When you should NOT be looking for new software

What could more apple pie than searching for a new construction accounting software solution for your company.

After all, it’s something you think you need and that would help your office get organized, run more productively as well as provide needed management information on a timely basis.

All this is certainly achievable. The problem is most users are not seriously looking. They just don’t realize it until the time comes to write the check   and go through the inevitable pain that comes with converting their data and learning a  new system.

Yes, it is a major commitment even for a small company.

Here are the some of the signposts that companies should keep in mind to find out if they are truly serious about acquiring new construction software.

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Construction Software Buyer Alert – Separating Fact from Sales Hype

If you have spent any time surfing the web for information on construction software, you may have noticed that all the vendors appear to be a good solution for just about anything you want to do.

In fact, most of them are probably are a pretty good solution for 97% of what you want to do. But it’s the last 3% that might just do you in. And that is where buyers can take a big hit.

When it comes to entering job cost transactions and running essential reports, most products are just fine. However, if you have to deal with any of the following, straighten-up and pay attention because these are items that separate the average vendors from the stronger ones. And these are areas that sales literature (or so called “Demo” CDs) will never call to your attention:

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Selecting New Construction Software Tips

Any company that is beginning the process of selecting and implementing new construction software hopefully understands the need to have adequate leadership throughout the process.  An individual or team must be selected to lead the process of evaluating, selecting, implementing, customizing, and training end users to use the new software.  These people need to have a large amount of knowledge about how the company operates as a whole, including intimate knowledge of all processes, as well as a good understanding of construction management software functionality.  As such, I have compiled the following lists of individuals that should be included in this team, or should at the very least be consulted with if they cannot dedicate the proper time to the entire process.  Additionally, I have listed several factors that should be a part of any software evaluation.

Input that is “Nice to Have” (highly recommended)

The following individuals are recommended to be included in the software selection team.  They may not need to be permanent members, but their input should be taken in to consideration.  In most cases, the size of your company, more than anything, will dictate how involved each member needs to be.

• End users (anyone that will ultimately be using the new software)
• Management (all levels in large companies)
• Accounting (they need to provide input on how the new software will impact their operations)
• Payroll
• IT ( they will need to know the technical aspects of the software implementation, among other things)
• Sub-contractors (if necessary)
• Suppliers
• Vendors (once selected)
• Other members that are deemed necessary, which will vary depending on each unique company

Factors that Must be Considered in Any Evaluations

Smaller companies, especially, will probably not have the time and resources to justify dedicating an entire team to a full-time software evaluation.  Additionally, the benefits in terms of process improvement that a formal team may be able to identify and implement will likely be less significant in smaller companies.

Thus, smaller companies need to make the most out of what resources they do have.  They cannot afford to be lazy in evaluating software any more than larger operations can.  At a minimum, the following things need to be thoroughly evaluated for each construction accounting software package that they consider:

• The number of varieties of each product and what makes each version unique
• The number of available vendors
• The history of the product, including testimonials from current users
• The history of the vendor, including testimonials from current users
• The functionality of the product
• The product interface and any potential issues that it may create
• The necessary steps require to integrate the new system with current processes
• Other factors that are unique to your company

Construction Software Causes for Change

At some point in time, every construction company begins to realize that their current construction software isn’t keeping up with their needs.  Over time, new processes are developed, new technology is implemented, and companies begin to have needs that their current software cannot meet.  As such, they begin to shop around for something newer, more powerful, and easier to use.

To help make the most out of your next purchase, I’ve composed this article that discusses the most common problems that companies experience that lead to changing software.  When looking at new construction management softare, make sure you keep these things in mind so that you don’t find yourself needing new software again in 6 months.

Functionality Problems: Perhaps the construction management software doesn’t offer the functions that are needed or the company has dramatically changed their processes and procedures such that new functionality is needed.  If the software you have or are considering is very rigid and not capable of adapting to changes, you’ll be forced to either find new software or delay making the necessary procedural changes.

Maintenance Costs: Improper or inappropriate data input can create all kinds of problems in a software system.  Sketchy reports, inaccurate statistics, and unnecessary frustration will result.  This leads to a need for continuous maintenance that can get expensive over time, or a sketchy workaround and manual manipulation of data that takes power from the system and takes valuable time.  Therefore, be sure to look in to how much it will cost to keep your system up to speed.  If it is too expensive, you’ll be shopping around for new software sooner than you’d like.

Impatience on the Part of Staff: When companies have to wait for accurate information (which can be a result of numerous factors), they often become impatient and feel that new software is needed.  When researching and installing new software, take the time to ensure that those issues are dealt with proactively.

