Why are we seeing a trend toward rising IT costs?

Here are some real-life cause and effect scenarios that drive the cost of technology:

Cause #1: Capacity of data placed on hardware doubles every 2 years (Moore’s Law).
Effect #1: Increased efficiencies drive price down.

Cause #2: Computing demand doubles every 5 years.
Effect #2: Demand goes up, price goes up.

Inevitably, these cause and effect relationships counteract any cost savings from increased efficiency.

Not to mention, although the unit cost for storage is dropping in today’s technology age (for example, Amazon lowered the pricing of their S3 storage platform in February), the amount of data we are storing is increasing (by about 45% a year!).  We are becoming more and more of a digital data-generating society, with more and more avenues for data to flow in and out of.  Just think of the recent explosions of mobile device and web-based data, not to mention the billions of pieces of data being collected through every digital interaction that we don’t even think about.

The only way to beat the rising cost of storing data is to manage your data, put policies in place, and don’t forget to do your annual data spring cleaning.

Read more here: http://www.wallstreetandtech.com/it-infrastructure/232900225

Don’t do it! 

NEVER use your work account password for any external sites (gmail, hotmail, facebook, twitter, etc.).  There have been many reports of google accounts being hacked recently, and if your work account has the same password, there could be a LOT more at stake than just your personal information. 

Make sure your work account password is unique and secure.  At Xcentric, we require that users change their login password every 90 days based on the following set of complexity requirements:

• Password may not contain all or part of the user’s account name
• Password must be at least 8 characters in length
• Password must contain characters from 3 of the following 4 categories:
  1 – English uppercase characters (A through Z)
  2 – English lowercase characters (a through z)
  3 – Base 10 digits (0 through 9)
  4 – Non-alphabetic characters (!, $, #, %, etc.)

Basically, with today’s technology, it’s only a matter of time before a hacker runs through all of the password possibilities for a given number of characters- or gets shut down trying.  That’s why making sure your passwords are strong enough is so critical (read more: How Secure Is Your Password?).

And, while you’re at it, if you haven’t changed your personal account passwords recently, we’d highly recommend it.  Just make sure you use something other than your work account password.  We’d also recommend setting up the 2-step verification for your Gmail or Google Apps account as well.  It just takes a few minutes and adds some extra protection to your account.

If you’re tired of trying to keep up with passwords for everything, there are web-based password managers that will keep track of your passwords for you (like LastPass).  Here’s a LastPass review from our blog.

The good news is that for firms that have traditionally had a good physical document retention policy and have educated users on its requirements, the transition to include digital files in the mix is fairly straightforward as long as policies are reviewed and updated annually. Firms that have not done so well may be facing a momentous cleanup of old physical and newer digital files to comply with a digital document retention policy, but this transition should be a business requirement in today’s litigious environment.

Start at the Top

The first step to success is getting management onboard, ensuring that they all understand that document management and retention are business initiatives that are not only required (given their fiduciary responsibility to protect firm data), but are also critical components in improving firm efficiencies through paperless processes, as well as possibly protecting the firm in the event of any future litigation. Once the owners are onboard, the process (and cost) to develop and update the policy, get existing files in compliance, and educate users can begin.

To develop a policy, the firm should focus on which documents should be kept and for how long. The initial creation can be streamlined by reviewing the AICPA e-MAP: Management of an Accounting Practice Handbook or consulting guidelines provided by the firm’s professional liability insurance carrier. In many cases, local statutory requirements dictate the retention period, so firms should discuss the initial policy with legal council to verify state requirements for tax files, audit and accounting documents and even administrative files, such as the firm’s financial records and personnel files kept by human resources.

The firm should next educate personnel on the policy and on what files should be kept and how they should be kept. While many firms have used Windows Explorer for organizing files on their network, documents can be easily overwritten and deleted, so firms that are serious about document retention develop procedures to adhere to the firm policy and implement tools such as document management and engagement binder systems to manage the policy. Today’s tax and audit binder applications can be locked down with an audit trail to limit access to authorized users, but most firms are adopting document management (DM) systems that are more robust and secure. DM systems are more effective at forcing firms to adhere to a retention policy as document profiles can default to a destruction date and flag a file for deletion based on the type of document and the firm’s retention policy. At the same time, firms with DM systems must review and clean up existing digital documents previously stored electronically in the old locations to ensure that they also adhere to the policy.

