Why Xero shouldn’t be the most important program in your business

Cloud programs

Let me get this off to the right start, Yes I am an accountant and Yes I do recommend that my clients use Xero because I believe that it is currently the best accounting product on the market. But what I want to emphasize today is that businesses sign up to Xero, and because it has so many features and provides so many options it becomes their sole focus for all their processes and reporting.

Because of the way the world has gone with automation and technology, business was sure to follow. Xero has generously provided its software up on a platter for savvy developers to integrate their own innovative ideas and there is now a marketplace for these where you can compare them against each other for price and functionality. Not every add-on will solve every problem in your business but the right tool for the job should do a pretty good job.

Once you have integrated this add-on into your business processes it needs to become the centre of your business. I mean that’s why you got it? To run your business. Problems arise when your advisor starts to advise on the performance of your business from the data in Xero rather than focusing on the data that is important to your business which is contained in the add-on. And it is for this very reason why I say that Xero is not the most important program in your business.

If you are running a café and are using a POS system such as Vend or Kounta, can Xero tell you what your product mix is? Or what your best performing product is? If you are in trade and you use Service M8 or GeoOp, can Xero tell you the average time that it took to complete a certain task or job? Can it tell you your service history in a certain suburb or demographic?

The answer to these questions are no because Xero has a different role and function to add-on that you use to run your business. So to a business owner who uses an add-on, this add-on needs to be the most important and up to date data that you have so that you can make effective business decisions based on true, live, intelligent data. The information in Xero will fall in line with that which you put into the add-on purely through integration.

So if it’s not the most important, where does Xero fit in then? Xero becomes the hub to tell you the performance and position of your business for which it was intended. It gives you the financial data such as liquidity, cash flow, GST payable, debt to equity, and Return on Investment ratios for example. This data is no less important than that contained in the add-on but the data has taken on a completely new role because you have taken control of the flow of information in the add-on.

As Trusted Advisors (Traveller Guides) at Errant Venture we focus on making sure that our clients business run as effective and efficiently as possible. We make it our business to know your business and to go on that journey with you.