| 5 Steps to a New Practice Management System by Tom C. Davis, CPA |
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Many firms are finding that the move to a new practice management application is a very difficult task. It involves the most central computer application in your practice. The firm’s decision-makers, who are the primary recipients of practice management system info, are not the most tolerant and patient technology customers in the firm. Furthermore, most firms want to take this opportunity, to substantially (radically) change the availability and type, of their practice information. What results here is a painful (but seldom fatal), lengthy, and expensive implementation process that falls substantially short of the expectations of the firm. Firms can avoid this bad experience by following a 5-step process. Step 1 – Infrastructure review Step 2 – Information requirements Step 3 – Revision of current concepts Step 4 – Selecting the application Step 5 – Conversion, implementation, and training Infrastructure Review In the last 2 years, I have seen more problems that related to infrastructure issues than any other area. The new crop of Windows practice management systems puts an enormous strain on a firm’s network and workstations. When you add this increased resource demand to the existing amount needed to support office, groupware, tax, and other applications, you can run out of server and workstation resources. If your LAN and workstation infrastructure is not adequate, you will have data integrity and performance problems with any of the Windows practice management applications. To avoid this, ask the vendor for their specifications for server and workstation memory and processor speeds. Focus on the key word “minimum” and recognize that most partners and other users will not accept “minimum” performance. You cannot have too much memory or too fast a computer for high billing rate staff. If you have multiple offices, make sure you have enough bandwidth connecting the offices. There is a direct relationship between high bandwidth and data integrity in a multi-office environment. Information Requirements The focus of this step is to set expectations. Many practice management implementations are less than successful because users are expecting one thing, but the system delivers something else. The way many firms implement is similar to building a house without a detailed blueprint. Make sure users understand the new system will not present information (either on-screen or in printed reports) in the same format as the old system. Do not try to build the new system to supply the same information as the old application. If you are going to take this approach, why change at all? Take the move to a new practice management system as an opportunity to ask users what information will make them more efficient. Revision of Current Concepts Most firms are operating with practice management concepts that are decades old. Evaluate all work code schemes, client numbering, billing processes, billing rate logic, and other practice management concepts, to determine their function in the new system. Wherever possible, simplify and streamline these concepts and processes. Identify which concepts are providing important information, and kill the undesirables that are not used or needed. Keep in mind that the more complex and logical a system is, the more prone it is to not work correctly. Also remember that the value of information moves in direct proportion to its velocity and its correctness/completeness. The faster and more accurate the information is, the more value it has to users. Selecting the Application Once you have completed the proceeding 3 steps, you will have much of the information needed to identify the specific features needed. You then choose for the offerings available. You will face some other considerations besides the applications’ features. There is a significant amount of consolidation happening in the accounting firm software market. Consider the staying power and development resources of the vendor. However, don’t get intimidated just because applications could change hands. There have been very few instances where a Windows application has disappeared after being acquired (this author can identify just one such case). Another point of consideration is that the larger vendors are beginning to offer “suites” of applications that can share data between the components of the suites (set it up once, use it in many applications). While the current suites offer value, the possibilities the future hold for this data exchange is huge. Keep an eye out for suites that feature the practice management system as the “hub.” Do not forget support. You will need it. Your new practice management system will be used in new ways to provide timely information. This means there will be questions, and yes problems, that require the assistance of the vendor’s technical support department. Get an understanding of the support process and ask references about their support process. A large number of firms have made changes in their time and billing applications in the last year and many more will follow in 1999. Additionally, most vendors have introduced new, powerful programs that have required support as old users have converted to new systems. This act translates to less than stellar support. This issue will continue to be a problem for users as the year progresses. Conversion, Implementation, and Training Now you have determined needs, considered the way the firm has handled practice management in the past, and have selected an application (you have a plan). All that remains is to implement this plan. When converting information, come to grips with the fact that you will probably loose your historical information. Most vendors will not convert history from older systems to the newer ones. This means you will keep you client, staff, workcode information, and open WIP and accounts receivable. Make sure users are informed of this and make arrangements to give them access to the old system to get their historical data. Implementation (installing the application and the converted data) is very straightforward with all the practice management applications in this review. Read the installation instructions and follow them to the letter. Many problems with performance and data integrity are traced to improperly configured workstations and servers. Make sure you check the application requirements and instructions that relate to anti-virus software. It may be necessary to exclude certain fields from anti-virus testing. Training is a very important component of the implementation process. Make sure firm members understand the reason for changing the practice management application. Also communicate the firm’s expectations as they relate to the new system. Also, try to train firm members at the point the system is ready to be used. If they can come out of the training session