Points to Consider in Updates

Firms should review policies annually to ensure they take into account new legal requirements (existing laws to consider include the Sarbanes-Oxley Act and the Health Insurance Portability and Accountability Act) and the various evolving ways that files are stored digitally. In addition to traditional tax and accounting documents created for client work, there are five areas that should be considered when updating the firm’s retention policies:

1. Offline storage. While all documents should be stored on the firm’s network, network access may not always be available when a document is created (such as when auditors in the field are storing files on the local C: hard drive) or the document may be provided on a USB flash drive or even through a third party web portal. Firms should require users to move the data to the network and delete local copies once this has been done and verified. (Even today’s smart phones and tablets have local storage capability that some people may use to store client data, so the firm’s policy should incorporate them as well).
2. Email. Many team members use their email as an archival tool and never delete anything, which often comes back to haunt the firm. Retention policies should apply to email and other digital communications. Many firms mandate that all emails of importance on an engagement be saved within their engagement binder or DM system. The retention policy can then be forced on email accounts, automatically deleting all emails (including those in the deleted and sent files) once that email has hit the specified deletion date, which is often between 30 and 180 days.
3. Unified messaging. Computer telephony integration can deliver voicemail and digital faxes through the firm’s email program, allowing information that could have a material impact on a client engagement to be saved as part of the engagement file in alignment with the firm’s retention policy. Firm members should be trained on standard naming conventions for these files and which file (correspondence) should be saved within the engagement directories.
4. Video calling. Video calling (such as Skype, FaceTime and Oovoo) is becoming more common with clients, and firms can now capture digital versions of these conversations as a record of client requests, change orders or acknowledgements. These digital versions should be included in the firm’s retention policy (and the client notified when live conversations are recorded).
5. Decommissioned equipment. As firms get rid of old equipment that was used to store data (backup tapes, flash drives, computer hard drives), it is important to document that those devices and media were appropriately “scrubbed” of all client data so the firm is not  embarrassed by accidental “discoveries.” Once all manual and digital files are identified and organized, a retention policy adopted and employees educated, it is important that firm members adhere to the policy. This doesn’t simply involve placing documents into the system but should also include a standardized process to purge files that are no longer needed according to the firm’s policy. Today’s document management systems can create a list of all files stored within the system and a list of files scheduled for deletion, which can then only be deleted by an authorized person. The system should document the approval of the deletion request as well as the list of files deleted. The policy should outline how the firm will notify the client that their files will be deleted, how much time clients have before the file is deleted and how clients can access the document or a digital copy. This should all be outlined in the firm’s initial engagement letter to the client, so there are no surprises.

Good Business Sense

Implementing a digital document retention policy makes good business sense for firms since it can streamline production processes and protect the firm in the event of litigation. It is important that firms regularly review the policy and adherence to it, as well as educate end users to protect the firm in the long run.

This article was originally published for the American Institute of Certified Public Accountants.

Thanks to our smart phones (along with tablets, other hand helds, etc.) the modern man no longer has to fret with nothing to do. There is always an app close by, another email to read, a bill to pay, an Angry Bird to save, and the list goes on and on with what’s at your fingertips. While there is much to be thankful for about the ‘productivity’ in our hands, there is also something to worry about – the demise of boredom.

Boredom, as I see it, is free space to think, wonder, and roam the world between your ears. I do not define boredom as having nothing to do, but rather having everything to do. I believe the individual needs this time for overall health, sanity, and clarity. Humans have always had a component of boredom in their lives, but only recently have we had an option to opt out of being bored. I would argue that our minds are not able to handle the current degree of stimulation that we face day in day out, thus depleting our overall ability to be creative, strategic, thoughtful, engaged, and so on. If our brains were likened to a city’s infrastructure, I’d say there is too much traffic – thus smog, wrecks, and the general annoyance that comes from traffic is pervasive in our brains.

