You probably wouldn’t wear heels to go hiking, right? Obviously not! Similarly, it’s not the best idea to run a large business using the wrong tools either.
In fact, if you are a project-driven business, it is crucial to invest in an ERP that is designed specifically to cater to the constantly evolving needs of project-driven businesses. This allows you to make well-informed decisions as you have improved clarity on the goings-on of your corporate and project financial information.
In short, project-based ERP adds limitless value to your business, making it a worthy investment.
While this diagram depicts how the right project-based ERP benefits your business, let me elaborate a bit on each of these points.
1. Winning More Deals
Are you wondering how in the world will an ERP system help you win more deals? It does so by telling you
· which current projects are most profitable?
· what type of projects have the biggest impact on your profit margins?
When a business can tell what kind of projects bring in the most money, this information builds a basis for solid cost estimation and improved track record of performance, driving efficiencies into your business development processes.
As a result, you can focus on the projects that are best suited to your skill set, and in turn, increase your win rates.
Your project-based ERP helps to identify and provide past performance information to potential clients, becoming the key differentiator in the bid cycle.
2. Better Resource Utilisation
For any project-driven business, your workforce is your biggest asset. And being able to utilise this resource more efficiently makes a huge impact on revenues.
With the right project-based ERP, you are better able to track where your people are being utilized (and also, where they are NOT being utilized to their maximum potential!). Being able to track this information easily through an ERP helps reassign people to the right tasks – the ones that are generating revenue!
3. Generating Higher Profits
In today’s cut-throat world, more and more businesses are competing for fewer and fewer projects, creating a scenario where pricing must be as competitive as possible. As a result, profit margins are tight, which means you have to carefully bid for projects ensuring that your profit margins stay secure.
So, how does the right project-based ERP help here?
· It offers you better visibility into actual project costs, performance, and risks on past projects, helping to make controlled bids. Going blindly into a project can result in negative profit impacts for the organisation in the long haul, and that is something you really don’t want.
· Also, such an ERP ensures that projects are well run. Not wasting time, money and resources is a huge part of the equation when it comes to maintaining profit margins.
Financial and project management ERPs enable businesses to keep costs in line and create accurate forecasts that support profitable bids. While also ensuring that projects (and any changes that become inevitable during the execution of projects) are managed well to maintain margins.
4. Boosting Revenue and Cash Flow
A project-based ERP system ensures that you don’t waste time creating accurate invoices for each of your clients, so you can get paid on time. Since all transactions are validated for accuracy at the time of entry, generating timely invoices becomes more automated and predictable, with fewer errors.
When clients get timely invoices, your business gets paid on time, which greatly accelerates cash flow.
5. Automating Compliance
In project-based ERP, the accounting and business rules are well-integrated with the project itself, making compliance more uniform across the business.
This is an important area where project-based ERPs stand out from more generic ERP systems. The latter can rarely enforce business and accounting rules upfront, which means that any violations are caught on the back end of a transaction’s life cycle – usually during reconciliation or audit.
Project-based ERP systems are designed with compliance in mind; hence they have forms and reports (such as a Billing Format) that simplify life and take any guesswork out of compliance.
6. Improved Visibility and Control
If your system is siloed in the absence of project-based ERP, chances are that it can take days or even weeks to put together accurate information about schedules, costs, and profit by project or program. Things like missed deadlines, cost overruns, and backlogs can then jeopardize individual projects — and in worse cases, potentially upend the profitability of the entire organisation.
With Financial and Project-management ERP software solutions, your entire team has improved and timely visibility into project and financial status, as well as more clarity about all risks and opportunities. Executives and project managers get alerts about potential cost overruns and schedule slippage without reading through lengthy reports, helping them keep tighter control of the project as a whole.
So, you see, the right project-based ERP gives your business timely and accurate information on many levels, reducing the risk of any unpleasant surprises. Additionally, it also
allows businesses to take proactive actions to address issues before they impact schedules, costs, revenues and/or margins.
And we think that software that is capable of doing all this (and much more!) is definitely a worthy investment!
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About Projects Expert
Projects Expert is the first of its kind Oracle partner that specialises in Project Centric Enterprise Solutions. We aim to deliver sustainable, robust, and business-friendly Oracle solutions for Projects driven organisations.