Simply put, your project management is not something you want to mess about with. You need the best tools and the best personnel to oversee the entire process.
But how do you go about taking this to the next level? What is advanced project management and what does it mean for your business?
Defining a base level of performance
Before we can accurately define the concept of advanced project management we first need to set a base level of what project management entails. At its most fundamental level, project management involves overseeing the development and deployment of a project and providing a centralised vantage point from which to ensure success.
Examining this in more detail, we can see that project management brings together planning, initial development, execution, monitoring, regulation, goal assessment and project completion. In other words, project management — as a concept — ensures the success of a project from start to finish, while project management software supports your people as they strive to bring projects to a successful completion.
A step beyond the traditional project management model
So, if traditional project management is already a comprehensive process, how can we go beyond this? Well, an advanced project management solution considers the key pain points that are currently affecting modern businesses.
These pain points include:
In some situations, a project may involve only your in-house team and perhaps a third-party contractor who is required to carry out a specialist service. If this is the case for your next project, great — you’ll probably find it easy to manage the operations of your own personnel alongside a straightforward contract for outsourced work and using your current system.
However, for larger projects with more than one external customer, and particularly in those involving multiple deliverables, this is often very different. Your organisation may be in the business of executing several different contracts at any given time – all of which may be based on multiple phases, fulfilling different requirements. You may not always have all the capabilities, plant and equipment needed for critical elements of the contract and so need to subcontract out some aspects of the work, adding to the complexity. Let’s not forget that all of these contracts need to be carefully managed too.
This isn’t easy to achieve with a traditional project management model and the basic inclusions of your typical ERP solution. Advanced project management embraces this complexity, bringing together all of these elements to provide a holistic management platform.
Unreliable revenue and cost recognition
A project is always an investment. Any project you carry out is executed on the understanding that you will receive a return on your investment in the future. However, problems begin to arise when one or more customers need to be billed for the work you are doing, the items you are making, the requirements you are fulfilling. And that then creates the sometimes complex task of accurately matching your revenue and cost associated with each project and contract.
This task is often part science and part judgement, taking into account a range of considerations in order to assess progress through each phase and deliverable, and across each of the projects your team is managing concurrently. Each business needs a set of guidelines and parameters in place that will help you recognise your revenue and costs in a consistent manner, for your own reporting purposes as well as complying to defined international accounting standards such as IFRS 15.
For accuracy you need to get away from the raft of spreadsheets and chance for error that so many businesses rely on for revenue and cost recognition. The tools you require to provide this consistency, the measurement of progress and compliance to standards are built into an advanced project management solution.
Too many sources of data
Integration, visibility, and collaboration are perhaps the three biggest drivers of pain during any project management process, and arguably represent the three biggest headaches for business owners.
Projects typically involve multiple teams working on different aspects of an overall set of outcomes. These efforts need to be unified to ensure that no elements slip through the net and that there are no unnecessary overlaps between teams. However, if the project management software is not integrated with, or, even better, built within your existing enterprise resource planning (ERP) solution, this can become difficult.
Indeed, in some contracts, not getting the right outputs to the customer at the right time and to the specified level of quality may incur significant penalties – not to mention have a serious impact on the customer’s experience (a situation we’re sure your competitors would love to see!).
If teams cannot work collaboratively across remote locations, or if they cannot view the status of other project elements and the potential impacts they may have, this makes management very challenging. Your operations may involve procuring raw materials, manufacturing complex machines or components, tracking labor and materials issued to jobs, and managing outsourced skills – or even whole pieces of specific work in a given contract. All these have to come together in the right order and to the correct spec – every time – for the customer to be satisfied and for budgets to be met.
If you are juggling some or all of these execution tasks and schedules in multiple systems that don’t talk to each other and you rely on in-house systems that don’t have a robust future, or on a mass of spreadsheets maintained by different people, then you’re going to have real trouble at some point. Even if you are coping today because of the exceptional institutional knowledge and hard work of a couple of key people, this is certainly not a system that will help you scale your business.
The best advanced project management solutions avoid this problem by integrating all these activities as a core extension of your ERP functionality, creating a single platform for effective management across each and every project.
Billing and claim mismanagement
Fulfilling your contractual obligations and tracking the actual budget progress of your costs as you do so, is vital in any project-based business. But if you are in the business of generating cash and profit from your projects, then managing costs in only one half of the equation. You need to make sure you get paid what you are entitled to as per your contract, and that you are raising claims or applications for payment as soon as you are able to do so.
Complex or large-scale projects often involve retentions released at pre-defined times or progress milestones, and visibility to them is critical.
Change orders and variations can often represent opportunities for additional margin, but only if you end up managing their execution very carefully and then charge the customer according to your contractual agreement.
Failure to manage the billing/claim/retentions environment correctly will only result in serious repercussions further down the line. Where margins are thin, controlling cash flows on your projects is a major factor in being able to meet those obligations on not just one project, but all the contracts you have in play at any given time.
Whether for core project deliverables or variations, getting the customer billed for the right amounts at the right time is critical to walking this tightrope.
With traditional project management protocols the manner of producing claims/applications for payment raised accurately and on time, reviewed and agreed to (perhaps in an adjusted form) by your customer and then invoiced correctly may be a very labor-intensive process that absorbs time from some of your very expensive people. Furthermore, while they are going back and forth, either with the customer or fighting their way through internal communications, those people aren’t out there making sure the projects are happening on schedule and to budget.
Advanced project management solutions work proactively to support the ongoing management of claims and billing across all aspects of a contract, making life far easier for all involved in the project execution and the critical finance functions (and ensuring you don’t go out of business in the process!)
Eradicate these headaches with the right advanced project management solution
Here at Precise Business Solutions we recognise the challenges that many businesses face when managing complex projects. We understand how painful these difficulties and points of friction are for businesses – how they can be costly, both in terms of time and direct loss of revenue, what the impact is on the experience you give your customers, and how they stifle growth and innovation.
With this in mind, we have developed the Advanced Project Management Suite for Epicor ERP. This solution fills the functional gap for businesses that have a need to manage complex contracts and multi-faceted projects within their Epicor ERP system. Epicor Advanced Project Management has been built directly within the Epicor development framework, extending the capability of your Epicor ERP solution to simplify the project management process, while providing the user experience, the same accounting integrations and with the same access to customising tools your team is already familiar with.
To learn more about the Epicor Advanced Project Management Suite, or to discover how the comprehensive Epicor ERP solution can benefit your business, book a time to speak with one of our ERP specialists or contact your Epicor customer account manager today.