24th June 2015

Is ERP Critical to Construction Success?

The construction industry continues to experience growth, however if this volatile sector doesn't continue to adopt innovative software solutions, it will be at risk of becoming stagnant. Here, we look at why ERP is critical to the success of construction businesses

Construction + ERP = Critical to Success 

As construction is one of the largest UK industries, it is imperative that we encourage businesses within this sector to innovate in order to secure our economy’s future. The industry is often described as “volatile”, which is why many have begun to adopt intelligent software that provides invaluable business insight, monitors and forecasts trends, and helps stabilise their future.

The recovering economy has provided businesses with the confidence and ability to invest in software that can produce a great ROI. As businesses invest in new innovative software, competition has begun to increase, which has further driven the adoption of Enterprise Resource Planning (ERP) software. Alastair Sinclair, Business Development Manager at Xperience Group, has been involved in the construction software sector for 16 years and said, “The evolution of the construction industry has seen a dramatic change in that today construction companies face the challenges of increasing competition, from both at home and abroad. Added to this, there’s pressure from expanding markets, along with greater customer expectations. Construction companies need to be efficient, shorten throughput times and keep costs down in order to compete.”

Why ERP?

New and intuitive technology, such as ERP, cloud, mobile and new self-learning systems are transforming our industries, enabling them to remain competitive. In the age of automation, we have been provided with great intelligence and deep data analysis that enables us to improve processes and aid growth. However, as businesses begin to realise that data is their biggest asset, and that they have the ability to do more with the resources they already have, competition will increase. It is the increased adoption of project centric, construction ERP software that will allow businesses to exploit the positive effects that new digital tools can provide. The adoption of ERP and demand for actionable and transparent data is something we reported on in an article we shared here

ERP is replacing a combination of finance systems and numerous spreadsheets that many construction businesses previously used. These legacy systems often result in the duplicate of data, which can waste a significant amount of time and money, but also leaves room for error. As ERP is a company wide solution, it ensures that everyone is working from the same up-to-date data, that there is only one version of the truth. Furthermore, it is customisable to each business’ needs, integrates with other software solutions and provides in-depth data analysis that enables you to make intelligent business decisions and drive growth.

The ERP Revolution

The development of ERP software is helping to stabilise the construction industry and drive success. It is critical for construction companies to introduce a state of the art construction ERP solutions such as NAVcontracts as this latest technology allows you to:

Compete: Interpret your business data, forecast trends, manage resource levels to improve efficiency, and maximise profits, in order to remain competitive. 

Save Time: By identifying areas of strength and weakness through interpretation of your data, you can streamline processes and make your operation more efficient, which provides you with the means to take on more work and keep the admin costs down. Furthermore by automating processes and monitoring your operations more closely, you can improve delivery and completion times. 

Save Money: By consistently monitoring every aspect of your business you can control purchasing and keep costs to a minimum, which will allow you to improve cash flow and profitability.

Go Mobile: Mobile and cloud capabilities allow access business data any time anywhere. As Alastair Sinclair states, “Mobile and cloud is becoming more important as the construction industry is looking at better ways to improve the ways their onsite and offsite staff can access and update their ERP systems to ensure continuity and reduce hold-ups.”

Comply with Legislation: NAVcontracts covers all the latest HMRC legislation relating to sub-contractors (CIS) and meets all of the relevant VAT rules. Added to this, the Miracle Payroll as part of NAV, meets all PAYE legislation. 

Go Green: Construction ERP software can help you monitor and record your carbon emissions effectively in order to comply with EU legislation. This is something that construction companies are being asked to look at as part of the conditions to win a contract. As an article on explains, “The Energy Savings Opportunity Scheme is the UK’s response to an EU agreement to cut emissions by 20% by 2020. The legislation, which came into effect at the beginning of the year, requires firms to audit energy use, identify a cost-effective energy savings scheme and notify the Environment Agency…” 

Attract Skilled Workers: To stabilise the future of your construction business you must accommodate for the needs of new employees. For example, Generation Z is reliant on technology, which is why you must demonstrate that technology is at the heart or your strategy and operation.

The growth of our economy depends on our industries ability to perform and construction is at the heart of it, which is why it should lead by example. Not only is Construction ERP critical to the success of the industry, but also the UK’s economy.

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