Keeping Your Financials Intacct
Financial and accounting applications are the backbones to every business -- not surprising considering the key to staying in business is making money. A $43 billion market, financial applications software is the largest software category, explains Dan Druker, senior vice president of marketing at Intacct. Moreover, he says, "it's the most mature software because every company needs it." With the Winter 2009 launch, Intacct aims to enable global business management with Intacct Global Consolidation; a three-way integration connecting Intacct Max with its largest partner, Salesforce.com, and professional services application QuickArrow; and a less expensive and simplified user interface to ease customer migration off QuickBooks and onto Intacct.
While there are additional solutions that are viewed as highly sophisticated -- such as Peachtree by Sage or Microsoft Dynamics GP (formerly known as Great Plains) -- analysts note that Intacct differs from these simply due to its software-as-a-service (SaaS) delivery model. "At some point, everyone butts up against that decision: 'Packaged or SaaS?' " says Laurie McCabe, a partner at consultancy Hurwitz & Associates. "Whether you're going with NetSuite or Intacct, you're probably going to pay less [on] subscription-based software than to renew the license and pay the maintenance." And in this economy, McCabe says, saving money's always an appealing value proposition. "By and large, any of the SaaS players that have gotten some wind under their sails are probably going to be aided by this economy."
Its in the cloud competitor NetSuite offers an integrated enterprise resource planning suite, whereas Intacct focuses strictly on remaining a best-of-breed finance and accounting application. "You're probably never going to get to a definitive agreement on whether best-of-breed or an integrated suite is the best way to go," McCabe says. Best-of-breed does have its advantages, she says, especially when a company isn't ready to go the whole nine yards. "Financials...is the first true business type of application that a company's going to buy," McCabe says. "Everything has to tie into that."
As an on-demand application, Intacct Global Consolidations makes it possible for users to log into any location to enable a complete view of the entire enterprise in real-time. For companies that are, say, headquartered in the United States, have sales in Europe, development in India, there are separate accounting and tax laws depending on the region to abide by as well as multiple currencies to deal with, Druker explains. With Intacct Global Consolidations, the chief financial officer can achieve a comprehensive view and perform reporting and analytics based on numbers from the entire enterprise. From a business perspective, Druker says, this is highly beneficial when the CFO in the U.S. wants to understand how the business is doing in American dollars, and then, at the click of a button, convert everything to the Japanese Yen, enabling him to have a conversation with his Japanese counterpart in familiar terms.
In the past, the branch in India may have receipts filed in drawers, the one in Australia may be operating on QuickBooks, and the one in France is running a homegrown program. Because every system is now connected by a single on demand software, the company can make queries such as, "Show me my top 100 customers around the world that owe the most amount of money," Druker says. "You couldn't ever do that before."
For the last year and a half, Intacct has enjoyed a strong relationship with Salesforce.com, with 60 percent of its business joint with the software-as-a-service giant. "My ideal prospect," Druker says, "will be using Salesforce for CRM [and] loves the SaaS model." Certainly, customers using Salesforce.com have already seen SaaS at work -- in addition, they'll likely not want to consider revamping their systems and opting for NetSuite. Nevertheless, McCabe notes that, "If you're starting from scratch, you may just want to go with integrated suite right out the gate."
According to Intacct executives and the company's marketing materials, the plan is to be "channel- and partner-friendly," as part of an overall effort to facilitate an "on-demand ecosystem" with other best-of-breed business applications in sales, marketing, or any other business unit.
McCabe does warn, however, that Intacct should take caution against being overly reliant on Salesforce.com. The larger, older vendor, she says, "is a great partner, [with a] lot of momentum, but [Intacct] needs to establish a stronger identity on [its] own in the market," she says. "Not too many people have heard of them and I don't think they should rely on Salesforce to get the message out."
The Winter 2009 announcement also introduces Intacct MAX for QuickArrow, an on demand software for professional services, which to completes a "trifecta" with Salesfroce, Druker says. The process, he says, can operate as follows: The sales team will use Salesforce.com to sell a product or service. QuickArrow manages tasks such as, who's involved, who's assigned to what duty, whether the project is on schedule, and how to capture time and expenses. Finally, Intacct provides the financial aspect underneath to ensure people are getting paid, the customer is getting billed, and that ultimately, to understand if the project is profitable.
Druker estimates that five million companies in North America are using Intuit's QuickBooks. "It's a great product and so inexpensive," he says. But because of that, "companies stay on it way longer than they should. It's an entry-level product." Intacct targets midmarket enterprises with employees ranging from 25 to 1,000. When companies grow to be between 25 and 50 employees, managing an audit trail and protecting against fraud becomes more difficult, Druker says. As a result, financials are often managed by more than just the business owner and in turn, a more sophisticated solution. To ease the migration, Intacct has simplified its user interface to look more like QuickBooks. The company has also reduced entry-level prices for small businesses from a monthly fee for $400, down 50 percent from nine months ago. In addition, what once was a $10,000 migration, can now be managed through Intuit partners for less than $2,000, Druker says.
If and when the larger vendors like Microsoft and Sage ever produce an on demand accounting solution, Intacct may have serious competition. As the market stands, however, this development "hasn't materialized at all," McCabe says, noting that going on demand won't be easy, considering "SAP's had a lot of problems with Business ByDesign," its solution intended for the midmarket.
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