So getting back to the title of the post, dumbing down our smart phones (I could say “smart devices” but it doesn’t have the same punch) is our ability to know when to say “when” and limit our ability to rid our lives of boredom. We need to recognize boredom as a central tenet that allows other mental ascents to bloom.

What are some ideas on how to do this?

This, of course, depends on your personality, so below is what I have found suits me best. My guess is you won’t like it. Neither did I….at first.

Limit yourself to 2 pages/screens of applications
You and I both know that you pretty much use the same apps over and over. Some of these get you out of a jam and some of the others you have on there just because they came on the phone or for novelty’s sake. Get rid of the apps you don’t use or that are simply a novelty.

Turn off YouTube
Yes, I said it. It’s like having America’s Funniest Home Videos in your pocket – and while this may make you laugh it doesn’t make you a better human being and/or more productive.  For some reason I always find myself watching soccer highlights – not ones from last night, but amazing plays. I don’t play soccer, I don’t care about soccer, and if you have seen me try to play, it’s a joke. Simply put, it’s a waste of time. 

Games, really? Grow up!
Games are the ultimate enemy of boredom. It’s all novelty…if you argue with me on this, it’s going to be laughable logically so just save your breath.  There is no point besides ‘vegging’ and escapism. Angry birds, Words With Friends, Flick Home Run, all of them are dulling you as an individual.

News no more (on your phone/device, that is)
When was the last time you read the news? Did you go about your day any differently because of what you read? The information is largely un-actionable, thus to keep checking the news on your phone/device is meaningless to your day’s productivity. Yes ‘news’ has an aspect of value, but I am sure you will be fine without it on your phone.

Last but not least…shut down your BROWSER!
Gasp. Breath. Breath.
You mean to tell me after you sit on your computer for roughly 8+ hours a day you ‘need’ a browser on your device? If you live in B.R.I.C. (Brazil, Russia, India, China) this does not apply to you. However in the states, aren’t you tired of being on the web? I know it can seem that being at your 5 year old kid’s soccer game or stuck at your spouse’s 3rd cousin’s house for a once a decade dinner is not as fun as checking your neighbor’s Facebook page from your phone, but take a break. Chill.

So how do I dumb down my SmartPhone? Use Restrictions.
Have a friend/spouse/co-worker lock the parts of your phone that you deem a waste of your time. This just makes sense due to the ‘present bias’ we have towards immediate pleasure, which, in this case, means curing our boredom. Have them use a code (that they won’t forget) to unlock the phone when you need to run updates, download a new business app, etc. Immediately have them lock it back and thank them for doing so.

How does a VDI work?

To virtualize a desktop, an enterprise must make their desktop environments configurable, deployable and manageable from a central location. All VDI deployments start with provisioning a desktop to an end user, whether it be a physical or virtual desktop. The next step is to install a piece of software, called an agent, on top of the desktop, which will enable access to the virtual desktop. Each VDI vendor has a different protocol for how the communication takes place to gain access to the virtual desktop. Once enabled, the thin client desktop connects to a configured user disc image in either a shared or persistent desktop and a broker determines who gets access to what desktop. The connection broker is similar to a mortgage broker for business loans in that it lies at the heart of any functioning VDI. A broker ties all the pieces of VDI together and makes the decision as to who can access what data and how. How do shared and persistent desktop configurations differ? Let’s take a look.

When a shared desktop environment is created, it meets the needs of all end users and an image is shared across the organization. This works best in an enterprise environment where common applications meet the needs of task workers inside the organization. Xcentric uses this concept when provisioning servers and it can also be applied to shared desktop virtualization.

If you have anything that deviates from the shared desktop environment, where one or more shared images don’t meet all the needs of your end user, then you have to introduce what is called application virtualization. This is where applications are streamed, run into an isolated environment, and show up for a single user. Basically, a custom fit or a one-off.

