Written by Jonathan Gaunt, co-founder of both Xavier Analytics (now Dext Precision) and Socket, as well as FD Works, an award-winning accountancy firm established 12 years ago.
A Single Version of the Truth: How Getting it Right Can Transform Your Business
In today's fast-paced world, maintaining accurate and consistent data is crucial, especially for accountants and bookkeepers. A single version of the truth (SVOT) can be the key to transforming how data is handled, leading to better decision-making and operational efficiency. But what exactly is a SVOT, and how can it reshape your practice?
What is a Single Version of the Truth?
SVOT refers to the practice of consolidating data from various sources into one accurate and authoritative source that everyone relies on. Whether you're managing financial records, client details, or sales invoices, ensuring that everyone accesses the same dataset means fewer errors, miscommunications, and confusion.
Is it the Holy Grail?
Well, we've nailed it when it comes to accounting records. We have tools like Xero that use bank feeds as a source of information and an open API which allows systems to talk. Where we know there might be issues, as accountants and bookkeepers we put in place control accounts to enable us to keep track of the difference.
When that single source is maintained and trusted, all decisions can stem from the same foundation, improving the accuracy and consistency of your operations.
Okay, so there are instances where we sometimes get it wrong. Did you post that journal with the year-end adjustments? Did you update the director's change of details? Intentionally working towards your SVOT takes time but will bring huge benefits in the long run.
The Benefits of a Single Version of the Truth
A SVOT can have a profound effect on data quality, streamlining workflows, and reducing the need for duplicate work.
Improved Data Quality
With only one version of the truth, errors caused by manual duplication or discrepancies between datasets are minimised. This enhances the overall integrity of your data, leading to more accurate reporting, communication, and compliance. Basic mistakes like addressing a client using their old company name or referring to a previous company address may seem minor but appear unprofessional to the client.
Efficiency Gains and Consistency
When everyone knows where to look for the most up-to-date and accurate information, it saves time and prevents mistakes. No more cross-checking multiple systems or files; the focus shifts to managing just one source of data, which drives consistency across the organisation.
Why does everything come back to data quality? [Edit: I co-founded Xavier Analytics, which later became Dext Precision, in a bid to improve data quality within the industry]
The Challenge of Maintaining a Single Version of the Truth
Despite the benefits, maintaining a SVOT is not without its challenges.
Data is like a river—if you change something at the source, everything downstream is updated. But if you make changes midway, earlier data could be missed, creating inconsistencies further downstream.
In the accounting and bookkeeping world, the challenge is compounded by the use of multiple systems, APIs, and one-way data flows. Even though many businesses have embraced cloud-based technology, syncing between systems is not always perfect.
APIs and Syncing
APIs help data flow between systems, but in many cases, the sync is one-way - it's how tools like Zapier and Make work. At a point in time the data was right. When it comes to updating that system, which system do you update? Was it a one-time sync? Did you only update the downstream systems? It can be a minefield, leading to discrepancies when changes are made in the wrong system or when updates are forgotten, creating gaps between the different datasets over time.
The temptation to store information in multiple places often leads to unnecessary complexity. Instead, should we be reducing the number of places data is stored and focusing on keeping information updated in the single, gold-standard source?
Take Companies House as an example - it's got a simple API, why do we choose to maintain our own records? Why don't we instead look straight to Companies House and if the information is incorrect, the goal should be to change it at the source rather than working with outdated data in multiple places? This relies on everyone understanding where that source of truth is and ensuring proper signposting and a change in behaviours.
Behavioural Challenges and the Human Factor
But let's face it—changing behaviours is hard. Even with the best intentions, when we're in a rush, we often update the wrong system or forget to update the primary source altogether. I've even seen people revert to maintaining post-it notes to keep track of changes. Over time, this leads to a frustrating game of catch-up where we are left wondering why things aren't matching up months later.
How to start Maintaining a Single Version of the Truth
Is a Checklist the Answer?
When trying to change behaviours and ensure consistency, I'm reminded of a great book by Atul Gawande "The Checklist Manifesto: How to Get Things Right" which explores the importance of checklists in improving efficiency, performance, and reliability across various industries. Gawande, a surgeon, uses real-world examples from healthcare, aviation, construction, and business to demonstrate how simple checklists can prevent avoidable errors and save lives.
He argues that well-constructed checklists ensure that essential steps are not forgotten in complex environments. In aviation, for example, pilots rely on checklists to prevent disasters during emergencies.
Will checklists undermine the team's expertise? Gawande stresses that checklists support, rather than undermine, expertise by freeing mental energy to focus on more complex problems.
Begin with the Truth
We Can do Better
At Socket, we're shaking things up. We want you to have a Single Version of the Truth right from the very start, when it comes to proposals, pricing and creating invoices directly from Socket.
We're enabling you to make minor adjustments to a proposal, such as modifying a volume or adding a new service, midway through a client's billing cycle. Simply make the change, notify the client if you choose to, and the next billing run will automatically reflect this—no signature required and no need to update an invoice in another system.
For bulk changes, like price updates from a software vendor, we simplify the process. Just adjust the price, select the proposals you want to modify, and you’re done. We call this feature “Bulk Adjustments”.
Get this right and you'll unlock endless possibilities and reporting insights for your clients - this can lead to you being more profitable and save you time.
Maintaining a Single Version of the Truth isn't easy, but we're here to take on the challenge.
