Netsuite is an integrated cloud-based ERP service for automating core business processes across industries, including construction.
ERP in the construction industry: services, integrations & deployment tips
August 22, 2023
ERP in construction is a specialized ERP platform that enables construction companies to manage core business processes, from raw materials budgeting and subcontracts onboarding to project execution and payroll. With 10+ years in ERP services, Itransition delivers scalable and cost-effective solutions to help its clients orchestrate key workflows and minimize operational risks.
About Itransition
50+ completed projects of different scales across various industries
Hands-on expertise in delivering out-of-the-box, custom, and hybrid ERP solutions
An Odoo Silver Partner
A NetSuite Solution Provider
Client spotlight
400%
growth in the platform use
Acumatica construction edition development
Itransition helped Acumatica customize its cloud-based ERP system to adapt it to the needs of the construction industry by streamlining document management, automating construction project management, and more.
2x
faster work order management
ERP for repair and maintenance business
Itransition deployed an Odoo-based ERP solution to help the customer reduce the time for the purchase order approval, automate the management of various enterprise processes, and accelerate work order management.
Key construction ERP features
Enterprise resource planning systems are modular solutions, so your company's needs, requirements, and goals define the choice of features. Here, we’ve outlined some capabilities commonly implemented by construction firms:
Contractor & subcontractor management
Automating general contractor and subcontractor management processes from onboarding to invoicing, to focus on project execution, profitability, and growth.
- Contractor and subcontractor data storage (insurance data, health and safety data, training and skills data)
- Contractor and subcontractor registration
- Quotation management
- Work orders creation and issuing
- Work progress tracking
- Tracking of billable tasks with completion status
- Tracking of scheduled and change work order statuses from request to approval
- Running account bill generation
- Performance monitoring
- Bill and payment tracking
- Analytics and reporting (contractor/subcontractor performance, rate analysis, snag list report, job costing, etc.)
Project management
Overseeing and managing all aspects of the homebuilding project (budgeting, estimation, planning, and execution) to deliver the project within costs, schedule, scope, and quality requirements.
- Project resource requirements and costing
- Project task update and completion tracking
- Project planning and scheduling
- Material issues and at-site work completion tracking
- Project progress forecasting
- Project budgeting
- Communication and collaboration capabilities
- Real-time reporting capabilities
- Mobile support
Inventory & warehouse management
Obtaining real-time visibility into actual inventory levels and automating inventory management processes to meet the demand, minimize inventory shortage and loss, and optimize carrying costs.
- Inventory tracking (low stock, location and levels)
- Returnable material tracking
- Material flow management
- Automated alerting (low-stock, expiration, shipment delays, etc.)
- Analytics and reporting (low-stock inventory, on-hand inventory, inventory turnover, goods receipt note, inventory used on a project, supply-demand analysis, etc.)
Supplier management
Getting visibility into the supplier collaboration workflows and automating supplier performance tracking and assessment, document management, and other tasks to ensure reliable partnerships and procurement cost savings.
- Supplier registration, grading, assessment
- Supplier performance monitoring
- Supplier risk monitoring and compliance audit
- Supplier contract tracking
- Supplier bid comparison and supplier selection
- Quotation management
- Purchase order management (creation, approval, status review, cross-checking of purchase against budget, etc.)
- Generation of material indents per project
- Analytics and reporting (supplier performance, top suppliers by value/quality/defect rate, purchase order analysis, supplier sustainability, supplier risk analysis, indents analysis, etc.)
- Taxing and compliance
Accounting & finance
Getting complete visibility into the company’s cash inflows and outflows and the financial health of each project for accurate budget management and transparent on-budget project delivery, analytics accounting, and more.
