Is Your Construction Software a Profit Center or Overhead Expense?

Posted by ctsguides
April 9, 2008

In the competitive world of construction, profit margins are tight. Jobs, service calls, employee productivity, and even your business tools must contribute to company profitability. This article highlights several critical capabilities that will help you determine whether your current construction software is a profit center or just another overhead expense.

Job Cost
The core of a profitable contracting business is job costing. The more accurate your cost information is, the better you will be at managing your jobs for profitability.

Capabilities checklist:
* Job cost projections are easy to produce on a regular basis
* Provides early warning system for jobs that are off track
* Real-time access to actual costs is readily available

Project Management
Project management is all about detail tracking. Let a few RFIs or change requests slip through the cracks and you might find your crew working for free. Software that automates project management will ensure that changes to the original contract are documented, approved, and invoiced for profit.

Capabilities checklist:
* Tracks job details in a single, easy-to-access database
* Change orders are tracked from initial RFI or directive to invoicing
* Forms provide turn-key production of submittals, RFIs, change requests, and more

Service Management
For contractors that perform service work, technology is readily available to support technician performance, enhance customer service, and automate billings. Taking advantage of this technology can produce a significant ROI while enhancing your company’s reputation as a cutting edge service provider.

Capabilities checklist:
* Dispatching allows for greater technician efficiency
* Streamlined billing for fast payment turn-around
* Advanced technology such as GPS tracking of service trucks or mobile communication with technicians that allows for real-time data exchange

Reporting
How well does your software deliver the information you need to make critical and timely business decisions? Catching problems such as cost over-runs early is imperative to maintain profit margins. Reporting should provide easy access to real-time information and offer the flexibility to customize delivery to meet your unique business objectives.

Capabilities checklist:
* Comprehensive standard reports and inquiries
* Custom reporting options to meet specific needs
* Owner/management overviews available for at-a-glance job assessment, with drill down to detail

Integration
Solid communication between your accounting, operations, and service staff is the glue that binds construction to profitability. Integrating your core technologies makes this communication possible.

Capabilities checklist:
* Single database equals single data entry, flexible reporting
* Allows for enterprise-wide collaboration between accounting, service and operations by putting everyone on the same financial page
* Lowers administrative overhead

Profit or Expense: You Decide
Take time to evaluate how well your software streamlines workflow, automates processes, and provides real-time job information for informed decision-making. If your program doesn’t provide you with many of the capabilities listed here, it may be time to consider whether your construction software is a profit center or overhead expense.

Sheldon Needle is President of CTSGuides.com and helps construction companies make smart technology decisions. Get your free Construction Software Selection Kit and 10-minute Smart Shortlist(TM)Consult by visiting http://www.ctsguides.com/construction-accounting-software.asp or calling 800-433-8015.

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