and immediately start entering data and getting information from the system, there will be less pain and suffering from the changes. A final consideration for the implementation steps is the need to “run parallel.” This is a “damned if you do, damned if you don’t” situation. Running parallel offers an excellent “safety net” as well as providing an excellent basis for comparing the initial operation of the new system to the old one. However, there is considerable cost in double entry of the information and comparison of the results. This cost is greatly increased if there have been substantial changes to workcodes between the two systems. Since, in most instances the old system would still be available, this becomes the safety net that can be reverted to if needed. If the plan is adequate and the application has a history of reliability, do not run parallel, if at all possible. This Review This review looks at practice management applications from CCH, CMS, CPA Software, Creative Solutions, and RIA. These applications span a wide range of price and capabilities. On the similarity side, all of them have the ability for users to enter time on screen and from remote locations. They all support on-screen billing, as well as the traditional paper based approach. All the applications have an open database structure that allows access to the data using other applications. This article looks at the differences between the applications and other pertinent information. PACS Software, Version 3.1 PACS
for Windows version 3.1 The
two big news items from PACS are their acquisition by CCH and the integration
of the PACS practice management system with the CCH Profx tax application. This
acquisition adds practice management capabilities to the emerging CCH suite of
applications, which already includes tax (Profx ) workpaper (AuditVision) and electronic research. PACS uses a “grid” presentation in all aspects of its system. Each user can customize the grids by adding, deleting, and rearranging grid columns. Moreover, the user can instantly change grids to reflect different presentation requirements. Every firm has different information needs. Instead of providing a limited number of user definable fields, PACS allow the addition of hundreds of fields to the clients, projects, and staff data tables. These custom fields can be simple text or date fields, or they can be pull-down lists of data choices or logical (true/false) fields. This allows firms to maintain very precise information about its clients, staff, and projects. PACS does an excellent job handling projects. In PACS, projects provide scheduling, inventorying of client and firm services, and budgeting. Projects and their related task components can be created and edited “on-the-fly” from the time entry screen, thereby making it easier to maintain a firm’s project system. PACS’ billing capabilities are very easy to use. In the on-screen billing section of PACS, the grid approach combined with extensive grouping and sorting features, allows billers to instantly arrange unbilled WIP information in the manner most conducive to efficiently completing each bill. PACS’ billing features are very conducive for pushing down the billing process from partners to other firm members. A bill created by one firm member is easily reviewed and edited by someone else. Also, if a firm elects to require billing review, a reviewer must complete the review process before the invoice is available for finalization. PACS has a strong report set. Every report has an extensive set of filters and other sort features to present report information in hundreds of different formats. Also, PACS has a “Custom Report Wizard” that allows users to build basic reports directly from the PACS for Windows system. Reports developed, using Seagate’s Crystal Reports software, can be imbedded into the PACS system for use by all firm members. This latest version of PACS features integration with CCH’s Profx tax application. Client information that is changed in either PACS or Profx can then be automatically updated in the other application. Visual Practice Management CPASoftware’s Visual Practice Management (VPM) has just been released in a new 32-bit version. This new platform allows CPASoftware to take advantage of the inherent speed and reliability of 32-bit operating systems. Additionally, the company has revamped its project capabilities. VPM has excellent screen layouts. Their approach makes VPM easier to use without making sacrifices that reduce the effectiveness of the application. This makes VPM easier to explain to new users, and it promotes the efficient and more complete use of the application. The easier a system is to use; the more firm members will use it. This translates into more information available in a timely fashion. VPM’s time entry approach requires users to release time before the system administrator can post, so that time and expense information is available for billing and reporting purposes. A timekeeper can compare time off allowances for sick, vacation, and other allowances to actual time taken. Staff can also “bank” time for comp time purposes. A “In/Out Log” reflects the in-office status of each staff. VPM has a “tiered” work code structure that breaks down into category (tax, audit, etc.), subcategory (1040, 1120, etc.), and service (prepare, review, etc.). This approach provides as much (or as little) detail and flexibility as a firm needs. While VPM does not offer extensive database or screen customization features, it does however, have 20 “Client Custom Fields”, to specify information not handled elsewhere by the system. Staff information includes CPE related information, department, skill level, and 20 firm-defined fields. One of the significant new features in the new 32-bit version of VPM is its change to the project tracking system. In addition to the work inventory capabilities of project tracker, staff can now key time to the project. Billing can now focus on the event (project), as well as by workcode or staff. This capability makes it easier to bill work as soon as it is completed and it is easier to “push down” billing to the staff that has responsibility for a specific project. The clear, concise screen formats continue in the billing portion of VPM. The biller can select Clients and WIP items with a click of the mouse button. Prior invoices are viewed on screen, to provide the biller with the information needed to make a billing decision. Furthermore, “reason codes” are available to explain these billing decisions. WIP adjustments are either allocated to the firm or to the staff. A form of contact management is accomplished by creating client notes that reflect the staff creating the note, the date of creation and the topic of the note. All firm members can review these contact notes. Contact notes can be sorted by date, employee, or topic, and can be print as needed. CPASoftware has an excellent support reputation.