- Purchase orders (materials, equipment, and suppliers) tracking
- Managing contract invoices, general invoices, and applications for payments
- Project budget tracking
- Project estimates tracking
- Project costing tracking
- Accounts payable and accounts receivable tracking
- General ledger management
- Material budgeting
- Service budgeting
- Billing automation
- Payroll management
- Tax management (automated calculation and payment triggering)
- Loans and repayments management
- Profit and loss forecasting
- Project cash flow reporting
- Statuary forms generation
- Financial statement and costing reports
- Income-expenses statement
Document management
Automating the management of construction projects’ legal documents to ensure quick access to actual information, quality control, budget accountability, and schedule compliance.
- Construction contracts
- Compliance documents
- Bidding documents
- Contractor and subcontractor agreements
- Project schedules
- Floor plans
- Electrical drawings
Time management
Efficiently organizing the time set for the project completion, accurate billing and payroll, and improving the scheduling of future projects.
- Tracking onsite and offsite employee or team activity on a daily, weekly, or monthly basis
- Tracking time spent on projects, time off, overtime, late arrival, unscheduled absences, etc.
- Cost control and tracking per project, task, client, etc.
- Employee, job, and shift scheduling
- Analytics and reporting (work time utilization, billable and non-billable hours per project, employee productivity rate, etc.)
Are you looking for a reliable tech partner for your construction ERP project?
Essential integrations for construction ERP systems
ERP solutions should be well-integrated with the company's IT environment. To ensure uninterrupted data flow across all departments and business processes, we recommend integrating construction ERP platforms with the following systems:
Key integrations
CRM
BI software
Building information modeling tools
Project management software
Communication tools
CRM
Integration with customer relationship management software enables sales teams to access relevant data on the cost of work, project progress, and received payments quickly to manage sales relationships and customer service better. ERP-CRM integration also makes customer and prospect data (quotes, plans, agreements, invoices) available company-wide.
BI software
When integrated with business intelligence software, ERP facilitates advanced analytics capabilities for all authorized parties across the enterprise, automatic generation of custom reports and dashboards, planning what-if scenarios, and running predictive analytics and modeling.
Building information modeling tools
Safe and quick transfer of buildings’ virtual models from BIM to the ERP database aids in accurate construction project planning and costing. Meanwhile, reporting on construction issues helps prevent similar challenges in future projects.
Project management software
This integration helps oversee projects in progress, employees and teams involved, ongoing and scheduled works, and project timeframes for improved work scheduling, and task prioritization.
Communication tools
This integration leads to enhanced collaboration between different departments and employees, as well as a quick exchange of information between a company and its partners and customers.
Best construction ERP software on the market
Key features
- Finance management and accounting
- Service and marketing automation
- Human resource management
- Billing
- Asset management
- CRM
- Sales order management
- Opportunity management
- Planning and budgeting
- Revenue recognition
- Financial analytics and reporting
Limitations
- Price hikes in the long run
Odoo is an open-source, scalable, and flexible ERP system for high-growth construction companies in the small and mid-market.
Key features
- Project planning and controlling
- Procurement and subcontractor management
- Contact management
- Land acquisition and development
- Fleet and equipment management
- Accounting and finance
- CRM and estimation
- Equipment and fleet management
- Ecommerce
Limitations
- Being open-source, it requires sufficient IT expertise to maintain and scale.
Microsoft Dynamics 365
One of the largest ERP vendors for companies of all sizes. Microsoft Dynamics 365 is a flexible solution with strong ecosystem support.
Key features
- Inventory management
- Document management
- Project management and accounting
- Financial management
- Budget allocation and management
- Human resources management
Limitations
- Challenging implementation
- High cost
A major provider of ERP systems for various industries, Acumatica offers full-featured construction accounting software for mid-sized and small businesses.
Key features
- Project management
- Contact management
- Budgeting and job costing
- Contactor and subcontractor management
- Payroll
- Construction mobile
- Change management
Limitations
- BI and reporting is challenging to set up
- A steep learning curve
Infor CloudSuite
A highly customizable and configurable ERP solution for companies across industries, including construction and real-estate.
