows open, you just need 1.

2. You only have one vendor to call when you need help, which makes resolving issues much easier.

Tip #3: Ask Yourself… Will This Setup Provide Me Better Reporting to Manage My Business?

A ton of good data can be accumulated when tasks like time tracking and billing are unified by one central database. This data can and should be leveraged to give leadership insights into how the firm is performing that would be time-consuming or impossible with less integrated tools. It is important to find out the reporting capabilities of each software package you evaluate. A good rule of thumb is that it should provide more detailed reporting than your current solution while making it easier to access and visualize that information.

Tip #4: Ask Yourself… Will the Benefits the Software Provides Outweigh the Costs?

Practice management software packages can be a significant investment. However, the costs of the right software solution will return to you many times over if utilized properly. It’s important to think more about the ROI a potential software will provide than simply the price tag. One helpful way of thinking about an investment like this is to ask the question: “How much time per week will this application free up?” If it allows you to reduce costs and increase productivity by more than you invest, then you’re on the right track.

Tip #5: Ask About the Implementation Process

As mentioned earlier, ‘buy-in’ by employees is crucial. A key to company-wide adoption is making sure the implementation process is as pain-free as possible. Vendors should offer training sessions for the software that are focused and short-term. Ideally, they may also provide onboarding services that will make it easy to migrate your data into the new system. If employees need to self-service through training documents and complete lengthy user acceptance training, adoption will be frustrating and time-consuming.

Additionally, the implementation demands need to align with your firm’s schedule. If employees are working overtime because implementation is pushing off their client work, morale will suffer. Granted, any big change like this will take time and energy. There’s no way around that. But try to get a sense of how committed your vendor is to simplifying and streamlining this service, and you’ll save yourself -- and your team -- a lot of headaches.

Other Considerations

  • Technical Support Accessibility: Will I be able to reach someone who can help resolve my issues? Are they located in the US or off-shore?
  • Data Migration: How easy is it to import and export data to and from the platform?
  • Integration with other applications, such as tax software

Selecting a good practice management software for your accounting firm can certainly feel overwhelming. As laid out above, there are many variables to consider. However, knowing what you need, and what to ask for, is key. If you and your partners use the above evaluation tips, it will help simplify the selection process. Then you can avoid getting stuck with the wrong tool and instead focus on what the tool is supposed to do in the first place: improving your firm's efficiency and profitability.

Topics: Practice Management


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