Even in the recession some of the largest and best construction companies have taken the opportunity to review and improve their business processes and financial visibility. Many have replaced their computer software systems as a result of that review and are now much more competitive than they were before the recession.
Implementing a new financial accounting system can be a disruptive task for any business, but with the right preparation that disruption can be kept to a minimum and the speed in which the business can begin to see the benefits of the new solution can be increased dramatically.
Here Chris Phillips, a Financial Consultant for the construction industry, looks at the important elements a business should consider when planning and implementing a new financial accounting system including why it is important to involve key players from an early stage of the project
1. Involving the key players in the business
Once it has become apparent your current accounting system has come to the end of the road and can no longer support your business processes or provide the detailed management information required, a good first step to take is to get all key players within the organisation together to understand the requirements from all areas of the business.
“From an early stage of the project it is vital to include key players within the organisation. Your new accounting system is there to provide intelligence and awareness of your business to help understand where and how the business is or is not making money. It is therefore crucial the information it produces is valuable to all key players.” Explains Chris.
2. Establishing the short list of potential vendors
Whilst it is important that your new accounting software is intuitive and robust, it is also important that the vendor powering the system can be a long term partner for your business.
“It is essential to investigate the stability of your preferred vendor and understand the levels of customer support which can be provided.
Looking online and asking around other businesses, colleagues and partners who have had a good past experience using a particular accounting system will help you to build a shortlist of vendors to speak to.
This exercise alone will help you to build a picture of the type of service the vendor provides. Look for those who are proactive. First impressions can say a lot about the level of service you will receive later down the line.
Also look for a construction accounts package, with the contract ledger at its core. In my view standard packages with a purchase, sales and nominal ledger, which have subsequently been adapted for the construction industry, never provide the same functionality or flexibility as those, designed specifically for construction in the first place.” Chris advises.
3. Selecting the final product and provider
Once you have your list of challenges and some software vendors chomping at the bit to come and see you, it is useful to take a look at a few different systems. During those demonstrations, whilst it is important to look at which systems can match all of your requirements, it is equally important to understand what additional information each solution can bring to your business.
“Businesses which have been running the same system for a number of years will be surprised by the amount of new functionality and valuable information a modern accounts package can provide, particularly one designed specifically for construction businesses.
Also ask for a list of customers who use the product and select one or two to go and see. The software supplier should be confident enough in their product and service to allow you to do this. Seeing how the software works on site and talking to the users, can provide a valuable insight into the performance of the product and the provider.
It’s not just about the product. You also need a provider who offers a good level of support and who is prepared to be sufficiently flexible to adapt the software (within reason) to suit your specific needs.”
4. Mapping requirements to software
Once you have decided on the accounting system which is right for your business, the setup during implementation is crucial to the amount of benefit the new system can deliver.
“Matching the accounts package to the requirements of the business is one of the greatest challenges when implementing a new system. If this is done by someone who doesn’t understand the business, it will result in the organisation not getting the best from it.
Having someone in place to match the software to the business and to resolve all of the various options available in a modern accounts package, will ensure that the system provides the information and the functionality that the business actually needs.
Look out for project consulting offered by your vendor or ask them to recommend a specialist. From my experience getting this early planning right can save the business time and money in trying to adapt a system later down the line.” Chris explains.
Chris Phillips has worked closely with a number of construction businesses to help improve processes and ensure the smooth implementation of Mardak Construction Management Software from Integrity Software.