About FinSoft, LLC
BY: The entire FinSoft, LLC team
This White Paper will be updated periodically to reflect changes in technology.
Last revision Date: December 27, 2015
Copyright © 1996-2015 FinSoft, LLC - All Rights Reserved
While Asset Based Lending (ABL) survived without computers for almost 45+ years, the new year offers the choices and challenges of finding the right combination of hardware, software and report format to satisfy the quality requirements of management. This "White Paper" is written as an overview of the general hardware and operating systems available and then focuses on the software choices available to field examiner's.
NOTE: Things have Changed and this white paper was
started in 1996. Software is more than the ABL field exam report
because that now includes data analysis from client electronic reports.
Please note that a complete solution includes both field examination
software and data analysis software. Integration of the two is
even better. This White Paper has been split into different white
papers for Hardware and Software due to the expanded data software section.
HARDWARE (in brief)
Want to make a BIG MISTAKE? Order a 14" screen at 1280 X 800 or 1440 X 900 and you may just go blind. You will likely hear complaints from the staff about the tiny font sizes being displayed. It is a complete mismatch to go up in resolution and then down in screen size. Wide screen laptops at 16:9 are a mistake at less than 17" and that becomes a luggable, but not airplane friendly machine. Try this before you buy and avoid ALL widescreen laptops that are under 15.5" on the diagonal measurement. The native resolutions are important to consider because many of the available screen resolutions in the Windows screen properties look terrible, thus making a switch to a lower resolution somewhat problematic. As an example, our old IBMT60 laptop with a 14" screen runs fine at 1,400 X 1050, but 1024 X 768 seems to be overly large and grainy on the same screen. Our 22" monitors run at 1600 X 1050 and 1900 X 1050 and 1920 X 1080 look great. Other resolutions on that screen are out of focus and fonts tend to look squashed and distorted. Again, smaller wide-screen displays are not designed for business use, but they are indeed becoming more common. The future may require larger screens to compensate for this widescreen (anti-business user) madness.
Here are some of the common screen sizes:
If the ultimate portable is what you seek then you'll be squinting at the higher resolutions. 14" screens are a minimum since the resolutions have gone up. A 15" screen is a bit crisper at the higher resolutions and portable. 17" models look great but are tougher to lug around and not useful on an airplane, but most of us are at a desk with these so bigger is just better for the majority of time that you use it.
NOTE: Cheaper machines have shared graphics memory. This takes some conventional RAM (that 2GB to 4GB of main RAM) and uses it for video RAM. Not a good idea and these machines can be painfully slow. If you have one of these, then get more RAM (at least 4 Gig) and you'll see the speed pickup about 25%. Things are improving as the chip designs for laptop computers are optimizing the integrated graphics processors on the motherboard with much higher performance. Still, a dedicated graphics processor (discreet graphics) will provide less crashes and higher performance.
If you fly often, the 15" and larger screens will get jammed into your body when the forward passenger reclines, but you'll be better off when you are at a desk, which is much more of the time. Use the Ergonomics Act as an excuse to get a better screen. More pixels on the screen can increase both screen content displayed and eye strain on the smaller notebook displays. Our advice, stick with 1400 X 1050 or 1600 X 1050 or 1920 X 1080 display settings. Windows (particularly Win7 and Win10) also offers some larger font options for icons and web browsers.
Most of the new chips are duel core or better and this lets your virus scan run in on one processor while you work on the other. Six core and eight core machines are here if you want them. The competition between AMD and Intel has indeed made these all speed demons. You'll now see better utilization of the multiple cores in the software and most are now 64 bit processors.