Whether or not a CPA firm is a good fit for VDI depends on the firm’s environment. Applications drive all of this and user environment management is an important aspect to evaluate. If you have a shared desktop and need to personalize it, the question becomes how to persist the data. Persistent data structure is where the previous version of the data is modified while maintaining the previous version. There are companies that specialize in customization of user data, such as RES Software, Unidesk, and App Sense. These companies persist user environments by personalizing desktops and delivering the applications that each user requires to work. This is another technology that fits inside the concept of VDI, called a persistent desktop. In the case of a persistent desktop there is a one-to-one mapping of a desktop to a user, meaning, each user gets a unique desktop image that must be maintained and managed by the broker. With this method, all of the data from every unique desktop must be stored, which necessitates much larger storage requirements. Ultimately, the available options are shared desktop, persistent desktop, or marrying the two with what is called application virtualization.

What are some VDI scenarios?

Scenario 1: A business gives each employee a desktop with a VDI agent installed on the desktop so that employees can connect remotely; similar to GoToMyPC.
Scenario 2: Start out with a hypervisor (either VMware, Citrix, or Microsoft Hyper-V) and give people remote access to a virtualized desktop. This way the hardware stays centralized while the desktop becomes virtual.
Scenario 3: Using Citrix, the client can install a hypervisor on a laptop, which can react to things like wireless and closing the lid.

If not VDI, then what?

1) Terminal services environment. Functional and mature; we use it here at Xcentric.
2) Traditional desktop. With this option, application virtualization can also be used and the OS doesn’t need to be virtualized.
3) Kaviza. This is more for the SMB market; however, Citrix just bought a Kaviza solution, which is an appliance that users can connect to for their desktops without needing all shared storage or user provisioning; just add more appliances as you grow; need a bunch if you are a really big environment. They use HDX as their remoting protocol.

Xcentric has not pursued VDI on a couple of accounts:
1) There is no Microsoft Service Provider License Agreement (SPLA) for VDI – meaning we would have to purchase perpetual desktop licenses along with service agreement for each desktop license. This alone would break the bank.
2) User density with Terminal Services-based solutions (i.e. Citrix XenApp) is much greater than desktop virtualization. With VDI, we would have to quadruple the amount of hardware we have today to support the same amount of users. Note- this quadruple statement is true for us in a remote disconnected data center environment and may not apply to everyone.

It turns out a lot of companies that have tried to go down the VDI route are putting on the brakes beyond pilots. People have become disillusioned by what VDI will do. For instance, VDI is not always a cost savings. In the case of persistent desktops, there are hidden storage costs because you are creating a unique user profile and storing the data for each end user. Input/Output Operations Per Second (IOPS) are used as a performance measurement to find the best storage configuration. Setting expectations on network capabilities and storage costs is a must.

Conclusion

Final say: there is no definite answer on VDI, as the answer is unique to every firm. VDI is not a one size fits all solution. For instance, VDI is an easier fit in the education, manufacturing, and medical arenas because these are more task driven environments. Similarly, VDI may be a “slam dunk” for a niche function inside a CPA enterprise but may not be across the entire organization. If VDI is something you want to consider, we recommend considering real-life cases that have worked for other CPA firms in the past. The more facts you have, the better you are to make a decision.

Sources:
Special thanks to Jason Conger for his input on this article.

“The State of Emerging SMB Hardware Trends: 2008 to 2009” Frank Gillett. May 29,2009. B2B Market Research Professionals.

“Virtual Desktops are Hot Again” Gary Orenstein. July 25, 2010.

Virtual desktop infrastructure (VDI) is a hyped term in the technology market right now. Unfortunately, the term has really become ambiguous, as VDI is more so a concept than a technology. VDI actually encompasses a suite of different technologies; therefore, it is important to distinguish between what is being delivered and how it is set up. In this blog, we’ll attempt to define the what and who of VDI.

What is VDI from a high-level perspective?

The industry has had a hard time defining terms. Virtual Desktop Infrastructure (VDI) is an umbrella term for many technologies put together. As a concept, VDI delivers desktops, applications, operating systems, and data to end users. VDI generally encompasses desktop virtualization, which separates the PC desktop from a physical machine, but you can have desktop virtualization without VDI. For example, a published terminal services desktop is also considered desktop virtualization; however, VDI is generally associated with hosted virtual desktops (HVDs), while a published terminal services desktop is associated with Server Based Computing (SBC), two very different technologies.

