15 Jan, 2021

ERP Software for Construction Companies

Managing manpower, material, and machinery is a daunting task in the construction industry. The need for a standalone ERP software that can manage various processes like project management, inventory management, and financial management becomes a necessity to fight the ever-growing competition. 

How ERP Helps Construction Businesses?

Standardizing your workflow is crucial especially in the construction business where companies are brainstorming cost-cutting strategies now and then. An Enterprise Resource Planning software like Oracle NetSuite can help you achieve this goal with its state-of-the-art tools like streamlined financials, seamless integration, and a 360-degree view of the business operations. The major benefits of adding ERP software into your construction business are as follows;

1. Modernize Operations

Modernizing your operations is the primary advantage of adding NetSuite ERP. Automation is the first step to modernize operations. You do not want to deal with an array of human errors while you are already knee-deep processing complex scenarios. This becomes even more complicated if you are a large company with multiple subsidiaries and construction sites. Implementing an effective ERP solution like NetSuite can act as a mountain-mover managing all your data in a single database and thus save you from losing valuable time and money.

2. Advanced Project Management

Construction business often works on tight budgets and fixed timelines. Therefore the need for an advanced project management system that can handle various asset records becomes a necessity to ensure a smooth workflow. Any deviation from the scheduled workflow will impact the business heavily and lead to substantial losses.

For instance: Contractors can incur financial and reputational losses due to poor planning, heavy labour costs and untimely completion of projects. Improper management and allocation of raw materials, under-utilisation of labour etc can negatively affect any construction venture. A construction company can make effective plans on the procurement of required raw materials, using labour force efficiently, architectural designs and chart schedules for channelling the resources properly.

ERP systems are capable of handling these complex mechanisms and maintain a proper inventory of raw materials and manpower utilization. Role-based access is a critical feature that many superior ERP systems like NetSuite provide for its users to effortlessly control the operations anywhere anytime.

3. Seamless Data management

Data management is an issue commonly found when multiple disparate systems are involved. In the construction industry, a dynamic platform is necessary to integrate data from various sources like labor and inventory. Operational data from all these sources should be channelized into a single platform so that managers can effortlessly chart operations based on this data to reduce inefficiency.

4. Cut Unwanted Expenses

ERP software provides real-time data that can be exploited to project actual and possible expenses. This will help enhance the planning process and minimize wastage by determining a cost-effective way to utilize resources.

5. Customization

Customization is a must-have in this radically changing world. Because different establishments come up with different needs and functions. Without customization, it would be impossible to keep up with the competition. Prominent ERP’s have a customizable dashboard that can be integrated with various tools to improve analytical features for estimation purposes.

6. Return on Investment

ERP software drastically reduces human errors and gives you key insights on important aspects of business like cashflow, cost overrun, milestone payments, etc which are everyday events in the construction business. Having a real-time integrated view of the company will enhance the operations and reduce downtime. 

Also, ERP systems now come with advanced business intelligence and reporting features that are capable of identifying gaps in the system while also revealing key areas of competence. 

How to Choose a Construction ERP System?

Choosing the right partner is a crucial turn while considering an efficient construction tech. The partner must have an in-depth idea about your industry along with proven expertise to understand and accommodate your business processes into the ERP system. 

A fundamental Checklist is needed to understand some of the core processes that you can expect from an ERP system.

• Inbuilt accounting 

• Expense management

• Human resource management

• Fixed asset management

• Material handling 

• Advanced Reporting (KPIs)

Cloud-enabled systems are a necessity in the modern world. Although on-premise systems are still available.  Choose a cloud platform for timely updations, zero maintenance costs, and rigid security. Cloud ERP’s like NetSuite are scalable and grow with your organization.  

Ease of use is not stressed enough while considering ERP systems. You don’t want a complex system that takes months and years to learn, rather choose an ERP system that is handy and customizable to your needs.

Is NetSuite Right for My Construction Company?

If you are looking for a scalable, customizable, cloud ERP platform - Oracle NetSuite is the perfect ecosystem for you. The software houses a number of applications like CRM, PSA, Payroll, Finances, and HR that can easily integrate with your existing legacy systems. If you are in the business of construction, you are already familiar with Job costing, NetSuite is capable of handling all your accounting needs and will provide you with advanced projections with its KPI dashboards.

Here are a few pointers to consider NetSuite for construction projects:

• Financials

NetSuite boasts advanced accounting capabilities for managing all your back-office operations like Project Cost Management, payment management, General Leger, taxes, and more. Also, NetSuite can seamlessly handle organizations that have multiple entities and is capable of handling multiple currencies and tax management.

• Regular Updates

NetSuite regularly provides updates with new features and its modules are cost-effective when compared to the ROI it generates. Cloud ensures that these updations don’t directly impact your business processes once implemented.

• Integration

NetSuite allows seamless integration with legacy systems. This is a notable feature because without effective integration all your past data from other systems that can be effectively used to create data models will be lost.

• In-depth Visibility

Construction businesses need to have complete visibility over all the activities. With NetSuite, you get real-time data across all your departments like marketing, inventory, accounting, and client management. NetSuite is capable of removing any existing silos and streamline all your data into a single system. Through this inter-departmental communication becomes easy thus improving productivity.

• Improved Accessibility

NetSuite acts as a centralized platform for your business and helps in the integration of data from multiple sources. This data can be accessed by users from anywhere in the world and can improve decision-making capabilities.

• Job Cost Accounting

NetSuite helps you gain in-depth knowledge of your job costs. Along with this it provides an idea of the job costs and tracks in depth details such as cost-to-completion, cost-at-completion, along with progress level to assess the estimates of your projects.

• Intercompany Consolidation

NetSuite OneWorld helps in multi-company business management, with this module you can easily manage financial consolidation between separate companies in real-time. OneWorld lets you drill down to all the underlying levels in a multi-entity business, meaning it is possible to gain insight across all your companies easily.

• Customizing NetSuite ERP for Construction

NetSuite can be customized to align with your unique business processes. In the construction industry, the following customizations can be added to suit your business needs.

Job costs are unavoidable if you’re in the field of construction along with AIA invoicing & Schedule of Values. In terms of financial aspects - partial payments and advanced revenue recognition can be added to your NetSuite depending on your requirements. 

• Management integration with MSI Data

Integrate a field service management software with NetSuite and eliminate time-consuming data entry processes like importing and data reconciliations, NetSuite ensures a seamless process for equipment repair. Once integrated this service module is capable of rapid inspections and preventive maintenance that can minimize unwanted expenses. 

If you wish to speak to professionals regarding NetSuite implementation for your construction company contact Jobin & Jismi for a quick quote.