The number of challenges a construction company faces on a daily basis approaches infinity. Some of them are serious, some of them are pretty common, but nevertheless – they should all be solved without any exception. To alleviate the process of overcoming bottlenecks, construction companies are continuously searching for a magic wand that could be used everywhere within the company. Typically, the roles of such wands perform various types of software that indeed are of great help in the construction process. For instance, an ERP solution is currently popular among construction companies. This fact is quite explainable if we take into consideration the number of benefits it can provide to an enterprise. In the following chapters we will dive into specifics of construction business, challenges the industry faces, and of course outline the solutions contemporary ERP software is able to bring to the companies that opt for its adoption.
Top List of Challenges Construction Companies Face
ERP implementation in a large-scale business is a time-consuming and expensive process. Depending on the functionality and complexity, the adoption of the system may take up to several years and the total cost may reach up to several hundreds of thousand dollars. But despite the labor input and entailed costs, entrepreneurs opt for comprehensive ERP software implementation anyway. Although the expenses may seem to be mind-blowing at first glance, if we consider the long-term perspective the expenditures will most likely pay off. Business owners commensurate possible risks with possible benefits and receive the understanding that the challenges met during the further company functioning can be overcome much easier and painlessly through the use of the system. Below is the list of main serious challenges that construction companies inevitably face on their way, and the solutions ERP software development may provide for their overcome.
Challenge #1: Planning
It is impossible to build something without proper planning only if it’s not a sand castle on the seashore. The more time and effort you put into planning, the better will be the project execution. This stage does not presuppose only creation of construction schedule. It goes far beyond it: you need to evaluate all possible risks, define the project strategy, establish good communication with a client, specify the amount of raw materials required and many more.
A contemporary ERP system may be of great help when you dive into planning. Through the use of the system you will gain an opportunity to organize the project management in the most efficient manner and monitor the project progress. The ERP software will facilitate planning of raw materials, logistics, human resources etc. more precisely and quickly to ensure best possible results.
Challenge #2: Estimations
Project estimation may be a real headache for entrepreneurs. Since each project is unique, it is impossible to estimate it equally with the one completed some time ago even if they are pretty similar. Instead, there arises a necessity to start this way from the very beginning and to proceed with the necessary calculations. What will be the cost of raw materials? Labor costs? Logistical expenses? “Safety cushion” in case of any unforeseen circumstances? The list of similar questions is quite extensive, and each point should be calculated and elaborated thoroughly and carefully. Because first of all, you need to provide a reasonable price for a client and meanwhile make a profit. In case your price is too high, a client will most likely refuse to cooperate with your company, in case it is too low – you may forget about the profit, and the approach of choosing the lesser of two evils will not work here. Therefore, the estimations need to be as precise as possible to make sure that the cost for the project is fair.
Implementation of ERP software will help you to overcome this challenge. Through the use you will be able to make more precise estimations with minimal time expenditures. Even if deviations occur, they will not be that significant. Moreover, unlike humans the ERP system is not inclined to make random errors, which fully excludes miscalculations related to the human factor.
Read Also How Much Does ERP Software Cost: Ready-Made vs Custom Solutions
Challenge #3: Data Sharing
How many departments are there in your construction company and how many employees do you have? If we consider the large-scale business, the answer is simple and evident: many. And the lion’s share is the employees that need access to data, to process it and use it for work. Handling all the existing data using only Excel spreadsheets is neither efficient, nor safe.
ERP software can definitely help you here. Data access and sharing will not be that inconvenient since everything is stored centrally, and it’s possible to proceed with access settings, to make certain data available to concrete people only.
Challenge #4: Productivity Issues
Delays and productivity issues are also common problems in construction business. You may have the most polished and perfect plan of project completion, but it is not followed – what will be the result? There’s been a lot of it going around in construction companies. Each task requires a certain amount of human-hours, which is the determining factor of how many employees you need to complete it within a given time frame. And setting up an appropriate period of time needed for task completion is still not everything. The project progress should be monitored at all stages to make sure that everything goes as planned and there are no delays expected. Otherwise, you are risking a snowball effect happening here, since each delay entails another. Another important thing is the amount of tasks that should be completed during the project flow. And it may be enormous, which makes the necessity to control all of them a real challenge without a proper digital solution.
Fortunately, with the use of a robust ERP system, you will gain a chance to streamline your project management.
Screenshot from Full-featured Project Management Solution for Construction Industry Case Study
The system will provide you a clear picture of how your project goes. It displays the progress of each task, and if something does not go as planned, you will be able to take necessary actions immediately and therefore prevent possible delays.
Reporting module is also a great help in streamlining the project management within the construction company. The system is able to generate the reports on a daily or weekly basis, which allows you to see some patterns and weak points to start eliminating them promptly.
Read Also How Project Management Software Helps Construction Industry
Challenge #5: Decision-making Process
To buy an ice cream today or not to buy? It is certainly not a type of decision, construction company owner has to make on a daily basis. Mainly because before deciding in favor of any option or direction, an entrepreneur has to evaluate all the aspects it may have an impact on and foresee possible consequences. Taking into account that the whole company and a big number of employees depend on such a solution, the idea to rely on assumptions seems to be dubious. It is much more reasonable to use solid data gathered during the period you consider most appropriate.
ERP software will help you here. All necessary data gathered from all company’s departments are stored centrally and are available in several clicks. Various kinds of reports for the required periods can also be generated quickly, which is of great help when you intend to evaluate it from all sides and make most informed decisions.
Challenge #6: ROI Increase
It’s hard to find a company which is not interested in ROI increase. This process is perceived as a continuous challenge, and no matter if it is measured in monetary equivalent or other benefits. All entrepreneurs strive to raise ROI and improve the overall efficiency through the use of various tools that may be of great help in this demanding undertaking.
ERP software has a recognized position among the tools that help to boost up the general efficiency and therefore facilitate the ROI increase. For a construction company it is an indispensable tool that minimizes manual paperwork and alleviates expenditure control, processes flowing within your company will be optimized and established. You will also have a chance to perform better monitoring over the project progress, and the word “deadline” will no longer be swear.
Conclusions
In an ever-changing environment construction business should also be flexible and adapt to emerging realities. To do that, it’s necessary to keep the nose to the grindstone and find the best possible solutions. ERP systems have already proved their efficiency in the construction sphere. They are pretty easy to use, safe and reliable, which makes business owners implement it in their businesses.
If you are currently in need of the robust ERP software for your construction business, please contact us, our team will build the best solution in compliance with all your needs and requirements.