Heavy construction costs occur in the field, and that’s where collaboration and insight can give contractors better cost tracking and cost control. The problem is, many contractors continue to rely primarily on financial or ERP systems to tell them how they are performing versus plan. Now, operational software and mobile capabilities are paving the way for a more effective field-centric approach.
As margins get tighter, and projects get larger and more complex, these are the reasons status-quo cost management methods can no longer cut it when it comes to staying on budget and on schedule:
Lag Time for Performance Data – Managers and executives can’t evaluate labor, productivity, materials and equipment utilization accurately and on a daily basis, so they can’t make timely, data-driven decisions to adjust operations in the field and control costs.
Lack of Visibility in the Field – The team responsible for managing projects in the field doesn’t have a clear understanding of the overall performance expectations or an accurate picture of where they stand versus the plan/budget on a day-to-day basis.
Inefficient Resource Utilization – Disconnected processes based on paper, whiteboards, phone calls – or software applications that don’t talk to each other – prevent the field, maintenance and scheduling/dispatching teams from working cohesively to deploy crews, equipment and materials in the most cost-effective manner.
No Feedback Loop – Actual labor, equipment and material costs incurred in the field don’t carry through and inform the estimates and budgets for future projects.
Financial accounting and ERP systems are great for their designated purposes. Frustration for construction contractor stems from the fact that these solutions are not built with the field in mind. They fall short for tracking and controlling costs at the operational level – the critical point where insight into project progress and can enable data-driven adjustments to drive profitability.
The promise of an all-in-one solution for accounting, estimating and operations also remains unfulfilled. One system simply can’t do it all and still deliver the logic, features and functionality needed by financial executives in the office and employees in the field.
Download the new B2W E-book: Driving Profitability with a Field-centric Approach to Cost Management to explore 6 essential steps contractors can take to shift to a more proactive, real-time approach to managing costs at the operations level, including:
- Transferring data seamlessly between bids and field logs
- Tracking field performance daily – not weekly
- Collaborating across scheduling, field and maintenance workflows
- Empowering the field team with mobile technology
- Eliminating manual data entry to accounting/ERP systems
- Turning data into actionable intelligence