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IT Chapter Newsletter May 2008 Edition

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Welcome to the May edition of the IT newsletter

Issue No 02 /2008

27 May

	1. Managing change
	2. Achieving the paperless office
	3. Project evaluation
	4. Further reading and references

Managing change

One of the most critical steps to ensure the successful implementation of new tools into an organisation is understanding the change process. Who better to provide tips for success than someone who is involved in implementing software for many different companies. In this article, Jacquie Strudwick shares her experiences and tips for achieving success.

The resistance to change in accounting firms is extremely strong. Some firms are still conducting business the same way they did 15-20 years ago. Many firms do not even consider that new technology is available, which would assist them, in achieving outputs that they could not even perceive in the past.

When we made the leap from manual typing of tax returns with carbon paper to the computer generated front covers, the next great leap was the electronic lodgement and we got through it all without mass retrenchments of staff or the world ending. Even with workloads and competition increasing, firms have undergone change without any permanent damage or loss of jobs.

Firms have implemented new technology over the years, most recently an uptake in new practice management systems, knowledge management and document management systems being added to a firm's software stable with varying results. These results do not vary because one firm picks a better supplier than another, these results vary as do the degrees of failure and amount of dissatisfaction as a result of no-one managing the process of the internal implementation.

When you take on a new application, a decision has been made; the supplier arrives, installs, configures and trains your team on the use of the new application. The implementation continues long after the supplier's team have left the building. Your team members had a full time role before the new application was installed, the implementation and training has added to their existing workload and the ongoing internal implementation tasks become an additional burden.

What happens next? The team take the path of least resistance, the one they know to get the task completed, the way they know how, even if it is not the quickest, it is familiar, it is the more comfortable road for a team member with an increased workload to take.

The end result of this is that the new systems are not utilised and the ongoing implementation tasks keep blowing out, until the team are able to create a block of time to re-familiarise themselves on where they were in the implementation process, and recommence the internal implementation. This cycle continues in some cases for years, with no end result, only unhappy clients who blame the software they selected for their woes.

As you are nodding your head after reading the above, or being reminded of such a situation in your own firm or company - all is not lost - there are steps that can be taken to ensure that you do not experience this in the future.

Your team consists of professional, bookkeeping and administration and they are there to support the partners, directors and management, however if your team are not empowered to manage their workload and the firm, the burden falls to you. It is amazing that firms will hire staff who they do not want to communicate with clients without every email and letter being checked at the highest level. Your team are on the same side as you and can be empowered to service your clients. The team can provide the service if they are trained and know the boundaries within which they may work and service your clients.

Effective delegation requires a process to be in place that is consistent and adhered to at all levels, with checks and balances in place along the way to ensure quality control. Delegation then clears the way for partners, directors and management to focus specifically on servicing clients passing administration tasks such as scanning, filing, letter creation, follow up of documents from clients, follow up of missing information from clients, calling of clients to bring in work and overall workflow management to the administration team.

The administration team already have a heavy workload and the ratio of administration to professional staff has reduced over the last decade, in many cases, to less than 1:3. There is no capacity within administration to manage these new tasks. So it is necessary to look at the processes that are currently in place for performing administrative tasks.

Partners, directors and management are rarely involved in the day to day document production and management function, as you deal with the end result. For example an assessment with a covering letter arrives on your desk for signature, you may not be aware of the 12 step, 10 minute journey that the document has been on prior to arrival in your in tray for signing.

The administration team follows the path of least resistance, the road well travelled that they are comfortable with and upon asking questions about these processes it becomes immediately apparent that this process was not born out of best practice it has simply evolved as mistakes have been made along the way and new technologies on offer have not been integrated to increase efficiency.

Below is an example of the steps used to create an assessment letter:

Open mail, check in tax software and enter assessment number, payable date, open word document and cut and paste address details from practice management system, edit each letter to reflect correct wording for payable, refund or nil balance, print two copies of the letter, photocopy or scan assessment and send for signature, finally sometime in the next week or so files the file copy into the clients paper file.

The above process can take at firms to take anything from eight to 18 minutes per assessment. In the majority of firms this process is not charged to the time sheet and instead is absorbed as an overhead. If a firm handles 1000 tax returns, they process on average 5000 pieces of Australian Tax Office (ATO) correspondence on behalf of those 1000 tax returns per annum, times that by five minutes that totals over 400 hours, of administration time, so now start to think what else could be achieved in that time frame?

