Posted by Jonathan Crowell
Q: What are the benefits of bringing Project Management into my accounting software?
A: This blog post will go into more detail, but simply put, project accounting gives you greater control to manage your business and ensure customer satisfaction.
Q: What are the benefits of bringing Project Management into my accounting software?
A: This blog post will go into more detail, but simply put, project accounting gives you greater control to manage your business and ensure customer satisfaction.
Business challenges for service companies
Service companies, without the aid of the right accounting software, will face the following challenges:
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The ability to successfully complete a project within scope is not always an easy task. Your client, upon signing a contract with your company, has expectations of budget and timeframe. You need to be able to manage the entire process to keep the project on track. It becomes challenging when you have to rely on multiple systems to do this.
If you have resources spread across multiple locations, be it employees or materials or both, you must be able to bring them together when needed. Managing various calendars and tracking inventory in different systems can become tedious. This may cause revenue leakage and minimal resource utilization.
If your employees in the field are entering their time and expenses in a separate application than where you process invoices, the billing process is slowed. Delays in the collection of payment adds to revenue leakage.
If you have resources spread across multiple locations, be it employees or materials or both, you must be able to bring them together when needed. Managing various calendars and tracking inventory in different systems can become tedious. This may cause revenue leakage and minimal resource utilization.
If your employees in the field are entering their time and expenses in a separate application than where you process invoices, the billing process is slowed. Delays in the collection of payment adds to revenue leakage.
The most common pain for project-based companies
Data silos are the most common pain for project-based companies. When you have disparate systems that don’t speak to one another, it forces your team to jump from solution to solution to find the information they need. This adds an error-prone task that unnecessarily consumes time from your staff. Patchwork systems have limited functionality and capacity.
How do you know if you’re experiencing this pain? Ask yourself: how much time do you spend in Excel each week? When you have to rely on spreadsheets to report on metrics, you aren’t seeing your data in real time. You also have audit issues because you cannot trace where the data is coming from.
Inconsistencies can arise not only from the above mentioned challenges, but from other business specific issues. When your team cannot not effectively complete a project it causes customer dissatisfaction. It increases the possibility of losing add-ons and referrals resulting in a loss of business and ultimately loss in revenue.
How do you know if you’re experiencing this pain? Ask yourself: how much time do you spend in Excel each week? When you have to rely on spreadsheets to report on metrics, you aren’t seeing your data in real time. You also have audit issues because you cannot trace where the data is coming from.
Inconsistencies can arise not only from the above mentioned challenges, but from other business specific issues. When your team cannot not effectively complete a project it causes customer dissatisfaction. It increases the possibility of losing add-ons and referrals resulting in a loss of business and ultimately loss in revenue.
How does project accounting work?
With Intacct, you can complete the entire project from start to finish – all in one system. The five typical steps of a project are as follows: 1. Initiate 2. Plan 3. Execute 4. Control 5. Close |
1. Initiate your project
First, you create the project in the Project Accounting module in Intacct. Determine its name, location, whether it is fixed fee or time and materials. Fill out all the information needed to initiate the new project.
2. Plan your project
Second, find all the resources necessary to complete the project. You can search by employee schedules, by specific departments or specialties, or by location. You can see the availability of all of your resources and allocate them accordingly. Then you create and assign the tasks that will be worked on throughout the project. You can create a task structure based on parent tasks. You also have the ability to mark milestones for billing purposes.
3. Execute your project
After you have planned the project, the third step would be to execute. This stage of the project is typically the longest as far as duration. Your employees are in the field completing tasks and working the project. Since Intacct is a pure cloud solution and web based, your employees are able to remotely access the solution (smartphones, tablets or laptops) to input their time and expenses.
4. Control your project
The fourth step of a project coincides with the third. As your team is executing each task, project managers are in control. Workflows notify approvers when time and expenses have been entered. Email notifications allow approvers to accept or decline time and expenses even while out of the office. Depending on the structure of the client contract, you are able to invoice the customer as time and expenses are accrued, milestones are reached, or a percentage of the project has been completed. The main objective of a project manager is ensuring the scope of the job. Within their customized Intacct dashboard they will see every project they are in charge of, the tasks completed and being worked and the budget to actual for each project. Dashboard are a great way to get snap shots of your business while having drill down capabilities.
5. Close your project
Once complete, the fifth and final step of the project can be performed – close. Since you are able to invoice directly from the same solution you are managing your projects, your collections are sped up. You have the audit trail to show everything that was done. Assessments can be performed at the end of each project within the Intacct project accounting module. Whether your project managers are PMI certified (Project Management Institute) or you appreciate discovering what worked and didn’t work, this is a very helpful tool. Assessments allow your company to improve performance and bring consistency to future projects.
Intacct can be your start-to-finish service delivery lifecycle solution. Beyond easily managing each project, all of your data is conveniently in one place, reporting becomes easy, employees are no longer tied down with tedious tasks or re-keying of data, and customers are happy because projects are completed on time and within budget.
For a more detailed look into Intacct's project accounting capabilities, check out our monthly Project Accounting Webinar or contact us.
For a more detailed look into Intacct's project accounting capabilities, check out our monthly Project Accounting Webinar or contact us.