Advantages of working with ERP systems for construction companies | FirstBit blog
Contracting ERP

Advantages of working with ERP systems for construction companies

BY FirstBit | Published 27 July 2022 | Updated 6 October 2022
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Advantages of working with ERP systems for construction companies

Industrial automation is changing the way we live. There is hardly any industry left that is unaffected by the impact of technological advancement. The most important proof is the rapid adoption of ERP software by businesses.

Every construction business is concerned about losing out on business opportunities to its competitors as the market becomes increasingly customer-oriented and competitive. 

Over time, the size of the business became less relevant. It is because no company can ignore the capabilities of ERP, and they would be unable to survive without adjusting to technological advances. So by now, you must be wondering what the benefits of an ERP system are? 

The following are 9 key benefits of ERP for the construction industry:

1. Data Optimization

One enormous challenge every construction business faces is managing data. Organizing all the data without losing any can be a very tedious and confusing task due to the large amount of data that companies typically deal with.
Regardless of the amount of data you deal with consistently, ERP software creates a centralized hub for all your data, thus making data transfers between departments fast and secure. ERP can store data more efficiently, and you will be able to locate the correct records in a matter of seconds.  
Organizations are complicated entities involving many factors frequently used across different workstreams, and having a standardized platform that combines these processes into one storage system allows data to be easily managed, thereby increasing efficiency.

2. Intelligent Planning & Analysis

The various ERP features and advanced functionalities enable companies to track simultaneous operations and report and manage deficiencies across departments more accurately and efficiently. Additionally, by dynamically analyzing financial and operational data, executives can access more precise and accurate real-time information.
Several reputed global companies have suffered heavy losses due to untimely completion of projects and inefficient planning within an architectural firm. As a result, employers incur enormous labor costs and client losses, resulting in massive losses. Delay in the delivery of projects also reflects poorly on the goodwill of a company. 
You need to develop a more stringent project management mechanism when dealing with multiple projects from numerous clients, which is impossible to achieve manually. 
Implementing integrated construction ERP software helps minimize downtime and contractual issues with clients throughout the project by controlling expenses and budgetary allocation. An accurate analysis of raw materials, effective workforce utilization, and architectural design are necessary for proper resource allocation.
Furthermore, companies can use ERP in construction to plan for collateral expenditures and budget the project's finances. Throughout the project, this avoids unnecessary downtime and contractual complications.

ERP for construction companies

3. Project Management Optimization

It has always been challenging for construction managers to distribute assignments and track the progress of projects across several work locations. However, ERP systems can simplify monitoring the status of various activities in a way you never thought was possible. 
ERP system automates data tracking, streamlines project information, and helps you manage projects more efficiently. With an ERP in the construction industry, you can easily track a project's status, delegate tasks to the appropriate staff, identify raw materials requirements, select supplies, and simplify project management. 
Furthermore, project management capability makes it easier for them to bill customers. As a result, an ERP system is an excellent tool for improving sales team productivity.

4. Estimation of Construction Costs and Revenues

Each client has different priorities, so estimating all aspects of the project is essential, as the winning bid depends on the design submitted, the reputation of the company, and the customer's economic feasibility.
The application will also correctly calculate overhead liability when a project takes many months to complete. You can deliver accurate cost estimates to your clients where the actual cost does not deviate significantly from the calculation.
ERP software simplifies the process of generating quotes because it enables you to incorporate critical parameters like raw materials, labor costs, design, and duration into your estimation to estimate the project's price accurately. 
Simultaneously, construction ERP software also allows you to track the amount of revenue and loss for each project.