There is technology available to totally automate this process without compromising the firm's quality control and decrease the time taken to provide this service to clients. Firms that have implemented this technology have been able to reduce the processing time to less than 10 seconds per document. This then frees up the administration team to take on other tasks as suggested previously and partners, directors and management are able to undertake more high value face to face clients work.

The implementation of automated scanning, letter production and filing technology enables the stream lining of essential, although low value work, and frees up your administration team enabling a focused implementation of new technologies such as practice, knowledge and document management.

Finally talk to your peers, suppliers reference sites and clients. The reason for this is that another firm has been on the journey you are about to make and overwhelmingly they are happy to share their experiences, as special as your situation and set up may seem, you will be surprised to discover that many have jumped that hurdle before you.

Jacquie Strudwick is National Sales and Marketing Manager with Best Practice Solutions. For more information contact Jacquie or visit the website www.bpsonline.com.au

Achieving the paperless office

All accounting firms are looking for ways to improve their efficiency in what is a traditional paper-based industry. With a plethora of tools and technologies available in the marketplace, the trick is selecting the ones that will work best for your company. Judith Merryweather provides an overview of some of the considerations for anyone embarking on projects to achieve the "paperless office".

Technologies

There are many technologies that lay claim to solving the paper problems for companies. Many of these technologies have been around a long time. They do offer improvements to work practices and can reduce the volume of paper that is produced and used. So what are some of the more common ones being introduced into accounting firms? Do they work? What are some of the tips and tricks to look out for?

Scanning

The first step to a paperless office is to be able to capture the paper that still exists so that it can be accessed along-side all newly created electronic documents. Having all required documents, both old and new, in one place is a way of gaining acceptance to the whole process. This means you need to decide upon a strategy for existing paper files especially where these can span many years.

Selecting the most appropriate scanning equipment and adopting the right processes to enable capture of the documents are key steps to gaining acceptance.

Depending on the size of the practice, a single scanner working over the network or individual smaller scanners for teams may be options. A multi-function machine that provides coping, printing, scanning and faxing can be purchased from around $25,000 upwards or leased at a reasonable monthly cost. Of course there are smaller and cheaper versions as well.

However, installing scanning equipment alone, without due consideration of the workflow and practices that need to change around the scanning will not achieve success. There are many questions that need to be considered as part of the strategy including:

Who will do the scanning?
Will the change impact your mail in and mail out procedures of staff?
What will happen to the original documents?
If paper is to be filed - what impact will this have on current storage?
What naming standards will you adopt to enable people to find the electronic documents?
How will the historical records be managed?

And of course there are IT considerations as well:

How much electronic storage will be needed?
How will this be backed up and secured?
What quality of document will be required?
How will the electronic records be managed?
What document security properties should be adopted?

Dual screens

As accounting compliance work involves the use of electronic work papers and software programs, many staff lose time and efficiencies swapping between program windows scrolling across to see relevant information in large documents and waiting for the windows to repaint. To overcome this, many practices are introducing dual monitors for each staff member. This enables the staff to see and work on the work papers and accounting programs at the same time. There are several issues to consider as part of the implementation of dual screens including:

Size of the screens.

If you are upgrading should you go to a very large screen that allow two programs side-by side or select manageable dual screens about 17"? Some firms simply rely on existing vendors and desktops to "double" the existing screens. Some firms move to larger screens such as 24" . Larger screens can introduce other difficulties such as Occupational Health & Safety factors . For example, larger screens may mean staff will need to move their whole head to see the screen rather than relying on eye movements to scan the screens.

Technical specifications of current computers.

You will need to check that the computers can support dual monitors and that they have suitable and appropriate video cards. If current desktops cannot support dual screens there may need to be additional upgrades to the desktop configurations to support introducing dual screens. There are also other acquisitions which should be considered including additional software such as Ultramon that supports dual screens and moving windows between the two screens.

Compatibility of your current software to work with two screens

All current programs should also be reviewed to ensure that there are no compatibility issues arising from the introduction of dual screens. Comprehensive tests should be conducted for all software used by staff who will use dual screens to ensure that there will be no issues once they are rolled out.

