Connecting Construction Operations with ERP
The key driver of this transformation is connectivity. Connected data, connected teams and connected workflows are further evolving the industry. The next revolution in construction project management will take this connectivity one step further and integrate project management software with enterprise resource planning (ERP). This integration gives construction teams a 360-degree view of their portfolio and up-to-the-minute financial data for informed decision-making.Is your project management solution as connected as it should be? Without integration between systems, duplicate data entry is required to update each system and the data needs to be merged manually for many processes. If your operations and ERP solutions aren’t talking to each other, you’re doing yourself a considerable disservice. You’re letting ongoing and unnecessary inefficiency interfere with achieving your end goal — completing projects on time and on budget.
90% of global projects are either over budget or delayed, according to global construction industry statistics.1
How Most Project Management Solutions Fall Short
Many general contractors already use a project management solution — but not all solutions are created equal. All too often, the project management solution is disconnected from other business systems such as ERP. This creates challenges, including:
- Duplicated data entry. The time lost to duplicate data entry is a major drawback of maintaining separate systems with siloed data. The data must be manually entered into both the ERP system and the project management system to align the information needed to complete processes. Each of those entries adds to the team’s workload and increases the potential for errors to be introduced.
- Out-of-date data. When data is manually collected, entered and tabulated, it is immediately out of date. Making decisions based on out-of-date data decreases accuracy, productivity and overall efficiency. If construction crews are working with out-of-date information, it can result in costly rework and delays.
- Incomplete data for reporting and analytics. Without fully integrated job cost information, organizations can’t glean actionable insights from reports and analytics. For example, even the most sophisticated business intelligence tools for dashboarding and analytics are only as good as the data that is fed into them.
- Increased cycle times. With manual processes from requests for information (RFIs) and potential change orders, to change orders and billings, each step adds to the organization’s cycle times. When the increased opportunity for errors and bottlenecks is factored in, those cycle times get longer still.
These issues can all contribute to expensive rework and have a cascading effect on your ability to make the best decisions and get access to the resources you need so that you can complete projects on time and on budget
95% of all data collected across the construction and engineering industry is unused.2
How Integrated Project Management Solutions Bridge the Gap
Solution providers are making a big leap in the use of technology to overcome the inefficiencies that are inherent in the construction industry, including the disconnect between operations and accounting. And that’s especially good news because operations and accounting are the most active areas of project management in construction.
To remain competitive, contractors have been moving away from outdated paper-based and manual processes toward digital processes that drive efficiencies. For many contractors, the next step toward modernization is connecting operational project management and financial information. When these systems are connected, any team member can enter data once and know that it will be populated wherever it is needed in both the project management and ERP systems. With fully-integrated and real-time data, your teams can make better, more informed decisions — faster and more cost-effectively.
The “out-of-the-box” myth
Be wary of solutions positioned as “out-of-the-box.” In reality, every construction company is unique. With out-of-the-box solutions, you’re likely to have very limited or even no flexibility in adapting to your business processes, workflows and rules. By choosing a highly configurable solution with preconfigured best-practices, you’ll gain the advantages of both an out-of-the-box solution and a custom solution.
Six Capabilities to Look for in an Integrated Project Management Solution
Whether you purchase an out-of-the-box solution or work with a solution provider to customize the software for your specific needs, there are several capabilities you should look for. These are absolute requirements for getting the greatest benefit from a project management solution that integrates operational data with accounting data.
Even though you may have similar processes, your company is different from the one across town. You have unique needs, and your project management solution must be adaptable to those needs. It’s also likely that you’ll have different requirements from project to project. Configurability allows your teams to fine-tune a solution to meet the specific needs of your business and your projects without involving IT or going to the vendor for customizations. The best project management solutions let you easily integrate with other systems such as an ERP system or other point solutions. With these integrations, all users gain the insight and flexibility they need to make the right decisions, and to do it quickly.
Related to configurability is extensibility. Increasingly, contractors and owners are looking for ways to integrate other aspects of the business into project management, such as customer relationship management (CRM) and human capital management (HCM). A flexible, configurable solution that can easily adapt to changes and add-ons gives you the agility you need to stay competitive as your business needs change and your business grows. An open API design enables your teams to dynamically integrate other systems as needed — without requiring customizations by IT or the software vendor, and without adding costs.
