Construction SoftwareOctober 13th, 2010 by admin
What is “construction software ” or “construction management software”? And why do I need it?
Construction software is software that is designed and developed for the needs of construction businesses. Non-specific (or general) business software includes things like Microsoft Office (Excel, Word, Project, Access, etc.), and QuickBooks. Those programs are designed to be used by all businesses, regardless of what industry they are in.
General business software is good at serving common needs of many businesses, and, because so many people buy them, they can be priced very low. The down side is that, because they have to be flexible enough to be used in every kind of business, they cannot be designed for the needs in any specific type of business. The result is software that is effectively “electronic paper”; all the program does is provide you with a means of entering and storing information in a computer (rather than on paper). Sure, Excel can do formulas, and Word can format and print text nicely, and that’s better than paper. But not a whole lot better when you compare that to what you can do with software that is designed specifically for construction businesses.
So what is construction management software? Construction software is software that has been specifically designed for use in construction businesses. Construction software doesn’t just provide a means of entering and storing data in a computer, it also automates the business logic and procedures used in operating your business. In other words, construction software automates the “business system” that you use to operate the business.
What is a “business system”? A business system is the set of procedures that you follow in the daily operation of your business. In the construction business, you follow a set of procedures like:
Find a customer
- Estimate the job
- Submit a proposal
- Sign a contract
- Create a job schedule
- Request quotes for materials and subcontracts
- Purchase materials
- Schedule subcontractors
- Schedule employees
- Do the work:
- Customer requests change
- Request quotes for materials and subcontracts required for change
- Generate change estimate, issue change order
- Reschedule subcontractors
- Reschedule employees
- Receive bills from vendors and subcontractors
- Pay the bills
- Enter time sheets from employees
- Pay employees
- Submit invoices to customers
- Receive payments from customers
Well designed construction management software provides you with a system that automates the tasks required to operate your business, and integrates the data that those tasks use.
What does it mean to “automate a task”?
Let’s look at an example: Create an invoice to bill your customer for work completed. Using a manual system (paper, or general business software), you would have to make a list of all of the work items that have been completed. If you’re working on a cost plus or time and materials contract, you would have to then go and find the actual costs paid, or hours worked, for each item. Even if you are working on a fixed sum job, you would still have to do that for all of the allowance items. Then you would need to add the invoice to your customer’s job accounting, and the amount invoiced to your accounts receivable balance.
In a system that automates that task, all you would need to do is select a menu option to generate an invoice. The program would already know which items are completed (because you marked them as completed in the integrated scheduling system), which items are allowance items (because you marked them as allowance items when you created the estimate), and what type of contract the job is working under (because you indicated that when you created the job) and whether to bill estimated or actual costs. And once the invoice is generated, it would be automatically added to your accounts receivable balance, and to the customer’s job accounting.
So there are many advantages to automating business procedures:
- Everything you do in the regular operation of your business in a day, a week, a month, or a year, can be “systematized”. That means that, once you figure out how you want to do something, you can established a procedure so you don’t have to think about how to do it the next time.
- Because you don’t have to think about how to do everything each time you do it, using established procedures makes routine tasks go much quicker, and produces much more consistent and accurate results.
- Using established procedures allows you to hand off routine tasks to clerical staff and free yourself to do what the owner/manager of a business needs to do, which is to deal with things that come up that aren’t covered by your existing procedures. Hint: come up with another procedure to deal with it so you don’t have to take the time to think it through the next time it happens.
Using this approach of systematizing your business is the only way your operation can become more efficient. Since there are a limited number of hours in the day, the only way to make your business grow or become more profitable is to become more efficient.
One of the main features of construction management software is that it automates routine tasks, so the software provides you with pre-defined procedures. So, another way of looking at this is that when you purchase construction management software, you are not just purchasing software, you are purchasing a system of pre-defined procedures.
The other main feature of construction management software is that it integrates the data used in all parts of the construction business. In other words, rather than storing the same data multiple times, all data is stored in a central repository that is shared by all parts of the system.
There are many advantages to using a system in which the data is integrated:
- You only enter each piece of information once.
- The data entered can be validated by the program using business logic to improve accuracy and assure the integrity and coherence of interrelated data.
- Because data is only entered once, there is no discrepancies between data used in various parts of the system.
- When data is changed in one part of the system, the changes are reflected in other parts of the system that may be affected.
Now that we’ve covered the reasons for using construction management software, in future entries, I’d like to talk about specific aspects of a construction business operation, and how those are served by well designed construction software.