Work practices and desktops

Workspaces and desktops are another consideration. Are desks large enough to accommodation dual screens comfortably and still allow other desktop activities to take place? Are there any other issues that need to be assessed in terms of adaptability of staff to adopt new technologies and practices? Some firms have found older staff more resistant to change and this may require different approaches during implementation.

Workflow

There are many software packages today that are available to assist with electronic work practices and manage workflow. Some are stand alone and some are available as an add on module to existing software. Some of the issues that need to be considered include:

Integration

Any firm with an investment in specific practice software or records management software may need to look at the integration issues carefully. What is the relationship between timesheets and workflow? Does the workflow tool integrate with other practice management systems used? Does it integrate with email tools? To be used widely, workflow tools need to be an integral part of the work process – requiring no additional work and no need to duplicate information into two systems. Any additional work that is required will create barriers for staff and will lead to a poor result.

Paperless progress meetings

Many managers rely on monitoring Work in Progress (WIP) as a measure of getting work done. Members of each team print out extensive WIP reports and then meet to discuss and markup jobs for action. Those firms that have adopted electronic workflow software indicate great savings in cost and efficiency by conducting their progress meetings with a laptop, data projector and the software. Immediate decisions can be made, based on consensus among the team, about resources and other issues and then updated directly into the system. The results are that after the meeting staff can immediately get back to work and have access to the updated schedules as opposed to having to update their own WIP schedules.

Staff roles

Another consideration for workflow software is the role of professional staff and support staff in using the tools. Some firms have employed a full time workflow manager with project management skills to manage the workflow functions for the firm. Other firms rely on the professional staff to update the workflow software to reflect the steps completed for each job. There is no single correct answer – you will need to consider what is right for your firm and staff.

Implementation Considerations

One of the most important considerations when implementing new technologies and electronic work practices is the staff. The following highlights some key considerations when moving to a "paperless office".

Communication

Buy-in from staff is critical if you want a successful implementation. Depending on the depth of change proposed, implementation can take some time and it is critical that staff are kept informed of what is happening.

Company culture

Those firms with younger members of staff may find it is easier to introduce this type of technology change. Some firms have found that it takes less time for younger members of staff and graduates to adopt the practices while in more established and larger practices there can be cultural resistance that needs to be managed.

Digital signatures and document authentication

An important part of electronic work practices and e-documents is authenticating the document. Digital signatures are becoming integrated with various software tools to allow confidence in electronic records and documents. Strategies for implementing and managing digital signatures are an important part of any project aimed at moving toward a paperless office.

Backup and disaster recovery

As more and more records are stored electronically backup of data is now more important than ever. Strategies for capacity management are critical to ensure that backup and online storage can handle the increased volume of data. Testing of backup and recovery functions is mandatory and should be done regularly to ensure that all data, whether archived or current, can be accessed.

Business continuity

Now that your firm is paperless, all staff using the new system require access to the software tools and technologies as well as the e-documents at all times to perform their work. If the equipment or software is not performing, staff cannot perform their work and valuable time is lost. Costs to the business can be high in terms of lost billable time, not to mention the loss of reputation for the firm through not being able to deliver client services.

Summary

Do paperless offices exist? Are they feasible? While many of the technologies and software packages available today do encourage paperless practises, a common message from firms who have implemented these technologies is that the outcome is less paper not paper-less! However there are benefits to be gained from starting on a project to address these smarter business practices.

Judith Merryweather is Principal of Alexer Pty Ltd an IT consulting company. Click here to contact Judith

Project evaluation

Ever been confronted with a potential new project and not know if it was being properly set up? Neville Turbit was asked by a Senior Business Manager just what issues should be addressed before a project is started. In this article, he provides six questions that every non technical business manager can use to help evaluate a new project.

The questions listed here are open ended, and any simple answers should ring warning bells. Almost all projects have a complex answer to each of these questions and they need to be talked through.

Outcome from the project

How will the project impact the organisation when it is completed?

The purpose of this question is to look at who will be impacted, and the likely changes that will need to be catered for. It is not just about the IT system. It is about the changes to business processes, personnel, customers, physical locations and skills required.

