Every subcontractor no matter the size needs an accounting software package and a project management package. I have worked in small as well as large subcontracting companies and it is universally true, no exceptions, these two packages are essential. If you think differently you are only fooling yourself. Whatever the trade, the idea is to make money. In all my years I have been in the business I never met anyone who loved to build so that they could lose money. In order to make money you need to know where you are in terms of each individual job on a weekly basis and just importantly where you are going.
In this article I am going to discuss one of these packages, the project management package and in particular the one I have used for years Primavera Expedition. I personally have no connection with Primavera except as an end user. I am not employed by Primavera or Oracle , do not receive any remuneration from them for any reasons. I am simply an individual who has used their system for years and really appreciate what it can do for a subcontractor. In my opinion it is not hype to say Primavera has great software packages.
In my book, COMMON SENSE SUBCONTRACTING WITH ELM JOB COSTING & MORE which is due out this fall a section of the book discusses Primavera and goes into detail on what data is to be collected and the reports you need that are generated from this data. The book has specific examples of each report and explains each one in detail. All in a language any subcontractor can understand. They are an excellent guide for any subcontractor who wishes to implement a project management program and just as important if not more important a job costing program. Some excerpts from my book can be found in this article as well as additional writing.
There are many project management programs out there and all have their good and not so good points. If you are a tiny startup company you can do your books the old fashioned way without a computer although I would not recommend it. If you start at the very beginning with a packaged project management software system you will have the ability to custom tailor it as you go along. More importantly if it is part of your start up and tied into your job costing you have greatly enhanced your chances for success. Most of the canned software packages are relatively inexpensive so they are not cost prohibitive and they are worth the investment. You need to think of them as a power tool. If you are a mason you never give it a second though to buying a power mixer as it’s an investment that will pay big dividends. Just like the HVAC contractor buying a Ridgid 300 as opposed to having his men cut and thread by hand. Same thinking, except this program is the business side power tool to help you succeed. Go on line you can review the many project management software programs that are out there and make a choice that you feel best suits your company. In my early days we did it by hand and developed spread sheets that looked like bed sheets and as time moved on and the computer came into its own we went down that path.
As software programs developed and became more affordable and user friendly I like so many other construction people gravitated to Primavera for the project management side. I do not mean to imply that it is the only software package available that has any value; the simple truth is it is the software package I am familiar with and have had great success with. In addition a great many subcontractors use it. An individual just needs to perform the due diligence before settling on the packages best suited for his company needs.
Before I go any further I must advise the reader not to be intimated when they look up Primavera on line or when they meet one of their representatives. Primavera web sites, like their programs are frightening in size, scope and complexity. They can scare even the most experienced. Between the computer jargon and the unfamiliar technical language of the techies whose terms for construction items can escape even the most experienced construction individual any sane individual will want to run for the hills. Be patient, take it one step at a time. It really helps to know what you want before you start and I hope I can help you narrow down what you need to begin.
All of Primavera’s programs are excellent but they produce an enormous amount of data. To quote Lee Iacocca, “The biggest problem facing American business today is that most managers have too much information. It dazzles them and they don’t know what to do with it.” The problem is compounded when one day you have no data and the next day you are flooded with data.
So to be successful you need to know what you need and what you can do without when you start. It is my opinion the three things you need in any successful project management program that will lead to successful job costing are: one, complete reporting on the status of your change orders two, submittals and three, Requests for Information. Primavera Expedition does an excellent job in these areas. With a minimum of data input reports are generated that give excellent snap shots of the status of your change orders, submittals and Requests for Information. If you are small and working alone it will tell you if you are doing your job properly and if you are bigger and have people working for you if they are doing their jobs properly.
Think about how important knowing the above is. No one can stay in business long performing extra work to the contract without getting paid. Nor can anyone survive by putting the same work in twice because what was first installed was not approved by the owner. And finally without timely answers to questions about vague or confusing sections of the project documents no contractor can install their work in a timely and cost effective manner. In this business knowing is everything, its ELM’s Job Costing mantra.
Continued next week.
Related Blog Posts: