Keeping Up with Technology Trends in the AEC Industry
Five Ways Using Old Accounting Software Can Create New Challenges
Secure, reliable project accounting software with advanced functionality and the ability to automate tasks is now a necessity for running a profitable AEC firm. Architecture and engineering firms today are looking for software that integrates all the business functionality they need: accounting, project management, time and expense, resource management and financial reporting. Each components is important, so it’s a big risk to allow any of these important tools to get rusty.
Here are red flags that your old software is becoming a liability
- You are losing revenue because billable staff are underutilized
- Your firm is experiencing cash flow problems
- Information is in more than one place or in multiple databases
- You’re starting to see glitches that indicate data is disappearing
- Customer or user complaints are on the rise
Falling behind with AEC software puts your firm at risk
These warning signs are an indication that danger is lurking around the corner. With so much at stake, why do some organizations persist in using outdated, unsupported accounting software? Often it is simply a case of indecision or inertia.
Even though many AEC firms recognize the challenges with an older system, they may rationalize keeping it for the following reasons:
- Our users are comfortable with the current system and may not like adjusting to something new.
- We want to avoid the time and cost of systems migration and retraining, particularly if it impacts billable time.
- Our business requires constant availability to the data; we can’t afford to take the system out of service.
- Too much money has been sunk into our current systems; we need to recoup that investment.
Although these may sound like good reasons at the time, they don’t cut it when it comes to the long-term financial health and success of a firm. At some point the cost of remaining on old technology will be greater than the cost to migrate to a newer solution.
What are the risks for remaining on old technology?
Knowing when it’s time to invest in new accounting and project management software can be tricky, especially if your current system works fine at the moment but you know it’s being phased out in the near future. It’s easy to procrastinate. However, planning for change now is a better strategy than being forced to react frantically to unforeseen events in the future.
Take a look at some common scenarios. They may convince you to review your software requirements and plan your upgrade now:
What if you get a virus or your server crashes? What is your plan for data recovery?
All technology has a shelf life so it’s inevitable that hardware will crash, which could lead to data corruption. In the event of a server crash, have you considered how much data you could lose and how long would it take you to get back up and running? To minimize damage, would your current software provider be able to help you recover your files immediately or provide you with a secure, offsite backup of your data?
Here’s a better alternative. Why not eliminate the server entirely and adopt a cloud-based software solution? Don’t wait until fields start disappearing and you’re losing data to realize your current software is degrading and you have no way to address the problem. Put a plan in place now to alleviate the risk of data loss destroying your AEC firm’s productivity and profit.
What happens if a star employee you rely on for tracking accounting and project information leaves the company tomorrow?
Outdated accounting systems are a back office tool, isolating information between project managers and accountants. Often this leads to project managers tracking budgets and schedules in excel spreadsheets stored on their laptops, outside of the firm’s core financial system. Not only does this make real time, reliable reporting impossible, it means that few people know how and where to access the right information.
It's never good news when talented people leave. However, with a modern integrated accounting and project management solution everything is in one central place so your projects can keep ticking. Newer accounting systems are geared to the specific needs of AEC firms and provide fast, accurate financial visibility for everyone in the company from one central location. So if a project is going over budget, a red flag is raised for everyone. Ultimately, this can dramatically reduce budget overruns and project delays for your firm. It also eliminates the fear of people leaving since remaining staff can easily pick up where they left off.
What if you have a problem and are unable to close out your AEC firm’s books? Is there someone available to pick up the phone and help you?
Although you may be a power user with your current system, you may eventually run into technical problems from software degradation. Using software without support is like driving a car without insurance -- you don’t need it until you crash and then you kick yourself for not having it.
When your accounting and project management software is no longer being supported, you won’t be able to count on that software provider to find bugs and provide updates that will secure your system. You won’t receive product enhancements to help you stay competitive. The longer you remain on legacy software, the further you will fall behind and the more difficult it will be to catch up.
If you have to replace your hardware, will the new operating system support your AEC firm’s legacy accounting software?
A new hardware update or new operating system often causes problems for old business applications companies are using. To work properly old software must be kept up-to-date with modern hardware and software configurations. You don’t want to find out on the last day of the month that your new laptop won’t launch your financials or that the new server isn’t compatible with your document management solution.
If your business software doesn’t meet a government requirement, can you count on your legacy technology provider to help you?
Your AEC firm may be meeting all of your auditing and reporting requirements now, but requirements are constantly changing. If your current accounting system is no longer receiving updates and enhancements, your accounting software can become obsolete the moment it fails to accommodate a new government requirement. Why wait for this to happen if it could result in losing that new contract or failing to capture additional work with existing clients? It definitely pays to plan ahead and to be proactive so you can react to opportunity immediately.
To succeed in business you must have the foresight and ability to plan what needs and obstacles your AEC business will face around the corner. Lack of planning puts your business and your reputation at risk.
Deltek’s project-based ERP solutions are tailored to the needs of the AEC industry to help manage the complete project lifecycle including: business development, project management, human capital management (HCM), document management and financial management. Whether you’re a small AEC business or a large AEC enterprise, Deltek has the right solution for you. To learn more about how Deltek can meet the needs of your firm please visit the Deltek AEC Industry Solutions Page.
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