The construction industry is a complex field that requires efficient technologies to remain profitable. Construction ERP development will help control and streamline many core business processes, resulting in improved customer loyalty and satisfaction, higher net profits, and healthier financial performance indicators.
In this article, the Intelvision team will explain why you need to implement an ERP system and also highlight the main features to look for.
What is Construction ERP Software
Construction ERP (enterprise resource planning) system is a special software built for the unique needs of construction firms across the globe. These systems should include management of general contractors, subcontractors, financial management, accounting, payroll, and service operations in one database.
Challenges of Construction Without ERP Solutions
Nowadays, many businesses in the construction industry are finding ways to overcome common challenges. These include (but are not limited to):
Inappropriate Planning
The construction industry can experience significant losses as a result of improper planning. At the same time, planning for construction projects requires coordinating and integrating various teams and departments located at different locations, which is difficult with manual efforts and can lead to critical mistakes in scheduling maintenance, resource channeling, and following architectural designs. In turn, this can affect cash flow and create labor inefficiencies and contractual problems throughout the entire project.
Managing Multiple Clients
In the construction industry, manual processes often create bottlenecks that cause delays and errors. Generating PowerPoint presentations or Excel Spreadsheets is a cumbersome task if data needs to be collated from disparate sources. Moreover, unauthorized personnel can easily access sensitive information. Last but not least, information managed manually cannot provide real-time updates, making the process even more difficult.
Inefficient Communication
In the construction industry, experts from various areas need to collaborate to complete projects and meet customer’s expectations. Unfortunately, vital tasks can slip through the cracks due to a lack of efficient communication between departments and teams and may only be identified too late.
A Lack of Realistic Expectations, Poor Forecasting, and Incorrect Estimations
In the construction industry, the success of a construction project hinges upon accurate bids to estimate costs. Unfortunately, human errors and outdated data can lead to serious issues with accuracy.
Taking Inefficient Decisions
Construction projects are complex and they involve multiple stakeholders, deadlines, and locations. Moreover, teams must be managed and integrated to meet the final goal. Reaching this goal requires swift decisions, which often need to be taken without access to real-time data or up-to-date information being available. Furthermore, manual decision-making processes are prone to human errors, duplicated information, and other effects often leading to inefficient workflow.
Top 4 Benefits of ERP Implementation in the Construction Sector
A specially developed construction ERP software system tailored to the construction industry can equip businesses with efficient solutions that address a project’s various processes. This includes centralized data, expense management, inventory management, HR management, productivity monitoring, and other features.
By implementing an effective ERP solution into their infrastructure, businesses in this sector gain access to more efficient workflows, accurate document reporting, and more.
- Automated Processes. Construction companies often have multiple operations at once spread out across different locations. By implementing an ERP system, you can ensure the accuracy of all tasks performed while providing more time for strategic projects such as marketing, designing, research, and development.
- Project Management Optimization. Construction ERP software systems are essential for successful project management in the construction sector. Its implementation helps companies maximize their efficiency, optimize projects, and allocate resources accurately to boost their profit margins and reduce costs. Conversely, with proper project management, companies can avoid long-term losses due to costly errors or delays in delivery.
- Efficient Internal Communication. Poor communication between organization departments has often led to missed deadlines and project failure. A construction ERP software can end this issue by providing tools that will help all the members communicate simultaneously.
- Estimated Construction Costs And Revenue. An ERP enables predictive analytics based on multiple parameters, such as resources and pricing volatility. AI-powered construction ERP solutions can further reduce discrepancies between a project’s estimated and actual costs and determine estimated income compared to overhead liabilities.
Features to Look for in a Construction ERP System
Construction companies should look for ERP software with the following features:
- CAD interface
- Accounting
- Financial management
- Payroll
- Logistics and transport
- Scheduling
- Workforce management
- Inventory management
- Workflow management.
In the construction industry, a construction ERP system is a means for keeping track of subcontractors, building materials, human resources, plant and assets, and other running costs that do not appear on the daily balance sheet. Ultimately gives you accuracy, control, and visibility as to whether the project is going to be in profit, or make a loss.