Hard Drives - The biggest total cost?:
We switched to solid state drives (SSD) in 2010 because they are almost 50% faster, run cool and they have no moving parts. They are 100% Flash memory, just like those USB-key drives, but of course the controller to allocate the stored data is far more sophisticated and faster than a USB thumb drive. SSD technology prices are dropping and they are still 2X what a normal 2.5" drive costs, but they are worth the price because they don't crash and fail as often as spinning hard drives do. This up-front cost will be recouped from the cost savings of a replacement drive (although it may be covered by warranty) plus the lost hours at the staff level plus the IT cost to reimage the drive and then restore the data. In fact, this could reduce the IT needs considerably over the life of the laptop without the reimaging expenses that will occur all too frequently with spinning drives. We use 160GB-250GB SSD drives, but 128GB is more than enough for field exam business use where videos, pictures and other media are not stored. Our research noted that these SSD drives are good for about 20 years of use before they wear out and you do NOT defragment them because the data is spread out (leveled) on purpose to let the drive controller recoup bad bits of data into nearby memory addresses (cool!).
See security section below for comments on encryption for the hard drive.
Port Replicators and Docking stations have evolved into smaller port replicators. Toshiba uses one replicator across the entire line of computers and other are following that model (IBM has a similar "standard" replicator for many models such as the entire T-Series). Yes, you can plug in your mouse, your printer, your Ethernet cable and your power cord when you get into the office, but the replicators are easier to deal with on a recurring basis.
Windows-7 Ultimate and Enterprise (and Pro or Enterprise Windows-8. Windows-10) versions (the expensive versions) includes BitLocker encryption so that you can secure the entire drive and folders, including USB Thumb-Drives. Third party add-ons can do the same. The BitLocker type of technology prevents someone from hacking into any of the data on the drive, even if the boot from another operating system. This adds some cost to the Windows installation and it can be a bit of a hassle for examiners that MUST get data files from clients via e-mail or USB-Thumb drives.
Your IT Department:
Software installations are relatively easy and the headache of finding good drivers is virtually gone with since Windows 2000 came out. Most machines are running well out of the box and prior setup hassles are largely gone.
On The Cheap for the Self Employed (or for the really
In regard to speed, unless you develop software, routinely perform video editing or animated graphics, the speed issue for business has flattened out. Expect few benefits with super chips for business applications. Data analysis is another consideration, because more speed will make file analysis faster. If you develop software, download and parse lots of data like us, then faster is always better and the new i5 and i7 chips are a bit faster than the old stuff.
What Should You Buy?
Our advice is:
Buy the fastest machine, with the most RAM that you can afford. Second, give-up brand loyalty in favor of more RAM and a better display screen (we recommend 15" or larger screens) and don't get stuck on the idea of a laptop being too wide for airplane use, you'll be in the field or a hotel most of the time. Avoid wide screen displays unless you are getting at least a 15.5" diagonal screen and 1050 pixels in height. Spend the money on the SSD hard drive for speed gains, better battery life and much higher reliability without the hard drive crashes. Consider keyboard layouts if you are accustomed to a particular style. Lenovo, Sony and Toshiba and Dell have figured out that direct sales over the web and direct mail are widely accepted. Lenovo's newest machines and most Dell, Toshiba and Sony models are available for $500 to $1,700 loaded; while less well known brands may cost still hundreds less. Also consider if Windows and Microsoft Office are included.
New operating systems typically require a "seasoning" period for the MIS professionals to get excited about the new features and reliability. Virtually every major vendor and Windows based programming house has switched away from Windows-XP to Windows 7 (Lenders) and now Windows 10. The desktop navigation hassles associated with Windows 8.1 put many people on hold and Windows-10 has cleaned up most of those issues.
NOTE: Windows XP is no longer be supported by Microsoft since April 8, 2014.
That means that there will be no more security patches.
Get rid of Windows XP or you will be infected and contribute to the spread of viruses, worms, trojans and malware.
Windows-7 looks great and runs great. This is what is installed on most Lender / Corporate machines now and some Lenders are on Windows 10 at this time.
Windows-10 will take a little while to adjust to. It was designed to be touch-pad aware from the start and that is a good thing, but spreadsheets, accounting software and long Word documents are still better with a real keyboard and mouse. Some of the "standard" things that you expect will not be in the same place and will not work the same way. A little bit of relearning and a few gripes for sure. Maybe touchpads will be OK for taking inventory, but for accounting work, you'll want a full screen, keyboard, mouse and maybe a second monitor too. Keyboards are a must for typing reports!