Level of Vendor Support: It would be great if all construction accounting software performed perfectly from the instant that it is implemented to the day that it is replaced, but we all know this is not the case.  Therefore, the amount of support available from the vendor becomes extremely important.  If you buy software from a vendor with lackluster support, you may quickly find yourself searching for a new solution where you will get the support you need.  As such, researching the vendor becomes as important as researching the software itself.

On the other hand, there are countless examples of companies that think they need new software when the reality is that they simply aren’t using their current software properly.  End-users (those responsible for data input) must be thoroughly trained and constantly reminded about the importance of inputting accurate and honest data in to the system at all times.  If they begin to cut corners, your system will quickly become less functional and more troublesome to use, adding less value to your ongoing operations.

Construction Accounting Software Payroll Feeds – Internal or External?

The question about whether to receive data from an internal or external source is a good one, although there is no rule of thumb to determine what is best for each company.  However, the bottom line is that your data in your construction software needs to be accurate and stable since it will have a dramatic impact on your overall success or failure.

The truth is that the optimal solution will be different for every company.  Some construction companies will benefit from tracking payroll internally while others will be better off having this task outsourced.  The following factors will weight heavily in to that decision:

• The size of your company
• The number of employees you have on payroll
• The business acumen of employees
• The number of departments in your organization
• Your overall budget
• How available other alternatives are
• Business-specific parameters

Construction companies, more so than most companies, must keep a close eye on payroll impacts on projects and profits.  Decision makers need up to the minute and real time project data to make informed decisions, and this is only possible with a stable and powerful piece of software that has accurate data collection methods.

To put it another way, the more accurate and up to date your software is, the better you’ll be able to make decisions that will enable you to maximize your labor force and profit margins.

However, we all know that no business or part of a business will ever operate perfectly.  That is not to say that you should not strive for perfection, though, especially when it comes to maximizing the use and beneftis of your construction software.

With the right software, properly implemented, you will be able to constantly improve your processes and procedures with the constant goal of maximizing efficiency and working smarter, not harder.  This can be done regardless of where payroll data is collected, so long as all systems are integrated properly.

Since the software will only be as good as those that use it, it is imperative that you invest in quality training for all users when you purchase new construction management software.  Users need to understand their specific tasks and interactions with the software as well as how their input impacts the overall system.  In short, they need to be able to see the forest from the trees.

Concerning payroll, users need to understand the importance of accurate payroll tracking as well as any important federal, state, or local regulations that will impact their reporting.  They need to be able to see how their input has a “butterfly effect” on the entire operations of the business, and good software should be able to show this quickly and easily.

Finally, before investing in new software, construction companies are urged to ensure that their operations and standards are up to speed with current best-practices.  New construction accounting software will be designed with those in mind, so taking care of these modifications before installing new software will make the transition much easier, faster, and more effective in the short term.

Construction Management Software can Help Smaller Companies as Well

Although you’ll likely see a bigger percentage of large construction companies using an advanced construction software package, this kind of software is not strictly limited to applications in gigantic companies.  In fact, most smaller construction companies and contractors can benefit as much, or even more, from implementing and using a construction management software system.

However, for many smaller companies, the concern isn’t whether or not they can benefit from construction software but rather whether the investment is worth it.  Of course, there is not general rule of thumb that can be used to make this decision. Companies interested in pursuing a new software solution should conduct a thorough review of their options and make a decision about whether they will get the return they need to make the investment a sound one.  A similar concern arises in smaller companies who fear that they simply don’t have as much to gain from a new software package.  But, the bottom line is that today’s software can help automate key processes that can save any company, large or small, both time and money.

To begin, companies must determine if their current business model will work with the software that they’re interested in using.  If a complete revamp of the business will be required to make processes, etc. compatible with the software, chances are that purchasing new software is not the first thing that the business should do.  Instead, they should make sure that their business is structured to be in line with industry best practices so that when they do decide to purchase software, they will be “prepped.”

Most smaller construction companies and contractors do well managing their business on their own, using whatever computer applications make sense.  Perhaps they rely on office software or generic database software to keep tabs on things.  These programs are generally inexpensive, user friendly, and relatively powerful, especially for a smaller business.

As such, these little companies likely won’t benefit from high tech features available in some construction management software packages, such as RFID tagging and advanced real-time reporting.  Most small construction companies manage just fine using their own software or smaller construction software packages.

However, some small companies do benefit from advanced software.  If you find yourself considering a construction software package for your company, the first question you should ask is whether or not the investment in a dedicated construction software package is worth the money.  Will the improved operations cover the cost of the software and the cost to implement and train your staff to use it?  Of course, the answer to this question will depend on a number of things, such as what improvements you expect the software to give you as well as what kind of time frame you are considering for your success/failure cutoff point.  Review construction software comparisons to find the software that has the features that you need without extra bells and whistles that you’ll never use.