Questions

Here are some other questions that help uncover information:

Are the people who will be impacted by the system going to be surprised when it is implemented? (In other words, do we need to manage expectations?)
How are you going to ensure the system does not dictate or perpetuate inefficient practices?
What will people miss when their current process is changed?
What impacts will be felt outside the company?
How will I see a difference to my business area?
How will I know it has been a successful result? (Beware of an answer that focuses on the on time/on budget project completion. The team may be too internally focused)

Example:

A project to create a new billing program will impact customers. How are they being involved in the project and their needs met? One project I heard about resulted in a 10 digit delivery number being generated. Their major customer could only handle eight digits. Nobody spoke to the customer until it was too late. Deliveries could not be booked in and were consequently sent back to the supplier warehouse. If the customer had been involved earlier, there is a good chance the problem would have been picked up.

Resourcing the project

What arrangements are in place for resourcing the project?

One of the primary failure points in projects is the availability of resources. The concept of executive support does not always run to specifics such as providing three people to do testing full time for two weeks.

The project manager should identify what resources are required, and negotiate availability. This includes internal and external resources.

Questions

If contractors are to be employed, how easy is it to get people with the necessary skills?
What is the likely lead-time? How will this affect the schedule?
Do you have agreement to get specific business resources at specific times?
Do you feel the business people have the necessary skills to provide input?
Will people with new skills be required after the project to support the new system?
What arrangements are in place to get cross organisational support? (Assuming other business areas are involved)
Where are the potential resource weaknesses?
Who are the key players that, if they were to leave the project, would cause the most pain?

Example:
A project I reviewed was approved in December and started looking for a key resource just prior to Christmas. As you would expect, it was February before a resource was found and started. Two months were lost waiting for the resource to come on board.

Monitoring the project

How will we know on a week to week basis if we are on track?

The project plan should be constructed with regular milestones. More than two weeks between milestones should ring alarm bells. The project manager should be able to provide a set of milestones that will enable the sponsor to see within a few weeks if the schedule starts to slip.

Similarly, reporting financially should be against an agreed cash flow for the project, not against the total budget. There should also be regular estimates provided to the sponsor of the cost to complete. In other words:

Are we on schedule?
Have we spent what we said we would spend?
Do we still think we have enough money to complete the project?

Questions

In addition, the sponsor should ask:

Who will be alerted if there are serious issues?
When will they be alerted?
Is there a gating process to approve the next lump of expenditure?
What criteria will be used to get through the gate?
Are there any issues in how finances are tracked?

Example:
A project to roll out Windows XP to a number of branches was presented to the general manager of the area. What was not known at the time was that some of the PC’s needed to be replaced because they were not capable of running XP. Because the rollout was not a consistent number of upgrades each month, the sponsor believed it was on track until the fourth month of a six month program. By that stage, the budget was 80 percent gone, and only 60 percent of the PC’s had been upgraded rather than the planned 75 percent. The project manager hoped to catch up in the last few months, but waited until the fourth month to tell the sponsor that he needed more money.

He was behind schedule and over budget. If he had milestones that indicated that by the end of month one he would have 15 percent complete, and his cash flow reflected the milestones, it would have been evident from the start that the schedule was slipping, and that the expenditure was creeping ahead.

Risky areas in the project

What are the risky areas in the project?

There is a difference between identified risks, and risky areas. When the discussion is taking place, there may not have been a comprehensive risk assessment study undertaken. What the question focuses on is, given the nature of the project, where are the risky parts? Is it resources? Is it technology? Is it unknown data quality?

Questions

Once identified, the risky areas can be discussed and perhaps further work undertaken to see if there are ways in which the risky areas can be catered for.

If there were a potential single point of failure, what would that be?
Would you be surprised to uncover any new and substantial risks?
How often will a risk review be undertaken?
Who will be involved in that review?
Will it identify business risks as well as project risks?
Who will be responsible for managing the business risks?
Will there be a contingency plan if the project should fail at some point?
Why is the risky area required?

Example:
A life insurance company was converting a small number of old policies to a new system. An area of concern was the lack of people who understood the rules surrounding policies that were over 20 years old. The company had changed hands a number of times and in the merging of different departments, knowledge had been lost and documentation was patchy.

Once identified, it became a separate exercise for the actuaries to look at these old policies to identify what documentation existed. In the end, it was decided to buy out the old policies, or offer conversion to a newer policy at a rate that was beneficial to the policy holder. It was going to be too hard to try and reconstruct the policy rules by reverse engineering the old Cobol programs. The project was significantly scaled back, and only a few policies converted. The others were transferred or bought out.

