Expert advice | 9 February 2022
5 reasons professional services firms should use an ERP solution to manage projects
Regardless of industry, project type, or firm size, most professionals share similar needs when it comes to financial and data management. Enterprise resource planning (ERP) is a software system designed to meet those needs hassle-free by allowing companies to manage most of their activities from one place and keeping them up to date on crucial factors like budgets and generated revenue. CEOs, CFOs, and employees can use this software to view company financials, keep tabs on money coming in and going out, secure data safely, and more. Instead of having separate systems to deal with each of these individually, an ERP system is a one-stop shop to manage every cog in the business efficiently. Below are five ways an ERP solution can help with your projects.
An ERP system increases financial management efficiency
Despite their differences, every company shares the common goal of wanting to manage finances as effectively as possible. Too often, though, a disorganized system will stand in the way of that. An ERP solution solves all the problems presented by inefficient spreadsheet tracking and manual tasks that allow wide margins of human error and simply take up too much time. Consider the expectations of an accounting team at an engineering firm that’s tasked with generating profit reports, identifying high-earning projects, allocating company funds correctly, setting budgets, and monitoring material costs. In order to make the wisest inputs regarding the company’s funds, this information needs to be accurate, organized, and presented effectively. An ERP solution can help with all of this. When determining how much funding to designate to an upcoming bridge construction project, for example, the company can use its ERP system to see the profitability and costs of a similar project done in the past to make an informed decision. Since the ERP system also generates reports automatically, accountants can streamline their processes and revise budgets more easily, if need be.
An ERP solution tracks project costs and revenues at all times
Using an ERP solution provides a global view of operations within a business so company leaders can get a clear grasp of factors like profitability, costs per project, and budget management. It’s so easy for a business to allow this data to become scattered, and, when that happens, exceeding the budget can become a real consequence. Using an ERP solution will keep these numbers organized and take the guesswork out of the picture right from the start. Imagine, for example, an architecture firm that has been contracted to design new buildings for a second campus of a prominent university. A project like that has several phases, many architects involved, and it’s going to take quite a bit of time and company resources. For something like this, the firm will want to set up the project in their ERP system to monitor things like budget expenditure per project phase and whether they’re on track to stay on budget overall. The firm should also be using their ERP system to track when deadlines are met by the architects. Extending deadlines means using more company resources and that affects overall project profitability.
With an ERP solution, making payments is hassle-free
Payments and billing systems can be a major headache if software is out of date or ill-equipped. Even your best employee can only handle so much at a time. That goes for your accountant too. Too much on the plate will lead to mistakes sooner or later. Working with ERP software is almost like having a personal assistant help out with everyday tasks. Take, for example, the to-do list of an accountant working for a consulting firm. That accountant must pay taxes accurately and on time. She must also pay full-time employees and freelance consultants. Everyone in her system has different rates, billable hours, and projects durations. The different variables have her inundated. With an efficient ERP solution, she could better organize payments and make end-of-project payments automatic, working with multiple currencies if need be.
An ERP system stores data safely
A big part of data management for service workers is making sure that company files are safely stored. Stories of hacked accounts and stolen data can have business owners in a fret. Usually, professional associations prohibit their members from disclosing their client lists to protect confidential information. ERP software not only facilitates relations with clients, it also keeps their information safe from prying eyes. For example, a hacker would have a hard time obtaining client data from a law firm that uses a management solution. To do so, he would have to get past several complex security mechanisms. On the other hand, a hacker could easily break into the computer of a law firm that stores their client list on a spreadsheet. Imagine what could happen if the hacker published that list on the internet—the firm’s reputation would take a big hit. In short, an ERP solution simplifies the management of current and potential clients of professional firms, while ensuring their data is protected.
An ERP solution enables executives to use the system while away on business
Those who run high-growth companies have enough on their plates without being held back by systems that can’t rise to their demands. Say, for example, that a major accounting firm has been rapidly expanding in recent years and, as such, the executives regularly find themselves travelling for business. During the busy season, they’re away from the city for an average of two weeks a month, meeting with clients and checking in on major projects. Since they go back and forth so frequently, they need a management system that they can use on any device. Many software systems, though, have to be installed on individual machines and won’t work on tablets. An ERP system solves this issue by allowing users to work from anywhere so long as they have internet access. This means that all C-suite members can check up on key components of the business no matter where they are.
An ERP solution is a cost-effective platform that keeps financial and data management information in one place. It’s accessible from anywhere there’s an internet connection and helps those in professional services manage their financials wisely. When project deadlines are constant, professionals want to be able to stay focused on the tasks at hand. Since an ERP solution tracks costs and project progress, while regularly generating reports on these factors, entrepreneurs are always aware of the status of these elements that are crucial to the business.