Consolidation is a big problem that will never go away on its own. Unless you are in the lucky 26% minority who run a single ERP, GL consolidation is likely a constant and nagging worry. In fact, because most legacy ERP systems have been heavily modified over time, technical debt will continue to accrue, manual processes will persist, and data security will always be a concern.
The worry is justified: your current manual processes are costly, error-prone, time-consuming, and expose your data to unnecessary risk. And then there is the fundamental issue that most of us try to ignore: taking data out of your accounting systems to consolidate just doesn’t make a lot of sense.
Of course, many point solutions exist specifically to perform consolidations and many companies have found them useful. However, their utility is often undermined by integration issues that make master data maintenance a nightmare in its own right – a single new GL account in any of the entities can stall your entire close. By their nature, point solutions are more of a band-aid than a cure – they do nothing to address the fact that there are still multiple ERPs running in the back end.
The best approaches to consolidation seamlessly integrate ERPs to provide a single view across your GLs while also facilitating a means for unifying legacy systems into a flexible modern platform.
With the right approach and application of technology, you won’t have to wait until ‘someday’ to consolidate your multiple GLs and ERPs. In fact, you don’t need to wait at all. Solutions exist today that enable you to consolidate your financials in the way and in the timeframe that makes the most sense for your business. Any of the three approaches described below can dramatically reduce the time, effort, and expense of consolidating GLs and will give you complete visibility across all your financial systems from a single interface. Your vision of quicker month-end closings, automated reporting, and real-time consolidations is attainable. Why wait?
For organizations that have heavily customized and perhaps disparate ERP systems, simply consolidating GLs can represent a big win. This is why specialized point solutions exist. But as pointed out above, these are fraught with their own troubles. The integrated approach to consolidation provides the most streamlined path to GL consolidation within a new ERP environment but without committing to changing existing ERP functionality. The benefits of this approach are twofold: you quickly get a clean, unified view of all your GLs along with automated real-time reporting capabilities while setting the foundation for moving to a modern platform over time.
Nextworld makes it easy to bring your ERPs into your existing IT landscape with robust out-of-the-box integration capabilities that facilitate complex consolidations and reporting to provide a single view of multiple companies, currencies, charts of accounts, and fiscal calendars from across your enterprise. Use the same approach to seamlessly integrate future acquisitions without the need to modify or replace newly acquired ERPs.
The hybrid approach provides flexibility for companies that understand the value of modernizing their core business systems but are not ready to commit to moving all existing ERPs at once. This option allows organizations to sustain current investments in legacy ERPs while moving select ERPs into a new environment and consolidating all financial information into a single, unified view. A key advantage of this approach is that organizations can understand exactly what resources needed to fully convert one or more ERP systems and how new capabilities can improve processes, streamline workflows, and help shed technical debt. The hybrid approach simultaneously consolidates GLs and provides a clear, proven path forward to a unified ERP future.
For flexibility without the commitment to replacing all your ERPs at once, Nextworld allows you to integrate some of your ERPs with Nextworld’s GL for financial consolidation and reporting while you prepare to replace your other ERPs over time. Nextworld enterprise-grade applications allow you to manage sales, procurement, inventory, projects, manufacturing, and other functions in the way and at the pace that is best for your business.
For organizations driven by the competitive imperative of business transformation or those that can no longer suffer with current consolidation processes, pursuing a unified approach may be the best option. Similar to the hybrid option, this approach can be viewed as a “slowly peel and replace” method as opposed to traditional rip-and-replace tactics. It follows the same basic stepping-stone methodology but with two important differences: commitment to achieving a fully unified ERP on an accelerated timeline.
To pursue a unified approach, it is important to retain the existing characteristics and quickly mimic the valuable customized functionalities that you want to bring forward onto the new system. Business units should never have to sacrifice existing functionality. This is why you need a flexible platform that is built for customizations. With a unified ERP, organizations will be positioned to quickly and safely modify their systems to respond to the forces that compel change like macro-economic shifts, industry trends, and M&A activity.
Transform your operations today and prepare for tomorrow by replacing all legacy ERPs with Nextworld’s no-code enterprise applications platform. With thousands of applications available out-of-the-box and the ease of enterprise no-code customization, you’ll quickly gain new capabilities like real-time consolidations and automated month-end processes – all in a single, future-proof system.
No matter what approach you choose, Nextworld allows you to quickly consolidate your financials while providing a parallel path to consolidating your ERPs using the approach that is best for your business.
And, for the other 26% of the businesses without a consolidation problem, your compounding technical debt may be all the motivation you need to consider a new, future-proof enterprise no-code accounting system.
Director, Solution Engineering
Nate is a CPA and brings over fifteen years of software industry experience to his role at Nextworld. He has firsthand knowledge of multiple ERP solutions, donor management, CRMs, and various reporting tools. His areas of expertise include budgeting, banking, fixed assets, AR, AP, general ledger, and intercompany & consolidations.