It’s an everyday occurrence in the equipment finance world – “Is my technology broken?” Afterall, software doesn’t code itself and humans make mistakes. At Tamarack we were recently part of a discussion about the lease-type capabilities of a particular Contract Management System (CMS). While listening to the customer lament that the software was not calculating a particular lease type correctly, our team leader was recalling their Certified Lease and Finance Professionals (CLFP) training and thinking “How could a company selling CMS software not properly handle a TRAC lease?” People do make mistakes. The question in our world is often “Is the user or the software right this time?”
But here’s the thing. This customer was at a dangerous inflection point in their technology deployment. This wasn’t an online mortgage calculator; they were six months into deploying a lease accounting system and were considering changing software platforms to get to the functionality that they needed for their business to be successful. Our team’s first thought was “The technology probably works. This might be a user error problem. But we need to investigate.” In this case the clients’ fundamentals were sound. The software was not able to able to perform the required accounting. A change is required.
Three “every day” equipment finance references at Tamarack.
An equipment finance CMS, like most enterprise operating software, is complicated. But for the most part the accounting and workflow has well defined fundamentals that don’t change. Tamarack’s CEO, Daniel Nelson and Director of Professional Services, Chad Carlson, are both CLFPs. Daniel is on the board of the CLFP Foundation and together they lead a culture that understands and deploys lease accounting fundamentals.
The CLFP trains and certifies equipment finance professionals based on their handbook – The Certified Lease & Finance Professionals’ Handbook. In addition to using the CLFP Handbook, our team also relies on the textbooks by Halliday and Amembal. This culture of equipment finance fundamentals is part of a systems approach to successfully implementing software. Of course, any enterprise software must also support the workflow of the business and the CLFP is again a great reference. Workflow is key to maintaining the data integrity that makes the accounting correct in the CMS.
But in the complex world of lease types, workflow, and accounting principles how does one know when the technology is broken? At Tamarack we find that there are three keys to enterprise system efficacy and efficiency.
- Fundamental understanding of the function(s) performed by the software – in this case lease accounting
- Implementation of the workflow of the enterprise in the software
- Ease of use – avoiding operator confusion and errors
An understanding of the fundamentals of the function performed by an enterprise system, in this case lease accounting software, is critical to a successful deployment as well as validating the software to establish trust with both users and business leaders. Enterprise software automates and scales the functions of the business. As such, the implementation team must understand these functions so that they can validate the implementation as part of the workflow. Imagine trying to put the engine of a car together if you had no knowledge of how internal combustion works. Enterprise software is no different.
When deploying enterprise solutions, make sure that the implementation team knows the fundamentals of the necessary functions. Lease accounting is complicated and the practice changes – the CLFP Handbook is on version 8 – so the team must have a certain skepticism for the software, but the key is having ability to correctly judge right from wrong.
Since the first objective of an enterprise system is typically automation and data integrity, the system must be installed and configured to correctly implement the workflow of the business so that it doesn’t automate mistakes. In this case the team must understand the credit process, origination and funding approval steps, leasing account, documentation, and the risks of automating any of the above. Nothing is more frustrating to a management team than a system that doesn’t give accurate information about the business because of data integrity issues from poor workflow. Reporting must give accurate visibility to each step of the workflow so that performance can be measured and improved.
Understanding and affecting efficient workflow is a design thinking process. The deployment team must use empathy to understand the requirements of both the users and business leaders. The software facilitates and documents the workflow so the deployment must cover each step in a way that is both timely and complete. Data integrity must be facilitated for system validation and an iterative process during deployment assures this. How many times have we heard “Garbage in, garbage out” in the context of CRMs, ERPs, and CMSs? Data integrity is paramount and both the workflow and its implementation in the enterprise systems must deliver. Note that today systems include on-prem, cloud, and mobile experiences all of which must be seamlessly integrated from the data originator to the data analyst to the business operator for the benefits of digital transformation to be realized.
Ease of Use
If one thinks about data integrity like a security problem the first rule of practice is “if it’s hard to use, it won’t be secure.” Think about thumb print readers vs. 16 random character passwords. The latter can be very secure, but humans can’t use them. So, if data integrity and system efficacy are to be achieved, the system must be easy to use. When workers struggle to do their work correctly and in a timely manner, they find ways to get it done and, in the process, violate the integrity and/or completeness of the data.
Simplicity and automation are key and the sign of a well-designed solution. Easy-to-use is, again, a design thinking outcome with well documented fundamentals. In the case of equipment finance systems, usability comes from both the supplier and installer of the enterprise solution. Both teams must have a user-centric approach and must build-test-validate sequentially along the product development and system deployment timelines. System evaluators should pay close attention to usability before selecting a system, and system implementors must practice a design thinking approach to implementing the workflow with the selected system. If Empathize-Design-Ideate-Protype-Test is not a passion, find another supplier.
Equipment finance system deployment is complex, expensive and time consuming. But often it is more so than necessary because of a lack of attention to two things – functional fundamentals and design thinking. We are very fortunate in our industry that we have a group like the CLFP Foundation to maintain and train the fundamentals for users, developers, and implementers alike. Using design thinking in both the implementation process of a CMS is a choice not always made, but one for which there is a lot of help learning how to use it to reduce risk, cost, and time.
Move faster and more efficiently by choosing technology partners that practice both.