Key features
- Billing and costing
- Financial and accounting
- CRM and customer service
- Inventory and order management
- End-to-end project management
- Supply chain management
- Asset management
- Document management
Limitations
- High cost and complex licensing
- Unsuitable for multi-site construction organizations
Procore
End-to-end ERP solution tailored to construction workflows and designed for managing projects of all sizes end-to-end.
Key features
- Bidding
- Budgeting
- Contract management
- Document management
- Project management
- Field service management
- Site progress monitoring
- Financial management
Limitations
- Slow processing of graphic-intensive drawings and files
CMiC
Purpose-built highly flexible construction management software for small- and mid-sized companies.
Key features
- Accounting
- Human resource management and payroll
- Opportunity management and resource planning
- Equipment and inventory management
- Bid and procurement management
- Project management
- Drawing management and project controls
Limitations
- Not intuitive user interface
- Slow transaction processing capabilities
SAP S/4HANA
SAP S/4HANA is an ERP business suite that construction businesses use to integrate and manage core business functions.
Key features
- Financial management and accounting
- Customer relationship management
- Human resources
- Sales management
- Purchasing management
- Inventory management
Limitations
- Lack of flexibility
Construction ERP project lifecycle
1
Business analysis
Identification and analysis of key processes, workflows, and technology environment
Definition of industry regulations and compliance requirements
Elicitation of business goals, end-user needs, and expectations
Definition of software requirements for the future ERP system
2
Design & technology selection
Conceptualization of the ERP solution
ERP solution architecture design
ERP integration scope definition
Optimal technology stack selection
3
Planning
Definition of the project scope and deliverables
ERP projects scheduling and budgeting
Data migration strategy development
User onboarding planning
Risk management strategy development
4
Customization/Development
Customization of the off-the-shelf ERP or development of a custom ERP solution
Platform integration using custom code, pre-built connectors, or APIs
5
Testing
ERP functional and security testing
Usability testing of the ERP solution with focus groups
ERP performance and compatibility testing
Bugs and issues resolution
6
Deployment & handover
ERP solution deployment to production
Data migration from corporate systems and apps to ERP
User acceptance testing
User training and onboarding
7
Post-launch support (L1-L3)
Platform users and infrastructure support
ERP system fine-tuning in line with customer concerns or suggestions
ERP system troubleshooting
Technology upgrades
Сonstruction ERP benefits
Construction data consolidation
Automatic centralization of all data across business processes in an integrated secure database to enable real-time data transfer between departments and seamless access to the required records within seconds.
Accelerated project planning & management
End-to-end project visibility helps managers and executives plan effectively, define realistic project schedules, allocate resources, as well as manage projects across several locations without delays and cost overruns.
Risk management
Continuous project monitoring with real-time alerts and automatic tracking of compliance with state, national and international regulations to help identify and mitigate construction projects risks as soon as they emerge.
Accurate cost & revenue estimation
Generating accurate project estimates and quotes for successful bidding and accurate planning and management of the budget for raw materials, equipment, labor, etc.
Improved decision-making
Interactive dashboards, regular and on-demand reporting capabilities to help gain end-to-end visibility and real-time insights into business workflows get to support each decision with data.
Cross-department collaboration
Construction ERP simplifies the tedious and confusing information exchange process. It helps seamlessly connect your site and back office teams regardless of time and location for real-time collaboration, knowledge sharing, etc.
ERP for construction: considerations before the adoption
Deployment model
When choosing an ERP solution for construction, one of the most critical decisions is cloud or on-premises hosting. This decision influences the pricing model, solution scalability, hardware investments, deployment speed, and more.
- An on-premise construction ERP system is run on the company’s proprietary infrastructure, which means the organization faces high upfront investments in hardware, facilities, and an in-house IT team to manage solution’s customization, maintenance, security, upgrades, etc.
