Firms of all sizes want to provide the best services to their clients while running a tighter ship. To analyze the firm's data and help achieve these goals, many are turning to data mining tools and software systems."We had been seeking a program to assist us in analyzing and reviewing all the results of our practice. We were looking for something not really report-driven, but more on an analytical basis. Last December we approached a consultant to just write it for us, because up to that point [we felt] nothing existed," said Joyce Kalstein, assistant controller at the 75-person, Princeton, N.J.-based CPA firm The Mercadien Group. After reviewing a number of services, Kalstein said that her firm uncovered Dynamic Software Solutions International's eAnalytics Portal, and they couldn't be happier.
"Really, it's impressive," said Kalstein. "It really is state of the art, giving us the ability to manipulate and review and analyze literally any kind of data within our source program."
Data mining has about as many definitions as the phrase business intelligence - from a database application that hunts down patterns in a group of data to predict future behavior, to a tool with which a user can view specific figures within various company reports. Anyway you slice it, data mining gives the user a deeper look into the company's or firm's financial data, with the ability to view reports and figures that the user could not see with prior database applications.
Previously, only larger enterprises could afford to use costly data mining tools and systems running off of data warehouse database systems - systems that extract data from multiple data sources to present one coherent view of the company at one time. Today, however, more small and midsized firms and businesses are able to afford these analytical tools.
"They really dropped in price, and the [computer] infrastructure at smaller firms has gotten much greater. In the past, if you didn't have the infrastructure that these products ran off, meaning data warehouses, you couldn't use them," said Peter Kaufman, president of DSS International, a Miami-based Accpac reseller and data mining software developer. "They also didn't have database administrators to manage the large amounts of data and maintain their databases. Now these databases are close to being self-maintained, so it's pretty easy."
Many databases have moved from proprietary systems - in which only the provider's products work seamlessly together - to more open source systems, which use a standard server like SQL or Crystal Reports Server XI, so applications can be easily integrated with other providers' software. Many of these data mining systems are building on Microsoft's SQL Server to make the integration of their products to other vendors' practice management or time and billing software easier.
For example, if a CPA uses QuickPractice, QuickBooks' third-party practice management system from Long Island, N.Y.-based PracticePro Software System Inc., the only data mining tool it can integrate with is if Intuit or a partner of Intuit produces one. However, DSS International's eAnalytics Portal can connect to many Sage products, like CPAPractice Manager, as well as Microsoft enterprise resource planning applications like Great Plains. Pulled together into the data mining solution, the information can be viewed as a chart or a graph or in a spreadsheet format. The application can also be exported to Microsoft Excel, and some reports can move into PowerPoint.
"Before, everything was specific to each specific product -you might have an HR package, an accounting system, and a time and billing or manufacturing system. What would happen is that you would have three different reporting tools, one for each," said Kaufman. "Basically, today, [eAnalytics Portal] will pull into a common desktop reporting, with the same look and feel, all the data together, so it really enhances the user's experience."
FRx Software offers an open system for their FRx data mining and reporting product; however, they make the connection for their customers to their general ledger or practice management system, rather than having the customer find someone else to make the connection. As of today, FRx connects seamlessly with 50 different GL systems, including many Sage and Microsoft applications.
The well-known and widely used Crystal Reports works on the XBRL standard - a standard language that tags data, making it easier for applications like data mining tools to find the data and drag it over into their system.
"We're different than FRx or someone like that, because we publish XBRL - not just consume it," said Diane Mueller-Klingspor, senior product manager of enterprise reporting and XBRL and GL working group chair at Business Objects. "Using this industry standard allows for more transparency to compare apples to apples."
(Vice president of marketing for Microsoft FRx Andy Kamlet says that MS FRx does not "consume" XBRL, but rather supports and publishes the technology.)
One provider has taken these reporting tools and included them within their practice management software. Thomson's Creative Solutions in April released Practice CS with data mining capabilities. A user can choose from a number of preset reports and then change the variables to analyze a number of different processes or employees.
"With the idea of building practice management, we kept in mind allowing partners an in-depth look at the practice and the employees," said vice president of marketing Jack LaRue. "The software is easy to use, more cost-effective, and we got practice management integrated with our entire suite, which produces significant benefits and helps drive us deeper into the market."
Perhaps one of the most popular features within data mining tools are dashboards or scorecards. These graphically represented and financial-data-loaded snapshots of a firm or company allow CPAs and business executives to make decisions without needing to open up a report or search through spreadsheets. Within many dashboards, like the one within Practice CS, the user can click and drill down through details to see specifics regarding key performance indicators. Many are in real time as well, to give the user an up-to-the-minute look at what's happening within their company or firm.
However, David Cieslak, CPA, CITP and principal in the Calif.-based computer consulting firm Information Technology Group Inc., notes that many of the features within these data mining systems can be found, in much more basic fashion, within the tools of Microsoft Office - namely Excel. With pivot tables, graphs and spreadsheets and a light layer of online analytical protocol language - a reporting standard producing multi-dimensional reporting capabilities (think comparing billable time to a geographical area by employee) - users can develop their own data mining features.
"One challenge is not to get too carried away on hundreds of tools to report on parameters of a business or firm," said Cieslak. "First understand the fundamentals available in Microsoft Office. The additional tools are really just extending this tool set."