FirstBit ERP System for construction companies

5. Facilitating Information Sharing

When larger construction companies handle many Projects simultaneously, the exchange of information becomes tedious and confusing. Excel spreadsheets and PowerPoint presentations can be very inefficient and impractical, in addition to not being safe.
Enterprise resource planning software simplifies processes such as seamless data sharing and improving the quality of content while maintaining clear communication between employees, resulting in more effective teamwork, more precise outcomes, and more robust teamwork patterns.
Data access becomes more secure with ERP software through using the latest cloud platforms and firewalls that support optimal data security. Additionally, contractors can set restrictions on the data they share with clients or employees.

6. Diversification of Business Processes

Business processes are divided into various modules under an all-encompassing ERP solution. However, as construction companies have become increasingly aware of ways to improve stability, risk management, cost-effectiveness, and other operational aspects, restrictions have plagued them at every step.
Thus, construction ERP software has been divided into architectural design, contract management, project phasing, inventory management, marketing, HR management, and accounting and financial management. 
It facilitates better process management and enables the system to comply with regulatory requirements.

7. Enriching Decision-Making

An ERP system will give you a better picture of business operations, aiding in quality decision-making before making conclusions. ERP software assists staff in extracting data from various sources and provides relevant criteria the team must modify before fulfilling requests. 
With the system, you can review all the case details, ensuring that nothing is overlooked during the decision-making process. In addition, an ERP system has inbuilt chat forums and video capabilities for employees to communicate effectively.
It will assist you in extracting all the essential details from various sources and determining the proper criteria to apply before fulfilling a request. 
Purchasing raw materials is an excellent example of this. In this case, many parties are involved, and the team should give the budget report to the project manager established on the engineering team's recommendation. 
Afterward, the purchasing manager creates a purchase order based on the design and sends it to the accounting department for approval. 

8. Increasing ROI ( Return on Investment )

The ERP software helps you with operations management, streamlining your supply chain, and other business processes to provide better insights into what's happening. 
Consequently, you will be notified of the upcoming issues arising in the business and can prevent them quickly to minimize their impact. Therefore, with a capable ERP system, you can spend less, maximize profit, and stay competitive. 
ERP software in the construction industry helps construction & infrastructure firms reduce manual, time, and labor-intensive processes, control raw material and employee expenses, reduce unnecessary operating costs, eliminate downtime, and achieve maximum ROI.
The construction ERP software integrates information from every aspect of your business and gives you real-time data and reporting. It allows you to anticipate or catch things like cost overruns before they impact your profitability.

9. Enhancement of the System's Efficiency

When employees need to gather data from different sources, an ERP solution makes it easier to extract data and display relevant requirements that need to be met before a query is closed. This improves efficiency by providing a consolidated view of the scenario and the relevant decision-making criteria.
When the project manager decides to purchase a specific raw material, the budget report is given to him; based on that, the project manager consults with the engineering team and formulates a construction design. 
As a result of this design, the purchasing manager creates the purchase order, which the accounting department subsequently reviews before approval.
Without an ERP system, interdepartmental transfers and correlations of these reports, along with back-and-forth revisions and real-time monitoring, would be much more difficult.
FirstBit ERP System for construction companies


There are several aspects to consider in assessing information collected after analyzing market trends and growth prospects. First, it is essential to understand how ERP can positively impact the construction industry instead of the hindrances that impede success.

ERP software allows construction firms to eradicate manual, time-consuming, and labor-intensive processes in today's competitive business environment. Thereby controlling raw material and employee costs, reducing IT costs, eliminating unnecessary downtime, and taking care of deadlines. An ERP system has inbuilt chat forums and video capabilities for employees to communicate effectively.

Construction ERP Software: Picking the Right Software

FirstBit ERP software consists of modules that support the optimization of overall construction business operations. 

These modules include project and contract management, accounting, inventory, asset management, sales, CRM, payroll, and HR. 

As a result, the system is versatile and suitable for businesses of all sizes & it offers a broad range of easily accessible and cost-effective features. 

Get in touch with First Bit today!

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FirstBit ERP is a single digital environment for your team to ensure timely and profitable project completion. Contact us to get a free consultation and quotation for your business.

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