All too often, construction and industrial services companies find themselves manually preparing paperwork, bogged down in redundant processes, and using inefficient communication channels that waste time and create errors, delays, and increased labour costs.
The main culprits are outdated legacy systems, siloed systems and an over reliance on spreadsheets. Sound familiar? Let’s take a look at the most common system setups and the problems they cause.
- Outdated legacy systems | Many construction and industrial firms still rely on legacy on-premises systems that are simply ill-equipped to handle the complexities of modern projects. They often lack integration capabilities, making it difficult to share data across departments which directly leads to data duplication and inconsistencies.
- Siloed systems | Another common issue in the construction and industrial sector is the presence of siloed systems, where different departments or project teams use separate software applications that don’t communicate effectively with each other. This results in data silos, where valuable information is trapped within individual systems and are inaccessible to other parts of the organisation.
Did you know?
A 2020 study of construction and industrial sector executives by Accenture found that 75% said that their internal business functions were competing against each other, rather than collaborating.
Consider this project scenario: Typically, project managers are tasked with overseeing the project’s progress and ensuring adherence to budgetary constraints. However, they often find themselves disconnected from the budget-setting process, which is handled by a separate department. As a result, project managers lack control over the initial budget allocation. If unforeseen challenges arise on-site, project managers face significant hurdles in monitoring the project’s timeline and expenses to ensure alignment with the allocated budget. This lack of integration between budget-setting and project management leads to inefficiencies and difficulties in maintaining project timelines and financial objectives.
Examples like this are abundant in both construction and industrial services sectors. It’s clear that with siloed systems, collaboration suffers, and incomplete or outdated information makes decision-making less than reliable.
Over reliance on spreadsheets | Spreadsheets have long been a staple, used for everything from project costing to inventory management. While spreadsheets are flexible and easy to use, there are significant limitations. They are prone to errors, especially when dealing with large datasets or complex calculations. Plus, they lack version control, making it difficult to track changes or collaborate effectively with team members.
While many can get by using a system like one of the above – sooner or later they will want to make use of automation, standardised processes or even expand operations – and they will encounter issues almost immediately. If it’s not built to scale or doesn’t share organisation-wide information in real-time, growth, even small incremental changes, is nearly impossible.
Adding to these challenges is the number of unique financial and operational needs of the construction and industrial sectors – such as long-term timelines, complex costing structures, and contractual obligations. Inflexible business systems simply cannot adequately support them.
The solution lies with cloud ERPs
Efficient and profitable construction and industrial companies require a foundational systems architecture that introduces comprehensive, industry-specific capabilities that support all arms of the organisation.
Which is where cloud-based ERPs like NetSuite come in. These solutions encompass a set of core digital processes and capabilities that form the backbone of finance and operations in construction and industrial firms. Integrations then extend and enhance the solution to deliver unified data, standardised processes and automations that support highly efficient, resource-conscious and agile projects.
Eliminating siloes with integrated solutions
Construction and industrial projects involve numerous moving parts, from procurement to project management and financials. By using ERP systems in construction and industrial organisations and integrating with best-in-class third party solutions – such as field services, project management, rebate management and more – everyone can access the same data regardless of system origination. When critical project information is seamlessly flowing between systems, manual entry is reduced while a new level of accountability and project visibility can be introduced. Collaboration and efficiency increase, costs are reduced and fewer problems crop up when pressures run high and millions or billions of dollars are at stake.
Accurate, centralised data to drive smart business decisions
Still on the topic of centralised data, when construction and industrial companies have a single source of truth for all project-related information, their people are empowered to act. By putting accurate data into the hands of all project stakeholders, they can each can make informed, data-driven decisions about project performance, resource allocation, and financial health without delays. Displayed on easily consumable dashboards, real-time insights into key metrics such as project costs, revenue, and profitability, give business leaders further insight to identify areas for improvement, and seize opportunities for growth.
Greater synergy between operations and finances
We’ve established that collaborative project management requires tight integrations between systems. But things take an even more welcome turn when project operations and financial management are united – which is exactly what a cloud ERP like NetSuite allows.
Project managers can access real-time financial data to track project budgets, monitor expenses, and ensure accurate job costing. Finance teams can gain visibility into project progress, allowing them to forecast cash flow, manage resources effectively, and gauge project profitability. This level of system connectivity promotes seamless coordination between project operations and finances, helping construction and industrial firms optimise planning, control costs, and maximise profitability across all projects.
Standardising and automating processes with cloud ERP
Integration and unified data open the doors to new efficiencies– cloud ERP solutions offer customisable workflows that automate repetitive tasks and streamline business processes. This allows for the standardisation of workflows for activities such as procurement, invoicing, change orders, and project approvals. Other financial processes get a boost too. Budgeting, forecasting, accounting, and reporting can be standardised across the organisation. This helps ensure consistency, accuracy, and compliance with accounting standards and regulatory requirements while facilitating cost control, cash flow optimisation, and performance analysis.
This standardisation crosses multiple projects, sites, and subsidiaries, regardless of size or complexity. This takes the hard work out of scaling because as the business grows and expands into new markets or geographies, the solution organically grows alongside.
Empowering the construction and industrial sector with cloud ERP
Cloud ERP addresses the poor productivity of construction and industrial companies head-on, breaking the deadlock in which many companies find themselves. By delivering unity and visibility across technology, people and processes solutions like these are driving fundamental change, growth and differentiation in an industry ripe for disruption.
Even more valuable resources:
- Everything you need to know about NetSuite for construction and industrial services >
- How to leverage NetSuite’s cloud ERP to accurately forecast project profitability in construction industry >
- Learn how to achieve effective inventory management in construction and industrial services with cloud ERP solutions like NetSuite >
- Why the right construction financial management software is key to growth >
- How to plan, measure and monitor project profitability with NetSuite >
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