Dear Reader,

If your young business is like the majority of Venture Momentum's clients, product development and sales are a top priority, but IT infrastructure is not. As soon as you open a bank account and start paying some bills, you’ll need someone to manage your accounting/finance operation. Whether this person is a bookkeeper, office manager, accountant, controller, or CFO, more often than not you’ll be dealing with a consultant or contractor. They’ll be working on and off premises, and to ensure an adequate level of service, continuity and quality, they’ll need easy access to your financial data. If you don’t have a company server setup with a secure VPN (Virtual Private Network), chances are your consultant will need to carry your financial data around on their laptop. Sound familiar?

So what’s wrong with this picture?

Here are 3 reasons why this is not a good idea:

1. Consultants come and go. What if you terminate the relationship with your financial consultant or something unfortunate happens to them? Can you ensure that you’ll be able to recover your data in a timely manner so that you can pass it on to the next consultant?
    
2. Is your consultant treating your financial data with the same degree of care that you expect them to? What if your financial data is not protected adequately from the standpoint of data retention, disaster recovery, security, and privacy? Your consultant’s hard disk may fail; their laptop may be stolen; and they may not have backed-up their data regularly. Can you afford such an exposure?
    
3. You’re at a Board meeting and you need access to the most current version of your financial data immediately. Unfortunately, the files you have are a month old because that’s when you last synchronized them with your financial consultant’s database. Your Board will probably suggest that you need to do something about improving your data collaboration process.

What to do?

There are web services that allow you to purchase a hosted drive that’s accessible online. You can store your company files on this online drive and enable various contributors to your financial organization—employees and consultants alike—to create, maintain and access, through a high speed internet connection, whatever financial data you deem appropriate for them anytime, anywhere. It’s as simple as it sounds. And it’s inexpensive to implement too.

For this approach to work, the hosted solution must offer a file-locking feature so when a user is working on a file, other users can open the same file in a read-only mode, but can’t modify it. Otherwise you run the risk of having serious synchronization problems when the same file is updated simultaneously by multiple users. It’s also important to pick a solution that offers a friendly user interface (such as a windows-like interface) so users can easily create and navigate folders and files without having to adjust to a new mode of operation.

When I asked my long time friend and IT expert Dennis Pasadis, president of Innovative Solutions, if he could recommend a reliable online backup solution, he suggested I try ibackup. Since I discovered the ibackup drive I’ve been referring Venture Momentum clients to it. Once a client is converted, various members of their finance team can collaborate, virtually, on the same financial data.

Just a few days ago, I was traveling 8,000 miles away from home and needed to look at one of my client’s financial data. I simply logged on to their account on ibackup, brought up their entire virtual finance server on my screen, and was able to respond to their inquiry based on their most current data. Pretty powerful tool, don’t you think?

Things to watch for

ibackup drive is a basic solution that serves basic needs for a reasonable price. There are certainly other solutions out there and they all have their advantages and disadvantages. ibackup may not be the right solution for you and there could be compatibility issues depending on the operating system you’re using. You may also face other issues related to navigation and timeout while logged on to your account. Fortunately, you can test drive it for 15 days and evaluate the pros and cons prior to making a final decision. It’s also a good idea to take a look at other solutions available on the market and compare them before converting.

For ibackup to work, you must require your financial consultant to work exclusively on the online storage facility. If they continue to work on and store your company’s files on their local drive, that would defeat the purpose of this procedure. Also, for the file locking feature to work on ibackup drive, every user must log in to the hosted drive using a facility called webfolders within ibackup.

Note that storing your financial data online does not necessarily ensure adequate backup. For Venture Momentum’s clients, backup of the data stored online is performed on at least one local USB drive, which is then stored in a safe location. Data can then be restored in the event the online storage facility fails for any reason. The frequency of backups will depend on how often the data is updated.

I cannot recommend you work on a QuickBooks database file from a hosted drive. I have not put this concept to a comprehensive test, but my limited experience with this particular situation has been far from positive given the requirements of the QuickBooks application and the large size of its database files.

Finally, one could expand the above approach to other functions in the organization, such as corporate records, sales, marketing, facilities and others. In this case, you’ll need to implement the proper permissions in order to limit user access to those areas that pertain to their job function.

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