There are companies that perform remote desktop solutions on a 1 to 1 basis and call it VDI. For instance, if someone were to deploy a 1,500 user device, it would take 1,500 pieces of hardware to deploy. In this case, no virtualization actually takes places because they are accessing a physical desktop. Although, this is technically a form of VDI, it’s a very clunky one. VDI can be optimized in a ratio like 1000 to 1 instead. That is, where you have 1000 users using thin clients that give them access to a single virtualized desktop. A thin client is when someone is using a computer that relies heavily on another server or computer. In this case, you don’t need a physical desktop for each remote desktop.

Who are the main vendors?

A hypervisor is a foundational layer that virtualizes the desktop. There are three main vendors that provide hypervisors to the VDI market: VMware, Citrix and Microsoft. VMware offers what is called VMware view. VMware view allows you to customize the desktop by virtualizing and delivering a single image model where a gold master is used for a base image of the desktops. The base operating system and applications are the same so that a single image is rolled out to all users. Citrix has a similar structure called XenDesktop with the HDX protocol and Microsoft offers Hyper-V with the RDP protocol.

Stay tuned for the end of the story behind VDI (part 2) as we will cover the scope of VDI, discuss scenarios that have and haven’t worked, evaluate the benefits of moving to VDI for a CPA firm, and finally address Xcentric’s stance towards VDI.

Special thanks to Jason Conger for his input on this article.

Cost of the Cloud

The fact is you have a limited amount of resources— time, money, people, equipment— and the way you allocate these resources speaks to your priorities as a firm. In addition, understanding the true cost of IT is no easy endeavor, thus many firms, given their resources, are unable to consider the full picture.

The opportunity cost of Cloud adoption may be that you decide to free your IT staff from doing updates and place them on more strategic initiatives instead; or enabling your auditors who work in the field to access their applications wherever there is an internet connection; or no longer being in the business of owning servers; the list goes on. Keep in mind that the cost of adopting the Cloud is also the cost of not adopting the Cloud.

Questions Related to Cost:

• How is budget/cash flow impacted by an operational IT budget expense versus a capital expenditure based budget?
• What is the cost of an on-premise implementation versus a Cloud implementation?
• How does moving to the Cloud impact your spend on disaster recovery?
• What is the total technology spend per FTE annually over 3 years? How will the Cloud impact this?
  • Include: all software, IT staff salaries, 3rd party consulting spend, DR, etc.
• How much time are partners and staff spending on technology administration? How will the Cloud impact this?
  • Include: software updates, vendor management time, planning, committee meetings, issue resolution, etc.
• How does each scenario scale and how does that impact cost accordingly?
• What’s your current internet bill? How is that impacted in the Cloud? (link to blog with thoughts on internet)

Organizational Change in the Cloud

Changing how and in what capacity people work across an organization is not easy. Is the culture of your firm prepared to adapt to the Cloud?

Questions Related to Organization Change:

• What is the firm’s view of remote workers and/or working from home? (the Cloud will require the firm to address this policy)
• How will the Cloud impact our other locations?
• What routine tasks will be impacted by the Cloud? Will certain aspects create more or less work for individuals?
• How will our employees be trained on the new platform?
• How will being in the Cloud impact how we do audits? What does connectivity in the field look like?
• Would overall system performance be improved in the Cloud?
• What impact (if any) does the Cloud have on our phone system?

Stakeholder Impact in the Cloud

The Cloud affects your organization at all levels but perhaps none more so than the partners given the P&L factor.

Questions for Stakeholders/Partners

• How will the Cloud impact our staffing levels?
• Will the Cloud impact my peace of mind?
• Does this fit our business objectives over the next 5-10 years?
• Does the Cloud vendor know our business model and our core applications?
• How will this make me more money?

It can feel daunting to jump into the deep end and trust a vendor with a key aspect of your firm. Brenna, and her firm, did so when it came to their technology. Here is a brief Q-A session on how the Xcentric Cloud has impacted the firm in the first few months (and one busy season) at the firm.

