There is no dispute about the importance of tracking actual performance in the field against the estimate and budget for effective construction cost management. Contractors, however, often debate whether to rely on an accounting system or a specialized construction field tracking software option like B2W Track to do it. The best answer is both. Here is why.
Field teams need real-time reporting
Rich King, CFO and treasurer at Schlouch, Inc. in Pennsylvania, hits the nail on the head. “We want our foremen to see how are we performing compared to the estimate, based on productivity, labor, equipment and other cost information that is entered on a daily or real-time basis,” says King. “This lets everyone see how we are doing while there is still time to make decisions to change the outcome.” Construction accounting software is just not designed for this rapid data turnaround necessary to adjust operations the next day, not in a week or a month.
The format matters
Construction field management software provides flexibility to report data back to the field in the most effective manner to inform and motivate crews. Often, that is simplified, summary data that aligns intuitively with the logic and requirements of managing construction projects on site. “With a separate field tracking system, you have independent control in terms of how it’s presenting that information,” says Griffith Company IT director Chis Malafa. “If you’re just pulling things out of the accounting system or looking at what the accounting budget was, that may not be how you want to drive the field.”
Beware of the “single solution”
Accounting platforms sometimes push “one-stop shopping”, promising a single system that can meet accounting and field tracking needs. That has proven to be difficult for software suppliers to fulfill. The reason is that their systems are designed essentially with accounting logic that makes gaining acceptance in the field difficult. The field tracking capabilities are often an add-on application and a secondary priority when it comes to functionality, ongoing development and support.
Accounting systems have an important role
B2W Track doesn’t replace accounting software – it complements it. For most companies, the accounting system is the ultimate system of record on project performance and profitability. Contractors can and should rely on it for in-depth reporting, analysis across projects, work-in-process reporting and authoritative control over things like the cost codes available to assign hours and quantities to and data on active employees and their rates.
Integration is the best model
Contractors that rely on the integrated accounting and field tracking software model for improving cost control say accounting information must traverse quickly to the field tracking system. Ideally, hours and production quantities should also move seamlessly from the field tracking system to accounting. “Using both systems in conjunction with each other provides a common language for the client teams and project teams to communicate and be successful on the projects,” says King.
Please check out this recent article in Construction Business Owner magazine for a more detailed look at the roles of accounting and field tracking software, including additional comments from Rich King (Schlouch, Inc.), Chris Malafa (Griffith Company), Eric Sellman (Mortenson Construction) and Keith Brubacher (Brubacher Excavation).