How ERP Software For The Construction Industry Can Turn Out To Be A Game Changer

Posted by Binita Jaiswal on January 20th, 2020

Keeping a tight track of budget is very important in the construction business; people who are a part of the industry understand the pressure involved with the budget and a deadline. But how can one prepare for something unplanned, there could be times when some unavoidable circumstances will shake your plan and you need to change the schedule, work on new deadlines. Enterprise Resource Planning software can help you in such situations. It allows businesses to eliminate long time-consuming labor processes and control expenses. ERP software for the construction industry can also help you in reducing the cost, accounting, payroll, and meeting the project deadline.

Strategic planning and resource management decide the efficiency of any project; research showed that 30% of the unsuccessful projects ended because of the shortcomings in planning and resource management. ERP software for construction can help builders to come up with comprehensive plans for projects.

Let us discuss some of the main benefits of ERP software for the construction industry as it will help you in deciding the right product for your business and make you understand the need for it.

Project Management:

Proper project management is the key to any successful project; it is required to have an efficient workflow. In the construction business, you need to manage a lot of activities like asset management, accounting, inventory management, supplies and equipment management, etc. A little mistake can cost you in terms of time and money. ERP software has the capability to do all the aforementioned planning for you. It can help you with manpower utilization, resource allocation, and raw material analysis. Deployed with cloud-based technology, ERP software gives the mobility to builders and managers as they can access the information from anywhere which reduces the downtime and increases efficiency.

Cost Estimation:

A majority of construction companies has to bid on the project with their estimated cost before they acquire any project which means working on a contractual basis. ERP software for the construction industry can help in determining the various cost involved in carrying out a project. The best part is that since the estimation was done using software the actual cost does not deviate much from the projected cost of raw materials, labors, and designs. Another important benefit of using ERP software is that it helps the builders in finding out the profit or loss margins of each project which in turn will help them in estimating the cost and time for future projects more precisely.

Reporting:

Monitoring the ongoing projects and making the right decisions at the right time to avoid any discrepancies is one of the major problems for the builders. One wrong decision can cost time and money to the business. ERP software provides you with accurate real-time data and generates analytical reports which can help managers in deciding the necessary course of action in case of any emergency. Exchanging information within the organization is also much easier if you are using ERP software. Large companies manage multiple projects at the same time, having to monitor all the projects and sharing information can become confusing at times. ERP solutions can help in effectively managing and monitoring multiple projects without any confusion.

ROI:

ROI determines the success or failure of any project. It could be measured in terms of money or other benefits. Every manager or builder is looking for ways to increase their ROI. ERP software can help in this regard as well by allowing companies to control and manage expenditures for employees, raw materials, and miscellaneous expenses. It also keeps a track of the project status and helps in finishing the project within the given deadline.

ERP solutions divide various business processes into respective modules. Like any other business, construction enterprises need to keep step with changing industrial demands and restrictions and simultaneously focus on ways of improving stability and managing cost and risk in the most optimal ways possible. It is for these reasons that ERP software are categorized based on the diversified modules like architectural design, marketing, inventory, Human Resources, and Accounting Management. 

Since each module is designed to cater to the in-depth needs of the business need, it helps organizations stay on top of every facet of their construction business including regulatory compliance and risk management.

ERP software in the construction industry can be the one-stop solution for all your business demands and having the right ERP software can turn out to be the game-changer in the business in these competitive times. It is a fast-paced industry and to keep up with the competition, you need to have the latest technology by your side to keep you in the game. As the 2018 Construction Technology Report notes: “Unfortunately, contractors are still relying heavily on spreadsheet, email and document storage solutions…” 

It is time to change that; business needs to invest in software which will provide integrated, up to the minute information. Till 2017 many companies were using more than 5 solutions to cater various requirements the problem with using a different solution is that they don’t always integrate with other systems and transferring data manually can sometimes result in loss of data or some other discrepancies. According to the 2018 Construction Technology Report, 29.1% of professionals stated that none of their software solutions is integrated and only 6.9% stated that all of their solutions did. When transferring data between disparate systems, manual processes like rekeying data tops with 51.8%, followed by spreadsheets (44.3%), CSV file uploads (33.2%), and custom-built integrations standing fourth with 26.8% of respondents using.

The right ERP software can change all that. Businesses need to understand the positive outcomes of the ERP software as it can help them in dealing with the day to day difficulties of business.

References:

https://www.cdp-inc.com/articles/2018-construction-technology-report

https://www.capterra.com/p/56251/Xpedeon-Estimating-System/