They offer training services in their
Pensacola, FL offices, as well as at other locations around the country. They do not offer on-site training at firms. CMS Open CMS is new to the accounting firm market. They have been in business since 1978 and have their most significant concentration of clients in the law firm sector. As you would expect from a product with such a high stickler price, CMS is an extremely versatile product. It is developed in the C++ programming language using a SQL / Sybase database structure and offers complete customization capability for every aspect of the system. An unlimited number of data fields can be added to the database structure. Screens can be crafted to present exactly the information needed. This flexibility/craft ability translates into a complex system. However, this complexity is the reason you pay the big bucks for the application. You are not just licensing the software. You get up-front consulting, customization assistance, training, and the ongoing support needed to make this system work. CMS Open provides unlimited billing rates at the timekeeper, client, event, and work code levels. One can identify rates for a given office and department, client and event, individual timekeeper, or rank. Rates also have an effective date used for historical analysis. One interesting CMS Open feature is CMS Alert! This feature has a “rules based” inquiry feature that will send emails and perform other actions when a certain condition occurs. If a firm member does not enter a certain number of hours, an email message is automatically generated to the staff who is delinquent. CMS Alert! will either send a message through any MAPI-compliant e-mail system or can be made to perform any number of tasks through scripting. CMS Open time entry is accomplished with a typical time entry form. However, entered time is displayed in a very concise Monthly Time Calendar, as well as in a Daily Time Summary format. Staff can enter time through the Internet, and a remote time entry piece exists for staff use when a staff person is not in the office or attached via the web. Time entry also has a Query-by-Example-Used feature that quickly searches for all entries that meet selected criteria (e.g., all time entries for a particular timekeeper on a given date). CMS Open’s flexibility also extends to the billing area. The systems features excellent transfer features as well as capabilities that can split entries, recalculating values, and deleting duplicate entries. CMS uses Word or WordPerfect for invoice formatting and document assembly, making it easy to meet formatting needs. CMS open has extensive “groupware” features. Its Calendar Management application is an integrated calendar system where users can track important activities for an individual, group, firm, event or client. Scheduling calendars are generated, as well as other types of calendars for various types of events. Calendar Manager creates reminders (single or recurring) for appointments, events and tasks from the current date up to the actual due dates. Users can define main event reminders, which trigger other events. When a main event date is entered, the system will automatically schedule the triggered event. CMS Open also has general ledger capabilities that automatically handle the posting of time and billing information to the firm’s books. CMS’s integrated accounts payable module processes vendor invoices and pays them by using a mass check writing application. Its accounts receivable application can apply cash receipts to specific invoices, across invoices (paying certain categories, such as fees, taxes, or disbursements first from oldest to newest invoice) or through invoices (paying invoice in its entirety, from oldest to newest invoice). The Client Disbursements module allows firms to enter and post charges incurred on behalf of clients. These soft disbursements include such charges as photocopies, and facsimile transmittals for which no direct outlay of cash is required, while hard disbursements, such as airline tickets and witness fees, are handled through the CMS OPEN Accounts Payable module. The CMS OPEN MarketSense module provides instant access to system information. MarketSense tracks client and prospect information, including full names and addresses, employees assigned to clients, contacts with activities. The mailing list management feature in CMS OPEN MarketSense automates the production of marketing mailings. Market Sense also provides an in-depth employee maintenance section that allows firms to track human resource information such as personal and background information, skill sets, civic and professional activities for all employees.
Creative Solutions Practice Management (CSPM) Creative Solutions and
RIA are owned by the same parent company. While the Creative Solutions Practice Management application has its
roots in RIA’s GoSystems Practice Application (formally Ace Practice) there are
substantial differences between the two applications. These products will continue to diverge as time goes on.
CSPM consists of components for time and
billing (Practice Solution), project control and monitoring (Scheduling Solution), and
due date monitoring (Task Tracker
Solution). This application is a
“real-time” time system as far as time and expense entry is concerned. Since there is no submit or post process,
time and expense information is available for billing or reporting as soon as it
is entered. This feature does not
eliminate controls that insure that time and expense information is
complete. Various printed and on-screen
reports are used to make sure that stave have entered the appropriate amount of
time. Scheduling Solution and
Task Tracker Solution can be used as stand-alone applications or can be
integrated with CSPM. Scheduling
solutions handles the “project inventory”. It is used to maintain information about project status, staff
assignments, and budget information. Task Tracker is used to track due dates.