The 64 Bit Question:
For those that don't remember what the differences are between 32 bit and 64 bit operating systems, the concept is about how many bits of data you can move at one time (in one cycle). Think of a bricklayer carrying 32 bricks as compared to one carrying 64 bricks with each pass from a pile to the job-site. You get more done faster with the 64 bit load per cycle. The question for the users has been "Will it run my 32 bit applications?" Yes it will. Questions about speed, reliability and other concerns seem to be largely unfounded. Everything is in place now and most of the laptops are coming with Windows-64 bit installed. 64 Bit computing is here, it works, it is fast and it is everywhere.
What about the Macintosh? The Macintosh is OK if your shop is all Mac. But how many Mac shops are there in the ABL profession?... probably under five. In 2009, Apple announced that they have an emulator for Windows to run on a Mac, but why pay the premium price for the Mac and then slow it down with an emulator? Great and "sexy" machines for sure, but is that important? The newer Macs will dual boot to Windows or OS??, but you pay a premium price. Compatibility issues? We have seen that the Microsoft files need to be in a Microsoft data structure and you may have problems with copy and paste from the Macintosh side to the Windows side (just run all Windows applications if you are doing business PC applications on a Macintosh). They are indeed very nice machines.
From Apple iPads to the huge number of other tablets, this product category is growing fast. But there are problems. With the operating systems consisting of Apple, Microsoft and Google based code, there is not any focus from the software vendors in the ABL arena that is outside of the Windows area. There are "Apps" that do specific things like show Borrowing Base availability or even system stored trends and stats, but these are small "Apps" and not full blown systems. Some of the cloud based systems can display in a web browser and that offers the ability to show the data on almost any of the tables operating systems. Software vendors that needs to program for Apple, Microsoft and Google operating systems would need to charge a lot more money to support all three operating systems. This is a case where competition drives up prices due to the narrow vertical market of a small ABL population. We are seeing tablets in the sales and monitoring space to do simple tasks like loan applications, loan advances, Borrowing Base review and other lending tasks. But for Field Exam/Audit, it does prove some challenges to type in thousands of numbers, word process, copy and paste, Etc. Sure you can add a keyboard, mouse, keypad, but the world has already invented a better product for that, it's called a "Laptop."
Virus Paranoia and...
YES, you need virus software to be running all of the time
YES, you need to subscribe to the automatic updates
YES, you need a software firewall such as Norton Internet Suite or McAfee Internet Suite or Zone Alarm
YES, you need to run spyware software checks from AdAware/Lavasoft and SpyBot to keep the junk out
YES, malware is also out there. Try to run Malwarebytes at least weekly.
YES, you need to password protect your computers and remove all Guest Accounts
YES, you need to turn off file sharing if you are on a WiFi network or hotel network or your borrower's network so that they cannot get your files.
YES, you need to password protect your virus software so that a virus (or an auditor) cannot turn off the virus software
AND... You need passwords that contain 2 uppercase letters, 2 numbers and are at least 12 characters long. For your financial transactions (Bank, PayPal, etc.), you want to use passwords that make no sense, are not in dictionaries, cannot be guessed and are not used for any other purpose... AND your financially linked passwords should certainly be more than 12 characters long.
Windows 10 is the new standard. There are few bugs or operating system crashes. Windows updates are installed with a web update and reliability is very good. We recommend the Professional version (network enabled edition) and 64 bit flavors. And of course, we recommend that everyone learn about virus threats, password threats and how to prevent them. If you get Windows-10, be patient to learn about it and get the latest software patches for your favorite programs.
This is a hardware and operating system question, but again, we have some frank answers. If you use only spreadsheets, speed is generally not a problem. Spreadsheets are all written in "C" (not C++) and the applications are fast.
But what if we link the spreadsheet into the word processor with
OLE links or DDE? Word takes 3-5 Megs for the executable
program and Excel Takes 3.5-5 Megs for the executable program, plus
all of the DLL's for Excel and Word, plus the OLE layers and you have
a need far in excess of 32 Megs! This Ram and processor cram is
often called "Overhead" and it slows down the system. The power
of Excel and Word are deep, they just require lots of RAM. For
speed, keep it simple, lose speed with linking (and gain all the maintenance
chores) or find a better way.