- Cloud-based ERP software can be deployed and scaled faster and easier, as the company doesn’t need to provide the IT infrastructure and in-house expertise. Many companies consider the subscription-based model an undeniable advantage; however, in the long run, the subscription fee and ongoing support and maintenance fees can get too high compared to on-premises ERP.
- A hybrid construction ERP solution, which combines on-premise and cloud ERP modules, is an alternative for companies looking to maintain the inherent scalability and flexibility of cloud solutions without losing the security of ERP modules running in-house. However, integrating and maintaining hybrid ERP requires advanced expertise and considerable investments.
The feature set
After outlining the desirable feature set, you must decide between ready-to-use software or a custom ERP solution.
- Custom ERP solutions, fully tailored to your business workflows, suit construction companies with unconventional business requirements. However, such solutions are more expensive than off-the-shelf ones and must be scaled vertically or horizontally when required.
- Off-the-shelf ERP systems for construction come in two shapes – packaged and modular. Packaged ERP platforms have all modules well-integrated and packed into one system. By paying for a license, you get access to all modules. Modular solutions suit companies who don’t want to overpay for additional functionality, because the owners can pick necessary modules and pay for them only.
Project cost
The cost of ERP implementation can vary from $50,000 to $1,000,000 for a mid-sized company. Such a price break stems from several factors that form the final price, among which are:
- Software license fees (depends on the deployment option, functional modules covered, user community, etc.)
- Hardware-related costs (in case of the on-premises deployment)
- Data management activities (data cleansing, consolidation, migration, etc.)
- ERP customization and integration with custom and third-party solutions
- Solution QA
- User and admin training
- After-launch support and maintenance, and more
You can get accurate ERP implementation estimation and enhance your project planning by resorting to professional ERP consultancy.
Project timeline
ERP implementation project timeline depends on several factors, which include:
- The number of business operations and processes streamlined by a construction ERP software solution (or the number of functional modules to be delivered)
- Construction ERP technology choice (custom or off-the-shelf)
- The required level of customizationÂ
- Construction software integrations
- ERP implementation methodologyÂ
If speaking of rough estimations, ERP implementation for a medium-sized construction company may take anything from 6 to 12 months; more accurate calculations may only be provided after a careful business analysis and ERP solution conceptualization.Â
Implement construction ERP with Itransition
Itransition delivers scalable and cost-effective construction ERP solutions as well as optimizes the existing ERP software to better digitalize and orchestrate core processes.
Itransition’s ERP consultants provide advisory support along the construction ERP implementation and optimization, helping you mitigate project risks and ensure high ROI by taking on:
- Analysis of business needs and technology environment
- ERP solution architecture design
- ERP software selection
- ERP strategy creation and roadmapping
- ERP implementation support
We provide end-to-end construction ERP implementation services that include all or some of the following activities:
- ERP consulting
- ERP testingÂ
- Custom ERP
- ERP migration
- ERP customization
- ERP support and maintenance
- ERP integration
Entrust your ERP project to Itransition
ERP implementation challenges we help solve
Resistance to change
Resistance to change
We can conduct user training and help you work out a change management strategy to ensure minimal resistance from the user community and a seamless user experience.
Budget overruns
Budget overruns
We don’t start ERP development until the project scope and interrelated costs are agreed upon. To help you find the most cost-efficient solution and be aware of the possible costing affecting your budget, we weigh on different deployment options and shortlist ERP vendors with a comprehensive overview of their products' cost structure.
Vendor selection
Vendor selection
Our ERP consultants constantly monitor existing and emerging ERP platforms to determine the flexible solution with extensive functionality and customization capabilities to meet all your specific needs.
Data management
Data management
Since ERP implementation implies data migration from other corporate systems to a central ERP database, we can take this opportunity to sort out irrelevant or redundant data and correct and add missing information to ensure good data hygiene and data reliability.
Data safety
Data safety
When delivering construction ERP solutions, we introduce comprehensive data security practices such as multifactor authentication, behavior monitoring, data encryption, and more to protect your corporate information.
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