Financial features

Once you've decided which areas are most important to your firm, you can start comparing the feature sets offered by competing software manufacturers. Here are some features to look for in two key financial areas.

Accounting

here are two aspects of accounting to consider: traditional accounting functions, like accounts payable and receivable, and job costing, the day-to-day tracking of all labor, material, and other expenses related to specific projects.

• Traditional back-office accounting needs of a construction firm aren't dramatically different than those of any other business: journal and ledger entries, income statements, payroll, and a variety of detailed financial reports are essential, but fairly standard across many software packages.
• The job costing component, however, deserves more careful consideration. First, the access requirements for job costing are very specific. Information is often entered in the field, whether by a project manager working on a laptop from a truck or a superintendent using a PDA while inspecting the project. Look for a system that takes these usage patterns into account and offers features to support them.

In addition, job costing has many feature requirements unique to construction projects: tracking labor and parts expenses, monitoring schedules and completion status, and managing invoices, contractors, subcontractors, statements, change orders, and more. Make sure the packages you consider offer flexible reporting and status tracking tools so you can stay on top of all of these areas.

If your emphasis is on saving money and improving efficiency, consider this area carefully. By implementing a new system, some firms see immediate returns of 4% to 5% in reduced costs.

Estimating

Another area important to many construction businesses is estimating. Submitting the right bid is essential to many jobs: bid too high and you won't get the job; bid too low and you may get the job but not make any money on it. Many elements of creating the right bid can be handled by estimating applications, allowing you to generate accurate bids more quickly and easily adjust the scope or materials to see how they impact your bottom line.

The right construction management software will make sure your estimates are competitive without jeopardizing profits. This is another area where the initial cost of the software can easily be recouped through improved revenues.

For the best estimates, you may need to access third-party cost data on similar construction products. Sources like RSMeans and Reed Construction Data can provide the data you need.