Name: Brenna Olwine

Postion: IT Coordinator

Major Software Applications: CCH, Caseware, XCM, BNA

Firm Size: 45

Offices: 1

How many hours a week do you work?: 24

How many years have you been in the Xcentric Cloud: 1

How is Xcentric different than your past technology provider/s?:

Xcentric is much more hands-on, more responsive and more knowledgeable!

What did your role look like before the Xcentric cloud?

Before Xcentric, I did almost all of our updates, as well as fixing many problems on the production and Citrix servers.  Users would call me daily because they were hung up in a certain application, or their entire session was frozen and I would have to log onto the Citrix server and kill their app or session.

What does it look like now?

I can now concentrate more on looking to the future of our applications, learning more about security and spending more time maintaining our workstations and devices.

How was your first busy season in the cloud?

Great!  We had absolutely no down time, and only a few occasions where the entire network slowed down.  Everyone was happy with the updates schedule, and updates were applied in a timely fashion.  Of course, we had a few issues, but less than were expected, having an entirely new network and new support.  Overall, it was a very successful tax season, from the IT stand-point.

How was the conversion to the cloud?

Incredibly smooth.  I volunteered to come in that weekend and do a lot of things, such as remove our existing anti-virus, so that when Xcentric arrived there would be less to do.  The team that was onsite for two weeks was wonderful.  They fixed/updated/added anything I asked for, and spent time looking for solutions to some of our more unique requests.

How do you work with Xcentric on a day to day basis?

Sometimes I email support to open a ticket, sometimes I talk to one our the reps that are assigned to our account.  Very rarely do I call to resolve an issue.  Every day I open the Client Support Portal to see what tickets are open firm-wide and the status of them.

How has the Xcentric Cloud impacted you personally?

I feel more secure in my job knowing that IT issues are going to be resolved!  When I leave the office, I don’t feel like I am taking work with me; the likelihood of a user calling me with an IT problem is greatly reduced.

Reward yourself after a hardworking tax season by upgrading your laptops, desktops, monitors, and printers. 

We are excited to announce the newest addition to Xcentric Store: printers!  We have added 3 printers that are fast, multi-function, black and white, and color. These printers range in size from personal desktop to large office. 

We selected Lexmark printers for multiple reasons:

1) Lexmark printers are certified with Citrix, making them compatible with Xcentric Cloud.
2) Lexmark is a leader in their industry by creating products and standards such as dual head scanners and new printing units that other companies are copying.
3) Xcentric tested Lexmark extensively through printing 500 pages, across multiple clients, locations and applications.
4) Setup service, unpacking, and installation are included in the price.

Xcentric Store was created with the intent to make your hardware purchases simpler. Through a due diligence process, Xcentric identified the laptops, desktop, monitors, and printers that would best suit the needs of accountants. We listened to the requests of our clients and have responded.

Xcentric supports all the hardware represented on Xcentric Store by using it in our offices. We have created a process through the store that makes purchasing and configuration convenient for our clients. We understand that your computer is the lifeblood of your work; therefore, we offer a service that will ship your computer already configured for Xcentric Cloud. Visit us at http://store.xcentric.com/ and if you have any further questions contact jhull@xcentric.com. We are here to help!

Did you know that the early wooden printing press could produce up to 4-5 impressions per minute? A printer in our day can produce anywhere between 40-50 impressions per minute. The invention of a German from Mainz forever changed mass production of printed materials. His invention created an economically viable system that allowed for content to be dissimilated across the globe. Thanks, Johannes, for your innovation!

We’re kicking off event season in May with the BDO Conference in Las Vegas.  Then we’ll  head to the AAA Technology Fly-In in Detroit and the PKF Firm Management Conference in Palm Beach, FL.

In June, we’ll be at the McGladrey Spring Roundtables, AICPA Tech+ (here’s a special registration discount) and the AAA Conference in Las Vegas, as well as the Enterprise Worldwide Symposium in Chicago and the Montana Society and AWSCPA Conferences in Bozeman and Salt Lake City respectively.

Here’s a full listing of our upcoming events.  Let us know if you’re planning to be at any of these events- we’d love to connect with you while we’re there.  Hope to see you soon!