Most of the biggest construction companies have implemented Enterprise Resource Planning Systems (ERPs) to successfully manage and use all their resources like finance, assets, materials, capital, and others. Implementing an ERP system is a huge step for any organization. Are you considering it now for your business? You should be because ERP implementation supports your organization’s all primary processes and operations.
But ERP implementation is a key project with a broader impact. So, it is important to follow the best practices in every phase of the process to ensure that ERP deployment proceeds smoothly and that you get the most advantage from the system.
Read this blog post to discover and learn what ERP is in construction and some of the best critical practices you must follow when implementing it in your construction business.
What is Construction ERP?
It refers to the Enterprise Resource Planning (ERP) system designed particularly for construction firms. A construction ERP is expected to manage the core business processes of a company, including project financials, accounting, project management, resource and asset management, portfolio analytics, general and sub-management, payroll, and more. ERP in construction has two key functionalities – workflow management and data management. These functionalities are equally vital and help your stakeholders manage data and monitor multiple processes across your company in real time.
Furthermore, Construction ERP and software for construction management have been around for many years, and such systems cover the main core of your company’s process needs, managing projects. Ultimately, you’ll be able to gain a competitive edge if you deploy ERP to your business, especially in today’s increasing requirements and high pressure to become innovative as a contractor.
After all, your business needs a solid backup and support from advanced construction ERP software solutions that can simplify unique and complex construction processes.
Best Practices for ERP Implementation
To ensure your ERP implementation runs smoothly and that you get the most out of these new systems, follow the following critical practices below:
1. Have detailed requirements and KPIs in place
You and your team must have a clear vision of what you need to achieve with your ERP deployment. Establish accurate requirements, which should all be aligned with your business goals. It is vital to properly assess what you want to achieve and how every single business process can be improved.
After having a solid understanding of these key requirements, determine specific KPIs to help track and assess the success of your ERP deployment.
2. Select the right project team
Having a strong project team for your ERP deployment is one factor in achieving success. Normally, these representatives of your business group who understand all business processes should work well with others. Your team should include the construction manager and the executive sponsor, who help adjust priorities, pull in more resources, and get more buy-in if required.
The team must also build the top-level goals, KPIs, and requirements and make sure that the ERP stays within time and budget.
3. Select the best ERP implementation, partner
Your ERP partner is also a major component of a successful ERP deployment. Do some research and find the best ERP partner that has the experience and expertise in your industry and aligns with your business goals and company values.
When choosing a partner, research and look for their customer references. You have to confirm that they truly understand how an ERP system can support your overall business processes. Lastly, ensure they can provide support and training after the software goes live.
4. Make sure your data is clean
Are you aware of the status of your data? How clean is it anyway? Knowing your company data’s condition is best because this one important resource is vital in making informed decisions. It is best to start assessing the accuracy and integrity of your data early on since it is a vital factor towards success.
The master data has to be complete and accurate since it can affect all ERP deployment phases, including training and testing your end-users. Another thing – build consistent data formats and practice across the board before data migration.
5. Craft a Change Management Plan
An effective change management plan can help your people adapt to the new ERP system much faster, with a much higher success rate. For more effective change management, your company must set the right expectations early in the deployment process.
Provide consistent project updates and explain the expectations to your employee for the projects to succeed.
6. Make sure there is adequate training and support
There must be training programs for your people based on their respective roles – for example, IT team training, project team training, business user training, etc. You must also prepare an ongoing onboarding program in place for new employees who are joining your company.
Ultimately, preparing and having the rights support is critical since your people come across many issues and will have many questions.
Common Problems Your ERP system can Tackle
We share with you in the previous section some critical best practices for ERP implementation. But to give you a sense of how feasible an ERP system is, we will show you some of the most common challenges in the construction industry that an ERP implementation can effectively address.
1. Inaccurate estimation causes a refusal
Perhaps, your construction firm provides services on a contractual basis. You may find yourself bidding for a tender where you give the project’s estimated costs. As we already know, different clients have other specifications and needs, which is why they pick the best-suited bid according to the firm’s reputation, proposed quotes, and design.
The solution for this is project management software for the construction industry. This software solution enables you to secure precise quotes for overall designs, human capabilities, raw materials, and the time to complete the project. In addition, ERP systems like this can help you determine how much profit or loss your firm can get from any construction project.
2. Improper planning process leads to project failure
Poor planning is one of the major reasons why construction projects tend to fail. The lack of effective coordination among your subs, clients, architects, and other stakeholders causes substandard completion of your projects. So, make sure to exert more time and effort in project planning to avoid any possible risks.
There are several ERPs that can able to monitor your expenses and budgetary funds. An ERP is, in fact, capable of providing you with accurate planning for all resources required for successful project completion.
3. Project management processes are always challenging and complicated
Assigning tasks and tracking work progress across different departments in your company are always complicated, tedious, and challenging. Your solution for this is robust construction time tracking software. With this sophisticated PM tool in place, you can track the work progress, assign tasks, set project milestones, and do a lot of other critical activities.
Furthermore, it also provides you with real-time data where you can track and use the data to create more informed decisions.
4. Time-consuming processes slow down your ROI
Perhaps you have traditionally been reinventing the vision of your ROI (Return on investment). Knowing that tedious, time-consuming, and manual processes can hinder progress, it is crucial to seek new ways of receiving revenue much faster.
You can opt for enterprise-grade software solutions that can help you monitor expenditures for human resources and materials, eliminate manual processes, cut costs for unnecessary techs, and avoid downtime – all of that can significantly affect the success of your business as well as your project implementations.
5. Chaos in the decision-making process
Before making decisions, you must get a detailed view of a given situation. In many instances, you do not get the chance to get the view in one centralized platform. If this is something you are facing right now, ERP systems are the best solution. It allows you and the rest of your team to incorporate multiple types of information, sort it out and process them accordingly.
As you reach this part of the blog, we believe you now understand that ERP implementation is capable of solving many critical issues. We assumed you also learned that to resolve these issues, your chosen ERP system must have the best specific features and modules.
Pro Crew Schedule is the Right Tool for Your Business
Depending on your company’s budget and needs, you will most likely have a wide variety of ERP systems, including on-premises and cloud-based software solutions.
Let us introduce Pro Crew Schedule – a versatile construction management software for subcontractors. This is a fast and easy-to-set-up construction tech that does not require capital investment in hardware, and it is cloud-based and is ultimately designed to improve your overall construction management.
Running a business in an asset-intensive sector like construction is definitely a challenge. Best to implement a reliable ERP system that can help you in planning, delivering, and managing projects, people, and operations of any complexities.