Task Tracker has more than 700 federal and state due date
profiles build in and allows the creation of an unlimited number of
user-defined profiles. Combined with CSPM,
Schedule Solution and Task Tracker help firms create a work inventory of firm
and client services, schedule staff for these services, and monitor the
progress of these engagements. In its next release, CSI plans to have integration between CSPM and its UltraTax tax application. UltraTax invoices will flow to CSPM billing and accounts receivable where they will be included on reports, and will automatically relieve associated WIP. GoSystem Practice RIA (formally CLR) is one of the most active innovators among accounting firm software vendors. Their GoSystem Practice application includes modules for GoSystem Practice, and its add-on modules feature time and billing project management, due date monitoring, client marketing, CPE tracking, custom reporting, remote time entry. GoSystems practice is a component of the GoSystem suite
of applications that is rapidly moving towards a completely Internet-capable
set of accounting firm tools. RIA is
looking to develop a series of tightly integrated applications that firm members can access from any location. Very large firms and
those firms with multiple locations face some difficulties in creating a
on-demand, centralized practice management environment. The larger the database and the more firm
members simultaneously entering information, the more data integrity and speed
issues arise. For large and
multi-office firms, RIA has a SQL Server version of GoSystems Practice. This client-server version of Practice
offers the data integrity and speed needed in these complex environments. In GoSystems Practice, time can be entered either in a batch or real-time mode. The billing features are designed; so that billers can perform on-screen. GoSystem Practice still retains the “post process” for finalizing bills. Billing write-up’s and write-downs can easily be allocated to specific staff. GoSystem Practice has
excellent features for managing staff and client services. “Engagements” keep track of broad categories
of client services. “ Events” are used
to detail the steps in providing client services and can be assigned to staff,
have a due date, and a specific workcode. These features allow firms to create a work inventory of firm and client
services, schedule staff for these services, and monitor the progress of these
engagements. “Tasks” are used to budget
events. The system has good reports for comparing actual time spent on task to
the budgeted plan. Other GoSystem Practice modules move this application out of the time and billing environment to true practice management. In this on-demand, real time environment, firms can leverage client and other practice information to provide extensive practice administration tools. The market module gives firms the capability to monitor contacts from the prospect stage through every stage of being a client. The custom report module uses a “Query Builder” to create graphs, mailing labels, and custom reports using data that already exists in GoSystem Practice and its corresponding modules. CPE Track accounts for CPE time spent, and provides each professional in your firm a way to record courses taken or scheduled for the future.
TB*32 UniLink has recently begun shipping its new Windows practice management. The new 32-bit application, TB*32 is not a replacement for UniLink’s TB*Plus DOS application. It is a member of UniLink’s new “Unity” product line of Windows applications that includes CashLink*32 (checkbook management, and GL*32. TB*32 is developed using the Microsoft Visual Basic application and has a Microsoft Access database engine. The first release of TB*32 has basic time and billing features but does not have all the functionality of UniLink’s DOS practice management application. Future updates to TB*32 will add the missing features. TB*32 is a real-time, on demand system. It does not use batch posting, so time and expense information is immediately available for billing and reporting purposes. TB*32 has capabilities that allow users to define the time sheet presentation to make it easier to enter, edit, and review time and expense information. Time can be entered into any time period, without regards to a “current period” concept. Compared to the UniLink Dos practice management system, TB*32’s billing capabilities feature more user definable options for presenting WIP, as well as new tools for using billing messages that have been entered in time and expense entry and firm-standard billing message text. TB*32 has progress bill capabilities but retainer billing features must still be added in a future release. In the reporting area, TB*32 features increased sorting, summarization, and presentation capabilities. It also has most of the reports that were included in TB*Plus. Future releases will add additional reports. No custom report writer has been included since TB*32 uses the Access database structure that is accessible by other applications (Seagate Crystal Reports, Excel, Access, etc.). Conclusion The key to the successful implementation of a new practice management system is a well-developed comprehensive plan. The plan will set expectations and provide the basis for the selection of a specific practice management application. It will also insure that firm members receive the training they need to make the implementation effective. Without the plan, expect to have problems. There will be no clear relationship between the efforts made to implement the new practice management solution and the results achieved. Firm members will not clearly understand the reasons for the change nor will they understand the intended results. Another required element in the process of implementing a new system is the need for a strong technology infrastructure. A firm’s network and workstations must be adequate to meet the high resource demands of the Windows practice management system. Also make sure you understand and comply with all the vendor’s setup instructions. |