Hosted vs In-House
Business’ focus has remained centred on improving the business process, increasing workforce effectiveness and reducing cost. To drive these requirements through this year will require further adoption of the latest reconciliation technology available. As retail companies move into the next decade, the cost to achieve the Nirvana of a fully automated reconciliation and exception management solution increases. Many vendors, with User-based licensing, tends to have a negative impact in utilisation of their software. With companies visualising an increasing licenses cost associated with utilisation of the software. Implementation costs increase exponentially to the utilisation of the software. Whilst IT leaders have looked to increase the utilisation of enterprise applications, stories of these implementations taking ‘years’ to complete are widespread, thus negating any operational or efficiency gains initially identified. Finance functions are looking for more value for money.
As Retail companies look to implement new reconciliation strategies, organisations often neglect to incorporate the large internal IT costs of any project. Physical servers, software, integration into the network environment, personnel and ongoing maintenance costs, all pay a heavy burden on the total cost of ownership a specialised reconciliation software will have when implemented. Modern trends dictate a move towards hosted solutions, offering retail companies the same functionality from existing solutions but without the heavy cost of data storage and infrastructure cost. New web-based solutions allow companies to access their solutions globally with minimum IT overhead. Field-based auditors can access up to the minute information pertaining to a particular store or supplier. External audit can access company’s reconciliation process information, further reducing the cost of time spent with the organisations staff. The introduction of web-based, hosted reconciliation services has maintained the finance functions drive to efficiency and operational control, while further reducing the costs of ownership of outmoded locally deployed reconciliation systems.
Many reconciliation software vendors have recognised the need to provide some level of ‘hosting’ as a service. Yet retail companies feel uncomfortable entering into partnership with vendors who operate data centres in conjunction with other organisations, or operate in unstable regions of the world. The hosted software model calls for a more trusted relationship between supplier and customer. New participants in the market, such as London Stock Exchange Group, with it’s UnaVista solution, now offer retail companies the best of all worlds - "best in class" reconciliation software, with up to date web access, and with the added extra of the unrivalled security that the Exchange can offer. UnaVista is not just capable of managing the demands of standard retail reconciliation requirements, but also integrating workflow and dashboard style reporting, taking practices such as balance sheet control and supplier statements, and providing new methods of risk mitigation, audit and control around what is historically regarded as a paper based manual process.
London Stock Exchange Group has a long history of providing quality hosted solutions to thousands of organisations across the globe, coupled with its strictly regulated infrastructure and trusted environment, the Exchange is firmly positioned to address all the concerns that retail organisations have concerning hosted reconciliation solutions.
Historically, the best reconciliation and exception management solutions would be ones which provide a blend between cost reduction, business control and risk mitigation. Now with deeper scrutiny over costs and business looking to increase efficiencies further, organisations are looking at other areas where they can gain advantages, including hosted and web based solutions. In addition, uncertain markets lead to risk adverse strategies towards vendors, and institutions are well positioned to fulfil this problem, becoming both supplier and trusted partners.