Tweet it: '7 ERP terms every project manager should know'
Modern Enterprise Resource Planning (ERP) platforms that are built for project-based businesses are becoming increasingly sophisticated. Yet so too is the terminology that is used to describe it. As a project manager you need an understanding of the most commonly used ERP terms and concepts. So what's good to know? Here's a jargon-busting checklist:
1. Business Data
From the figures that relate to that invoice you've just raised to the number of hours it's taken you to complete a task; any type of information that is keyed into your computer is classified as 'business data'. It's usually held deep within your centralised business system, which means it can be retrieved for analysis, scrutiny and review.
Analytics is the process of retrieving, exploring and investigating historical business data as a means of identifying trends: Seasonal peaks in demand, for instance, or the types of customers who are likely to use your services. Project managers use analytics to plan their projects more accurately, basing decisions on past truths rather than assumption.
Project-based ERP for Dummies
3. Project Planning
Project planning involves establishing the project's scope from the outset, deciding on the best plan for its completion and then tracking progress as things evolve. Many variables will impact the plan, including budget and time restraints, resource limitations and client preferences. With so many factors to consider, project managers often turn to resource planning tools to make sense of the chaos.
4. Estimate To Complete (ETC) vs Estimate At Completion (EAC)
As a project manager you'll constantly be called on by management to verify costs. Two very important performance indicators that relate to this are Estimate To Complete (ETC) and Estimate At Completion (EAC).
ETC refers to the amount of money required to complete the project at any point in the project. The calculation helps project managers ascertain if there is enough resources left to complete the project as planned.
EAC is the total amount of money or time the project will cost you in the end; the amount of work already completed plus ETC. This calculation will let you know if you're coming in on, under or over budget.
Accountability is very important in project management and pulling critical past information into a professional report for management, colleagues and clients will be a regular occurrence. With so much information to process in so many different ways, it's usual to automate reporting through a technological platform. This makes it possible for project managers to create documents and save time.
6. Billable Time
The hours you are able to charge back to clients is known as billable time. When it comes to billable time, accuracy is key to maximising your firm's revenue. Every lost hour has a negative impact on your bottom line. It's therefore essential your workforce is scrupulous when it comes to logging their hours otherwise your firm may not recoup the revenue it deserves.
7. Resource Utilisation
Effective resource utilisation means knowing your staff are all working the billable hours they should, that they are optimised. For instance, if half of your employees are over utilised - billing 38 out of their 40 hours per week for instance - while the other half is billing just 30 out of 40, then something's going wrong. Getting to grips with resource utilisation requires insight into day-to-day project related activities, and having the power to work out how they impact the 'bigger picture'. Project managers usually deploy a business system with resource management built in to achieve this 360 degrees vision.
Understanding ERP - Introduction Series
- What Is ERP And Why Do Businesses Use It?
- The Five Components Of ERP Software And Their Individual Powers
- Mastering Project KPIs With Business Intelligence Software
- Project ERP vs Generic ERP - Just What Is The Difference?
- Using A Project ERP System To Plan A Project
- How To Make Time Recording Easier With Project ERP
- 6 Fundamental Questions Your Project ERP System Can Answer
Want to know more? Download our free ERP for Dummies guide for more insight into project based ERP.
Project-based ERP for Dummies
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