Tweet it: 'Why use a project-based ERP? And what should you look out for?'
Editor’s Note: This post was originally published in April 2014 has been updated with new tips to help you find the features to look out for when assessing ERP vendors.
Across all sectors, companies use an ERP solution. But not all these companies operate in the same way – and very few will be able to use the same type of ERP software.
For businesses in project-based industries like architecture, construction and professional services, a generic ERP won’t provide the tools, data and insights they need. Instead, they need a solution designed around the project lifecycle.
In our Project-Based ERP for Dummies guide, we explore the differences between conventional and project-based ERP solutions, and how the right solution can help you improve visibility, boost revenue and increase profitability.
Project–Based ERP For Dummies
Learn how using an ERP system purpose-built for project-based businesses can help you!
But for those just getting started with project-based solutions, this blog will run through the five key features to look out for when assessing ERP vendors. If a solution includes these features, that’s a strong sign it’s been designed for project-based firms.
1. Track financials at the project level
Most ERP solutions can help you track your general ledger, accounts payable and accounts receivable. However, unless you can drill down into this data at the project level, you can’t get a true idea of which projects have been the most profitable.
A project-based ERP can help you track these figures across individual projects. With this granular insight, you can make more informed decisions about the types of projects you should be taking on to maximise revenue and profitability.
2. Customisable billing
Firms in project-based industries will often find their clients have specific processes and rules around billing. Many generic ERP tools aren’t sensitive to this, and don’t allow the flexibility needed to meet clients’ billing needs.
Project-based ERP solutions are designed from the ground up to support custom payment timelines and terms, along with varied invoice formats. While you can meet these kinds of requests manually with spreadsheets and word processing software, this is time-consuming and prone to error.
3. Time, expenses, people and payroll calculation
Your people are one of your greatest assets – and are likely the driving force behind your project success. Project-based ERP tools can help you effectively track actual time worked by each employee on each project, along with any expenses incurred.
With this information, you can simplify payroll and get a much clearer idea of the real resources you’ve committed to each project – and the costs incurred.
4. GAAP and IFRS compliance support
If your firm works with clients in highly regulated industries, finding an ERP that actively supports compliance is crucial.
The right ERP solution – one designed to meet the needs of project-based businesses – should include features that simplify compliance with GAAP, IFRS and other accounting regulations.
5. Inventory, supply and manufacturing management
Beyond tracking the human and capital costs of each project, the right ERP can also help you analyse what materials you’ve used, purchased, or created for specific projects.
Tracking this data is a key step to recovering all expenses on each project. And collecting inventory and manufacturing data over time can also help you more accurately predict the cost of different types of project as they come in.
Find the right features. Find the right ERP
There’s much more to a great ERP than just these five features. But if your ERP of choice includes these, it’s much more likely to meet your needs from project to project.
If you want more insights on project-based ERP, or expert tips on how to find the right solution read the new Nucleus Research report: this year 2020 Value Matrix report positioned Deltek as a leader for "project-centric ERP".
2020 ERP Value Matrix Leader
Nucleus Research Names Deltek a Leader for Project-Based Businesses
- Accounting and Finance
- Agency Workflow
- Architecture & Engineering Firms
- Business Intelligence
- Change Management
- Cloud ERP
- Consulting Firms
- Deltek Customers
- Digital Transformation
- Financial Management
- Job Costing
- Legal Sector
- Marketing and PR Agencies
- People and Culture
- Professional Services Automation
- Professional Services Industry
- Project Information Management
- Project Management
- Research Firms
- Resource Planning
- Scheduling And Planning
- Talent Management
- Technology Innovation
- Time and Expenses
- Traffic Management
- Transformational Trends