IT resolutions worth making this year

By:
JOEL LANZ, CPA/CITP, CFF, CISA, CISM, CISSP, CFE
Published Date:
Jan 2, 2014

How to leverage technology better in 2014

For CPAs and their clients, a new year brings new opportunities to work out the kinks in strategic plans and think up solutions to obstacles that had previously prevented or reduced their organization’s success. The 7 resolutions listed below are a good place to start; in one way or another, they’ll help you to better leverage investments in technology and align them with company objectives. Have you, your colleagues or your firm made tech resolutions worth sharing? Let us know, by tweeting @nysscpa, hashtag #techresolutions.

Resolution #1: Always remember—it’s about the business

All too often, executives focus on the glamor and promises of technology rather than the actual creation of business value. It’s not surprising to read about significant wasted technology investments and related project failures in the business press. Shareholder value creation should drive the investment and use of technology–not the other way around. If you make any resolutions this year, resolve not to shell out for technology unless you first have a clear idea of the possible benefits for business.

Resolution #2: Understand the technology you’ve invested in and use it

Though it’s common, each New Year, for people to sign up for a gym, their membership will only be effective and achieve results if it is used. The same holds true for technology. Yet many companies don’t know how to use the technology they have, because they never allotted the time or resources to become properly schooled in its features, or they assumed that employees would somehow learn on the job. (FYI, given the demands of daily business activities, employees never truly have the opportunity to learn the ins and outs of technology on the job; they should be provided with the appropriate training.) In addition to squandering the investment made, improper use or poor deployment of technology can result in other losses, such as inaccurate data and unprotected access.

Resolution #3: Know the real spend of your technology

Have you ever tried to determine how much your organization really spends on the technology being used? I’m not just talking about the amounts recorded in the accounting
records, but also the soft costs related to wasted productivity. Frequently I find that when determining the costs of technology, organizations only assess the direct cost attributes and not the indirect costs. (For example, have departments within the organization had to adjust their processes and controls to accommodate the new technology?) To better guide their decisions, financial professionals should consider the total spend when assessing the cost benefits of introducing new technology solutions.

Resolution #4: Pay attention to how your competition uses technology

Given today’s reality, in which most business processes are mainly supported through off-the-shelf software, including niche cloud solutions for particular industries rather than customized solutions, benchmarking your organization’s use of technology against your industry competition can be an effective way to help ensure the competitiveness of your service delivery and management control systems. However, the astute professional will need to determine whether it’s better for his or her organization to be on the cutting edge of a new technology—which can be subject to growing pains and development errors, but can result in being first to market—or to use a commoditized, but proven, technology that is also available to industry competitors.

Resolution #5: Appreciate the difference between data and information

Claims about the advantages and promise of big data—i.e., the vast amount of structured and unstructured data collected digitally—are everywhere. Quite frankly, I happen to be a fan and believe that it can provide tremendous opportunity for financial professionals to refine business strategy. However, there is a difference between raw data and information. Just relying on data itself, and assuming it is accurate and complete, can pose risks and may lead you to make incorrect decisions. It is important to combine the raw data with intellect so that appropriate business actions can be taken.

Resolution #6: Manage the vendor relationship

Whether to take advantage of the opportunities offered by cloud computing or to leverage the benefits of traditional outsourcing, more businesses are relying on third-party providers to help with business development and service delivery. Many executives appreciate the opportunity to rid themselves of technology challenges and transfer those responsibilities to someone else. Unfortunately, although the latter can reduce many of the stresses involved with day-to-day operations, overall accountability for ensuring appropriate interactions with customers, protecting their information and ensuring accuracy of information, especially financially related information reported as part of a public company, cannot be delegated. Businesses should establish appropriate programs to ensure that their vendors adhere to the contract signed and that what needs to be protected, is.

Resolution #7: Understand the role of end-user computing on your overall environment

The need for end-user computing—off-the-shelf applications such as Microsoft Excel that allow users to manage and manipulate data—varies between organizations. It may be necessary, for example, to address a legitimate need that can’t be satisfied using the core accounting system. The challenge facing businesses is that end-user computing, including the use of spreadsheets and desktop databases, may not be subject to the same access, completeness and accuracy controls that data residing in the core system is subjected to. For example, a spreadsheet used to facilitate financial reporting may not be subject to the same system development lifecycle controls that an application developed as part of the core system has; consequentially, there may be questions about whether the results produced are accurate. Readers who take advantage of end-user computing would be advised to fully understand how the technology risk is mitigated and to ensure that data standards are maintained consistently throughout the organization to help ensure information reliability.

Joel Lanz, CPA/CITP, CFF, CISA, CISM, CISSP, CFE, is the sole proprietor of Joel Lanz, CPA P.C., and an adjunct professor at SUNY–College at Old Westbury. He is a member of the NYSSCPA’s Technology Assurance and Banking committees. Mr. Lanz can be reached at jlanz@joellanzcpa.com.

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