In either case, something good will come out of this investigation.  Even if the company does not decide to invest in new software, they will benefit from looking closely at their current processes, procudures, communication, record keeping, and so on.  Chances are that they will find some way to improve their business in this process, even if it isn’t buying new software.

How to Deal with Staff Reluctance to Change Construction Accounting Software

Deciding to switch to a new construction accounting software system is a big decision that affects almost everyone in your organization.  One group that is often overlooked in this process is the people that actually use the software on a daily basis.  Good software is useless if you have employees that use it improperly.  Often, these end-users do not see the point in switching software as the current software is something that they are comfortable with.  As such, they are often resistant to the change.  Here are some things you can do to make the transition smooth and encourage your end-users to quickly adopt the new system.

Everyone at the company must understand the benefits that the new software will provide for the company and themselves.  Before you make the transition to new software, speak with everyone in the company about what the new construction management software will accomplish for your company and how it will make things better for the company.  It is also important that employees see how the software will benefit them on a personal level in relation to doing their job more accurately, faster, etc.  Studies have proven time and again that new software is more successful in companies where all users understand the benefits.  Your worst nightmare is a group of employees who think the new software will only make their jobs more complicated and difficult.

It is also important that your company insists on everyone participating in a thorough training program.  Giving users the confidence to use the new software through training will reduce their reluctance to use the new software and will speed up the transition process.  If they still have questions and concerns with the new system, provide one-on-one training to ease their concerns.  Make sure things like phone numbers for support, manuals, and links to online resources are readily available.

Third, speak with employees about the new software and ask their opinions.  Get feedback on the good, the bad, and the ugly parts of the new software.  Not only will you be able to identify ways to improve current processes, but your employees will feel more valued as important pieces of the puzzle.

As your staff becomes more confident with the new technology, begin to recognize achievements.  Not only will people begin to realize some of the benefits that were discussed prior to the new construction software being implemented, but they will also be encouraged to expand their technological capabilities and confidence in using the new software.

Last, but certainly not least, it is important that management remains positive throughout the process.  Problems will arise and your staff will look to you to get cues on how to respond.  If you remain confident and encourage them to work with the new software to solve these problems, they will respond by doing so faster.  Remember to be a positive role model, no matter how difficult the implementation becomes.

Staying positive and making sure that everyone is clear about what is expected and how to do it are the best ways to ensure the smoothest transition to your new construction management software.  Given time, experience and confidence will grow among your end-users and sooner, rather than later, your company will begin to realize some of the benefits that prompted you to buy the new software in the first place.

Evaluating a Construction Accounting Software Vendor

Selecting new construction management software largely consists of evaluating three things:

• Product
• Software Vendor
• Technology

All three are important.  The main focus of this post is what to consider when evaluating the vendor.

Product
There are many vendors to choose from, and most vendor demos will be impressive.  The question is:  How do you know which is really the best choice for you? One way to sort things out is to look at other  important  considerations.  Relying on salesman assertions and product demos that are designed to show off their best capabilities can get you in to trouble…

Software Vendor
In addition to the product, you need to consider the software vendor’s training, support, product development, financial security, and commitment to the future.   Choosing a vendor to do business with is a critical component of the selection process.  It is critical to understand that your software provider is someone you need to feel comfortable working with both in the short and long term.  Below, I have made a list of questions that you should consider when evaluating construction software vendors.

The answers to many of these questions are not readily apparent.  They can take a great deal of time and effort on your part, but are critical to the long term success of your software investment.  Finally, if you are working with a dealer make sure you clarify if the answers pertain to the dealership, corporate, or both.

• How many different products do they support in addition to the construction software you are interested in?
• Are their salespeople experts at demonstrating the product and answering your questions?  How well do they know the industry?
• How many employees are committed to your product?
• What is their recent product development history?
• What are their plans for future product development over the next 5 years?  How much do they invest in R&D?  What new features have they released in the past six months? How often do they provide system updates beyond an annual update for tax changes?
• Do they use negative sales tactics that are disparaging the competition?
• How will they train you on the new software?
• How good is the quality of both training and support?
• Do they have a continuing education program?
• How long does it typically take to return phone calls for product support?
• How long have they been in business?
• How many clients do they support on your product?
• Are they willing to share financial information?
• Does the construction CPA community support them?
• Do they rely too much on maintenance revenues to sustain their business model?
• What do their customers have to say about them?
• What is their long term vision?
• Finally, what does your “gut feeling” tell you?  Is this a company you believe you would enjoy doing business with?