Consider whether the solution is designed for an open API and if the provider charges for access to the API. You’ll also want to know if integration will require a lot of work for your IT team and if the solution offers you the flexibility to adapt the software to meet your business needs. If you want to add touchpoints in the future, you should be able to do that yourself, without having to go back to the vendor for help or customization.
3. Seamless Data Integration
Whether the data originates in operations or accounting, it should be entered into the originating system once and then pass seamlessly into other systems. Once the data is entered into either the project management or ERP system, it should be available across the system to anyone who needs it. Workflows should be configured to automate the movement of that data in real-time, based on your business processes. Project management software that’s designed with open APIs enables this type of easy interaction. Data integration and automation eliminates the need for cross-training and duplicate data entry — saving time, reducing costs and avoiding expensive errors.
4. A Provider with Expertise in Both Construction and Accounting
Your solution provider should have experience and expertise on both sides of the equation. Selecting a provider who has an ERP system in-house is especially useful, both for simplicity’s sake and because of the expertise offered. These providers understand both the construction project management and the accounting sides of the business.
5. Automated, Dynamic Integration
Your provider should offer solutions that are fluid and easy to use. Be wary of “out-of-the-box” solutions that require manual work for integration. Without dynamic integration, every transaction must be approved individually in the project management system and then pushed to the ERP system. You want a solution that automates this process.
6. A Cost-Effective Pricing Structures
You need to know the true cost right upfront. Does the pricing include catches such as usage-based costs or payment for access to the APIs? Your ability to control costs and to effectively manage your budget are crucial elements in construction project management and are a key advantage of an integrated project management solution.
The Future of Construction is Connected
From minor renovations to massive capital improvement programs, construction initiatives succeed or fail based on the right people having the right data at the right time. As schedules and budgets get tighter, organizations that have seamless communication between all stakeholders will have the edge. At Trimble, we call this edge Connected Construction. The backbone of this connected environment is integrated, dynamic solutions that give you the configurability and flexibility you need to address your requirements and evolve over time, while reducing project management costs.
For example, Trimble’s ProjectSight project management software has dynamic integration built right into it to seamlessly connect operations with financials. It eliminates the need for duplicate data entry from each function; fully automates every transaction, including the approval process; and provides full transparency across the system. ProjectSight also includes the Trimble Connect collaboration environment, which enables architects, engineers, contractors and owners to collaborate across their construction projects.
A Future-Ready Solution
Trimble has applied its two decades of construction expertise in both project management operations and ERP to build its integrated ProjectSight project management solution. ProjectSight evolved from Trimble’s Prolog project management software, which was built on a cost and budget module with an emphasis on automating processes, eliminating manual paperwork and enabling one-touch data entry. Trimble’s best-in-class Viewpoint ERP solutions — leaders in ERP — support the seamless integration of ProjectSight with an open API. We design our solutions for open APIs, making them very flexible. And we don’t charge for API access, which adds to cost-effectiveness.
Successful solutions of the future will give you full control over integration, with touchpoints between the operations and ERP systems and more. They will be configurable, extensible and scalable to both small and large businesses. When they’re developed in a no-code environment, these solutions enable you to easily change, modify and adapt workflows to your business processes as they change and as your company evolves. You’ll have the flexibility to easily add features as needs arise.
The industry is already trending toward integrated project management solutions, where operations and ERP are linked. The logical next steps for many companies are integrating additional functions, such as CRM and HCM — which Trimble is already able to do for our clients. Beyond that, we see the opportunity for even greater collaboration, with new aspects such as regulatory compliance becoming part of these integrated systems.
The time is ripe for you to get ahead of the curve now with a system that’s already designed for configurability, agility and extensibility.
2Jay Snyder, Alyssa Menard and Natalie Spare, “Big Data = Big Questions for the Engineering and Construction Industry,” FMI, https://www.fminet.com/wp-content/uploads/2018/11/FMI_BigDataReport.pdf