Best Practices for a Stress-Free Fund Accounting System Implementation

You are done with juggling multiple spreadsheets just to track your restricted funds. You are finished with manual approval processes for expenses. You’ve made the decision to switch to a modern fund accounting system.

You’ve found the perfect partner. Now comes the part where all the planning and research pays off: implementation.

To do a fund accounting implementation process right, there is a good amount of organization, data clean-up, and training involved. But it doesn’t have to be stressful. The good news is that it’s possible to set up your nonprofit organization for success. With the right mindset and planning, you can organize and execute a seamless fund accounting software implementation that meets your needs—both for today and for the future. 

Mindset: A Critical Tool in Your Accounting System Implementation Toolbox 

Significant change requires significant preparation.  

Before getting into the details of rolling out new fund accounting software, focus on the big picture. Mindset matters. Envisioning the process from end-to-end allows those in charge of a system change to anticipate questions, concerns, and pain points from all team members and stakeholders affected by the new system. 

By approaching the process with a proactive mindset, implementation teams can set themselves up for a smooth transition by addressing potential hurdles and setting timeline expectations early. 

Avoiding Roadblocks

Coalescing every member of your organization around the same goals and expectations can help you avoid several common roadblocks before they get in the way of your implementation.  

Change anxiety and resistance: Learning a new system can be a tough sell for nonprofit professionals whose schedules are already packed with daily tasks. Show how the changes will make processes faster, more efficient, and more accurate—and have a positive impact on the whole organization.  

Limitations in current system design: If your organization has maxed out the capabilities of your current accounting system, it may be challenging to imagine what could be better. Encourage your team to move into positive “what if” thinking. 

Technology ecosystem and interaction: Your new fund accounting software will only be one part of your organization’s overall technology ecosystem. Ensure everyone understands how it will fit into and work with existing systems, processes, and job functions. 

Understanding the Timeline

Implementing a new fund accounting system typically requires time and effort from multiple parties. Articulating this to your team not only sets appropriate expectations, but also allows users to better understand the implementation process and get excited about new functionalities on the horizon.   

How long it takes to implement new fund accounting software will vary from one organization to another. Blackbaud’s consultants have managed implementations that were started and finished within a five-day workweek, but they’ve also overseen implementations that lasted nine months or more. 

For most organizations, the ideal fund accounting system implementation timeline is around 90 days, split more or less evenly among three phases: 

• Preparation and planning (days 1–30) 
• Configuration (days 30–60) 
• Testing and go-live (days 60–90) 

The biggest factors that affect timelines are the goals the organization is trying to accomplish and the number of stakeholders who need to have a voice in the conversation. 

As you set an implementation timeline, take into account that some phases—testing, in particular—require significant time from multiple team members while they are still performing their day-to-day responsibilities in the legacy system.  

Getting everyone on the same page in terms of goals and mindset will help avoid surprises later in the process. 

Preparation and Planning: Getting Your Fund Accounting System in Order 

This phase of implementation captures your nonprofit organization’s goals and paints a picture of how you want the software to function both on the day it goes live and several years down the road.  The more thorough you can be in the planning stage, the less likely you will feel any buyer’s remorse after implementation.

Once you have a clear understanding of what your organization hopes to accomplish by transitioning to a new fund accounting system, you can begin to make specific preparations involving the organization’s people and processes. 

Here are some key questions to ask: 

People

Understand how people on your team interact with the current system and ensure you’ve identified all applicable use cases.  

• Who will need access to the system or the data, and what level of access should they have? 
• Are the staff members who will use the software trained in nonprofit accounting? Are they comfortable using new tools?  
• What resources, training, and support will you and your team need through the implementation and beyond?  
• Who should be part of the implementation team?  

The size of your implementation team will vary by organization, but you should include a diverse set of roles. Bring in people who have a variety of experience levels, including those who are in the fund accounting system every day and who use the system once a month to view reports or submit an expense. The planning stage is also a great time to begin the training curriculum, so people know how to use the system when it comes time to test. 

Processes

The ability to articulate current processes and desired outcomes is essential when adopting a new system. It helps you identify and document changes in processes and workflow and will ensure your team is equipped for a smooth transition. 

• What is involved in your nonprofit organization’s end-to-end financial processes? Are these procedures documented, and do documents need updating? 
• What processes can be optimized to provide value and give people actionable data used to make strategic decisions? 
• How are financial reports compiled? 
• How is the existing system reconciled? 
• Is your organization consistent when it comes to naming conventions? 
• What data needs to be transferred from legacy systems? 

Go through each of your processes step-by-step to find room for improvement or reimagine better procedures. This is also the time to verify that processes are following good accounting practices. 

In addition to considering how your financial systems run today, think about what you will need three, five or 10 years into the future. You want to set up your new system in a way that will allow your organization to grow. 

This is all part of defining the scope of work. For it to be most effective, it’s crucial to document every aspect of the plan. Only with complete documentation will you be able to understand whether you met your goals and if the implementation was a success. 

Configuration and Testing: Creating the System You Need 

Many fund accounting systems offer users multiple ways to accomplish the same task. For that reason, a big part of designing and configuring your system is determining the best way to reflect your processes within the system. 

Use this opportunity to rethink the way your organization operates and imagine whether there could be a new way that works better for your team and your goals. Understand how your financial processes work with other software—such as a fundraising CRM—and what data needs to be shared between systems. Lean on your implementation consultant to learn how other organizations have tackled similar challenges. 

Your implementation team will help you create a mapping document, which specifies how accounts or funds in your old system will move into the new system. This is a great tool for uncovering gaps in your system design. Work on it throughout your planning process so that you can incorporate your findings into the final configuration. 

Once your system is fully configured, you and your team should test the new system as much as possible to ensure it’s working as intended. Look back at the documentation you created in the planning phase to understand whether the new environment is meeting the specified goals and requirements. 

If you’ve put in all the upfront work, then your actual go-live day may feel anticlimactic. Even so, take this opportunity to celebrate all the hard work and hours that went into the implementation! 

Looking Long-Term: Supporting Success Over Time 

With new fund accounting software in place, it’s now time to ensure everyone on the team has the training, resources, and time they need to learn the new system. 

In addition to training materials, your software vendor likely provides resources such as a user community or educational events where you can learn from subject matter experts and industry peers. Ask your consultant how you can suggest new product features and bring needs to their attention. 

And don’t let go of those scope documents just yet. Integrate any long-term goals you identified into your organization’s five-year plan, being sure to account for how your new software will need to scale as your nonprofit grows. 

For more tips and examples, download the free best practices guide for financial software implementations.