Do We Need An ERP For Our Construction Business?

by May 31, 2019

Are you ready to integrate core business processes and utilize your data for competitive advantage, growth, and scalability? If so, this article uncovers why it might be time to start thinking ERP.

First Things First: What is an ERP?

A point of frustration in many organizations is that projects aren’t delivered in the expected time frame. The common culprits are usually a combination of poor communication, conflicting priorities, and ill-defined – or a complete lack of – deadlines. These issues contribute to a cascading effect of items not being completed throughout the organization.

What’s Different About An ERP For Construction?

In construction, an ERP system typically has the following modules:

  • Accounting
  • Payroll
  • Job Costing
  • Project Management
  • Inventory/Equipment Management
  • Customer Relationship Management
  • Content Management System
  • Order/Delivery Management

Most best-in-class construction ERPs include an integrated cost estimating tool as well. This fully integrated package eliminates the double entry required when systems are operated separately, saving time and adding to a company’s bottom line.

Free Flowing Data For

With construction ERP software, data is shared among project teams and company stakeholders, often in real time. These systems offer numerous KPIs, Dashboards, and Reports that provide insight from anything to Work in Progress (WIP) on individual construction projects to high-level, overall company financials. KPIs and Dashboards can be viewed in real time while Reports are often automated and emailed straight out of a system so business executives can quickly and regularly review the state of the business.

The True Cost Of A Construction ERP

A good construction ERP is not an inexpensive purchase; though if pennies are pinched, companies will quickly find that they don’t have the right tools they need to run their business well. It is essential that companies in the construction industry have a construction ERP so that they can be properly bonded and insured for projects. This is often an overlooked fact when companies consider an accounting solution for their construction business. If the right data isn’t provided for bonding and insurance companies, the process to bond and insure is much lengthier and cumbersome to execute.

How Do I Find The Right ERP?

It is best to approach the search for an ERP system with an open mind, and with the intent that it will take some dedicated time and participation from stakeholders to make the right decision. Researching and then implementing a good construction ERP may seem daunting at first – and it will take time to set up at the start – but it will ultimately pay you dividends and a positive ROI. When considering an ERP solution for your construction business, ensure you have all of the right people involved in the discovery process. Company executives and stakeholders in each role – from accountants to construction managers – should provide input regarding needs and priorities most essential to helping them get their jobs done well.

Beware Of False Promises

It is also important that you consider the company that is providing the software. A good software provider is going to have the experience and knowledge required to implement your software well; these people are often certified by the software developer to provide service on the software. Any software provider worth buying from is also going to require you to have sufficient training and implementation time on the system. With a good construction ERP, it  is not uncommon for a company’s implementation time to range anywhere from 3 to 6 months to become fully operational on a new system. Be wary of any company that offers to get you operational in time any less than that. In that case, you’re either not buying an ERP system that offers the right tools, or you’re going to be more responsible than you think for setting up your system on your own – an endeavor that construction companies can’t afford to do on their own.

If you’re looking for a good construction ERP system, take a look at our options from Acumatica and Sage. Both companies offer best-in-class ERP solutions that will ensure you a streamlined construction business with the right data at your fingertips.

Ready To Explore Best-In-Class ERPs?

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As an Account Executive at Bangert, I bring my passion for discovering and implementing technological solutions to the construction industry’s most persistent challenges.

My unique perspective on the construction process comes from my 10 years of experience in architectural design and marketing. I have first-hand experience in the design and construction process, from conceptual design and planning, to post-occupancy, and am well-versed in BIM, AutoCAD, Sketchup, and the Adobe Suite. I have designed a range of building types including office, multi-family housing and senior living.

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