Technology
Accounting software is one of the first computer applications made available to businesses.   Consequently, there are a number of older products (legacy systems) that can have certain limitations and risks.   For example, although a legacy system may be very feature rich, it may lack the efficiency and depth that newer applications provide.   These can easily be identified with proper evaluation of the software.   However, what may not be so apparent is how difficult it is for the software provider to change and enhance the software.   After so many years, an application can become so cumbersome that certain changes become impossible or impractical.    Thus, keep in mind that the system you buy today may change very little over the years.  Changes of any significance may make the application even more cumbersome and error prone, making it difficult to work with.   In the construction industry, it is critical to invest in construction accounting software that will continue to evolve with your business and the industry.  Often, the main challenge is determining if an application is an older application made to look more current or if it is really a current technology.

Tips for Choosing your Next Construction Software Package

Once the decision has been made to implement new construction software, the goal is to make the process of selecting new software as easy and successful as possible.  A number of factors will need to be considered when you review potential software solutions.

Every company will come to the table with existing processes in place, regardless of whether or not those processes are the most efficient or are best practices.

However, in most cases, companies are better off looking for new construction software that fits their specific business models.  There are a number of commonalities in nearly all construction businesses that are accounted for in most software, so being aware of how well a piece of software matches with your unique business models is the key.

Construction projects all require manpower, materials, equipment, vendors, and other components that are similar for most projects.  Therefore, when selecting new construction software, make sure your new solution includes a user-friendly workflow module that will give you the ability to monitor and manage resources in real time with a certain degree of flexibility.

Workflow processes in the construction industry are pretty similar from company to company and many projects need the same resources to be executed effectively and efficiently.  Thus, although the workflow module is important to have, rest assured that most construction management software packages have a workflow module.

Additionally, construction software should be flexible enough to change orders when confronted with inevitable unforeseen circumstances.

Also important is to ensure that the new construction software has an integrated accounting module.  Construction accounting software gives companies the ability to track and control costs in real time.

Finally, consider the new software’s functionality in relation to field operators.  Many field supervisors use wireless devices to keep projects up to date and manage data.  If your company uses field operates to this degree, make sure that your next construction software package has web-based applications that will allow these activities to take place.

In searching for the next software for your company, make sure that you begin by mapping out the busineeses processes.  Once you can see how things are done within your organization, you can check to ensure that any new software will align well with your processes to provide your company the greatest benefit.

Selecting New Construction Software with End-User Input

When selecting a new construction software package, one of the most important things you can do is make sure that you involve an entire team in the selection process.  We’ve already talked about the importance of having a software champion, but more individuals need to be involved in the process from multiple departments within the company.

One group that is extremely to include in this group is the end-user community – those that will eventually be using the construction software on a daily basis.  They need to be represented in the software selection team and consulted with as they are the ones that will be using the software the most and will eventually have a key role in whether or not the new software “works.”

Depending on the size of the company and the size of the system, “end-users” could be a very large or small group.  If they span a variety of disciplines and have varying degrees of system privileges, you should do your best to ensure that all sub groups of the end-user group are represented and/or consulted with.  The bottom line is that anyone in the company involved with data creation, input, manipulation, or system maintenance needs to have a voice in the selection process through a single or multiple end-user representatives in the software selection group.

When soliciting input from the end-user community, be sure that all groups are considered.  Each company will be unique in regards to who uses the software and who does not, but in every case it is important to consider all involved with the software since everyone that interacts with the software will play a role in the eventual success or failure of the new system.

If proper care is taken in establishing the initial protocols of the new construction software functionality, the impact on the end-users should be on par with the latest best practices.  The other side of the coin to this statement is that all company procedures and practices must also be up to date with industry best practices for the software to do all that it can.

Keeping a new system healthy is also a concern.  In general, the more automation that a software system offers, the easier it will be to keep the system healthy, provided the end-users are using the new software properly.

Thus, if end-users are not consulted when new software is selected and instead are forced to deal with a change in which they had no ability for their voice to be heard, the chances for maintaining a healthy system will decrease.  End-users will likely take longer to learn a new system that they had no input selecting and may even resist change to the new system to show their resentment towards management for not valuing their opinion.

In the end, the end-user community is probably the most important part in whether or not the transition to new construction accounting software is smooth or not.  If they are not happy with the new system or are not involved in selecting it, the implementation of new software will likely not be a smooth process.

Additionally, the importance of training cannot be understated.  It is extremely unlikely that all end-users will be directly involved in selecting new software, so it is important to beging training end users on the new system as soon as possible.

Training can be the most critical aspect of how well and fast your company implements a new software system.  See previous posts for more information about the importance of training – here and here.