By exploring where risk exists, it is possible for the sponsor to get an understanding of where to watch, or even if there is another solution to a potential problem.

Project options

What other options have been looked at for this project?

Beware of the project manager who immediately starts talking about the solution in a technology sense.
"Of course we will use ASP.Net running off an Oracle database and use a mix of C# and VB."
The question should be
"What other options have you looked at and why is this, the best option?"
For this reason, the business manager needs to have senior technical support in the room. It should not just be the project manager or developer who decide because it is a variety of technology they are familiar with, or would like to play with.

Basically it should be the business who decides the requirements and IT who decides the best technology. IT should be able to justify it in terms business can understand. For example, will the technology result in?

Lower cost to deliver
Faster delivery
Better integration with other systems
Lower maintenance costs
Easier to scale up at a later date

Questions include:

Do we need to do this project at all? What will happen if we do not do it?
Why is the deadline important? What happens if we do not meet the deadline?
Should we consider a package rather than build a solution (or vice versa)? Why?
Can we change the way it is delivered? For example, rather than implement all at once, can it be delivered incrementally?
Can it be rolled out to only some users or some customers?
Can it be tested by running in parallel with our existing system?

Example:
An interim solution for an insurance company to handle customer queries was built using a technology called "Mantis". Like most people I had not heard of it before, or since. The main reason was that we had a programmer who had taught himself the language and was looking for a place to practice.

Six months later, we had a fully operating system that did the job. Then the developer left the organisation. The results were predictable. We could find nobody to make changes, and ended up employing the ex-developer on weekends to add bits and pieces to it. In the end, it cost considerably more than it should because of the fact nobody could support it. Mantis turned into a dead end technology and the application had to be re-written much sooner than anticipated.

The questions to ask about these technologies are things like:

Do we have experience in this technology?
Is it stable or is it new and evolving?
How easy is it to get people who know the technology?
Can we support it in the future in-house?
What is our migration path out of this technology if it does become a dead end technology?
What sort of upgrades are we likely to have forced upon us over the next five or 10 years?

Project Goals and Scope

What do you see as the goals of the project and what is in and out of scope?

All this had probably been documented but it is worth asking people to explain verbatim what they see the project is trying to achieve. If they can only explain the goals in terms that came straight from the business case, they probably don’t really understand what the project is all about.

The second part of the question is really about how you translate the goals into deliverables. How do you deliver something that will achieve those goals? Conversely, what are the things that may be on the periphery of the project that do not contribute to the goals and should not be in the project?

Ask questions such as:

How does this contribute to the achievement of goals?
If we did not do this work, how would the goals be impacted?
Is there anything that needs to be done to create a foundation for this project such as installing new infrastructure, or upgrading PCs?
What concerns to you have regarding areas where the scope is not clear?
If you were to get a blow out in the scope, where is it likely to happen?

Example:
I was asked to review a project that involved a billing system for a government department. When I held a workshop which involved both the sponsor and project team, I asked the project manager to articulate what she thought the project was trying to achieve. To condense the story, the project manager talked about an efficient payment processing facility for sub-contractors. The Sponsor was astounded. She saw it primarily as a way to monitor the cost of individual sub-contractors so that higher charging sub-contractors could have their rates reduced when contracts were re-negotiated. She was quite happy with the efficiency of the existing system but couldn't get comparative information.

Summary

For any senior business manager evaluating a project should not be an impossible task. Most problems are not technical. They are usually related to either not clearly understanding what is to be built, or problems with the people involved (or not involved as the case may be).

The project manager should be thankful to have the opportunity to gain a shared understanding with the sponsor as to what the project is trying to achieve, and what needs to be done to reach those goals. She or he should also be pleased to get agreement about the resources assigned to the project. If the potential problems can be addressed early, there is less chance of something going off the track as the project progresses.

The sponsor is looking to find out if the project is sensible, and where they should focus during the project. This includes the risky areas, the milestones and the cash flow in the project. They also want to be comfortable that options have been explored and the path proposed is the best option.

A discussion exploring these six questions can bring the sponsor and the project team closer together and ensure they understand the mutual obligations and commitment required.

Neville Turbit is the principal of Project Perfect. Project Perfect is a project management software consulting and training organisation based in Sydney Australia. Their focus is to provide creative yet pragmatic solutions to Project Management issues.