Many of the trends in business today come from the software industry. This is both because technology plays an increasingly important role in business, and because some of the most prominent businesses today are software-based. This has led to many software-industry concepts bleeding over into other lines of business.
One of those concepts is project-based operations. Instead of fixed roles and responsibilities, operations are broken up into projects with self-organizing teams. Each project organizes a little differently depending on need and personnel.
Many businesses now are experimenting with this type of organizational structure, or already have fully adopted it. Aside from project-based organization representing the zeitgeist of the age, this type of business organization also allows for greater agility as things change (and business is changing pretty fast right now), it takes advantage of employee skills better, and it leads to a more satisfying work environment overall for greater employee retention.
Of course, project-based business organizations are not new. Many industries have been using it for years, including accounting and law firms, marketing agencies, construction companies, and event management businesses, among others. But with the need for faster adaptability and better use of employees, the project-based business organization has spread beyond industries that naturally have been using it for years.
ERP Helps Project-Based Companies Improve Effectiveness and Efficiency
Project management software such as Asana or Clickup can help businesses get started with project-based organizations. When a business goes beyond the testing stage and more fully adopts this style or organization across the company, however, it needs the right infrastructure in place for ongoing efficiency and effectiveness. Individual projects can use Asana, but project-based companies need ERP.
Three primary areas make ERP essential for a project-based company.
1. Reducing the Complexity of Project-Based Organization
ERP comes with the traditional capabilities of project management software, but it also helps integrate these projects into a larger whole better than standalone project management solutions.
First, ERP encompasses all the main tools needed for project management, including task linking, dependency management, project dashboards and visualizations, role assignments, resource repositories, notifications, and automation.
But ERP also connects this data in real-time with other areas of the business such as finance, accounting, inventory, and human resources so all projects can be overseen and coordinated as a whole for a complete picture of operations.
2. Enabling Project-Based Accounting and Financial Management
The budgets and costs associated with a project must be understood and managed both on the project level and as part of the business overall. This juggling act between individual project accounting and overall company accounting is possible with ERP.
ERP helps project-based businesses monitor project budgets and expenses, utilize forecasting and cost management, control project documentation for billing, and manage cash flow both on the project level and for the business overall.
Businesses can drill down to see how an individual project is impacting revenue and budget, but also easily get the big picture for the project-based company at the same time for a real-time picture of overall business performance.
With an accounting system built for project-based organizations, businesses also can easily and automatically break down and assign costs by project, and automate invoicing and payment tracking.
3. Improving Client Interactions Through CRM
The CRM component of an ERP system helps project-based companies more effectively manage client communications and track interaction behaviors. Because ERP encompasses all parts of the business instead of just project management, a project-based company can better integrate its marketing, sales, and customer service components with project-based work through the sharing of project and CRM data natively.
CRM can help project managers better coordinate with sales, marketing, and customer service, and give account managers better insight into the progression of a project. Marketing campaigns and sales efforts can be triggered by project performance, and data can be shared among project teams more easily.
Project implementation speed also can be improved by linking finalized sales with project teams.
Many Projects, One Business
Project-based businesses need flexible tools for organizing around diverse project needs. But at the same time, they need these projects to unify for overall resource utilization, business insight, and financial management.
ERP delivers this balance between individual project coordination and overall business management. By serving as a unified backend infrastructure that connects all parts of a business and serves as a single source of truth for company data, ERP enables project-based businesses to organize around projects while maintaining visibility and efficiency for the organization overall. Standalone solutions can assist with any given part of a project-based business, but only ERP can manage them as a unified whole.
To learn more about how ERP can help with project-based company management, see our solutions for Professional Services businesses or contact one of our experienced consultants at (801) 642-0123 or by emailing us at firstname.lastname@example.org.