Do you believe that hardware will make your examiners faster? Do you believe that spending almost $1,500 on a new Dell or Lenovo ThinkPad, with a life expectancy of 3 years will get your examinations done faster? Do you believe that the new Microsoft Office 365 will allow you to complete examinations faster? The Spin Doctors at Microsoft and Intel are having a hard time getting word processors and small spreadsheets to run faster (ok maybe it's 3/1000th of a second faster on the recalculation -- BIG DEAL!).
Lies, lies, lies. We see virtually no speed difference in our 486 versus our Pentiums when it comes to spreadsheet speed. It scrolls a bit faster, it shows graphs a bit faster, it plays games a lot faster (by the way, that's from the video card improvements). There is some improvement if you link to word processors (e.g., glue Word and Excel together). In short, the productivity advantage of the "big-expensive" machine is under 10% with a 0% improvement in the quality of reports. Many people are getting newer machines due to super cheap prices and improved reliability of the hardware and Windows-10. Our very old 1.6 Ghz Duo Core machines with 2Gig of Ram are so fast on spreadsheets and word processing that there is no speed improvement seen and our i7 super-PC's show little improvement over that with a spreadsheet. There are two exception, noted in the next section below.
Lies, lies, lies. We see virtually no speed improvement with Office-2000/XP/2003/2007/2010/365. Office is code bloated and packed with features to play with. Productivity fell from using Office 2007/2010/365 as users build frustration and use time reading help files, trying to find and use all of the features. The truth is that spreadsheet features have been relatively consistent for almost 33 years. Office 2007/2010/365 includes a new menu structure to confuse people even more. The spreadsheet has slowly evolved with better formatting, better graphs, better preview screens, Etc., but the basics developed by VisiCalc (circa 1981) are the same. In short, the productivity advantage of Office-2007/2010/365 is 0% (possibly a loss) with no improvement in results-based quality. Office 2007/2010/365 will require those that switch to learn a few new tricks to get back the speed that they once had. Office 2007 / 2010 / 365 will destroy macros that use menu commands and some older pre-Office-2007 functions, so now you need to start your automation all over again.
The lies continue to be perpetrated by Intel, AMD and Microsoft who want shareholder results. What kind of results do you want? Custom tailored and highly integrated software is the best way to improve the speed and quality of field examinations. Just look at accounting software, factoring software or back-office software used in the ABL business...or are you still using spreadsheets? We cover the customization choices below.
Our advice, "Don't budget too
much for hardware, spend your budget dollars
Our company, FinSoft, produces several products and one is a fast data analysis package that is specifically targeted to analyzing ABL data. Faster machines process data faster because in the case of data analysis, there are millions of calculations being done. Our faster machines can reage a receivable report, refoot it and calculate all ineligibles from a 40,000 invoice report in about 12 seconds on a dual core i7 system . Yes, the hardware does matter and in our case the software uses very advanced logic to make all of the calculations so fast.
Modern Windows-10 is using advanced graphics display technology that makes some of the screens look like a glossy photograph. This requires very fast graphics processing and a new machine is going to have that.
Back to data analysis, that's a software solution. We have
cut the time on some field exams in half with
our data analysis product. We've found plenty of fraud cases and
probably prevented others with detailed analysis and mathematical proofs.
Why would you want to do your fieldwork and back office calculations
slower? Why would you want extra staff? Why would you hire
an outsource firm that can't get things done with data analysis?
Why would you avoid software that was written specifically for ABL to
save time and money in the manner mentioned above? A possible
"avoidance" answer (excuse) could be that you are paid by the hour (possible),
you like to work too hard (unlikely) or you haven't seen what we've
got (hard to believe) Great software deserves your attention,
but most of the hardware is about the same and it has never been more
Joe Caplan, Managing Director
phone (410) 747-7994