As construction companies expand their operations, a lack of integrated data can hold them back. Legacy technology systems often produce fragmented and siled data that contribute to errors and bottlenecks, including inaccurate labor costs, cost overruns and compliance risks. Adopting an industry-specific integrated technology platform can help construction business leaders solve these problems and scale their companies to meet their growth goals.
Construction companies face ever-evolving challenges
The construction business is dynamic and fast-paced. Business leaders must navigate operational complexity, fluctuating material costs, tight work deadlines, labor shortages, distributed workforces, and more. As a result, decision makers need access to real-time data and insights, especially as their businesses scale.
“Construction is a competitive and demanding business,” says Wyatt Jenkins, SVP of Product, Mid-Market, at Intuit. “Now more than ever, leaders of growing companies need to make informed decisions quickly and with confidence.”
At the same time, it is not uncommon for mid-market companies (including construction companies) to use different systems in different departments. according to research conducted by Forrester Consulting59% of mid-market companies struggle with non-integrated data repositories. When financial data is hosted in disparate systems, reporting and reconciliation takes longer, limiting executives’ access to accurate, real-time information and business metrics. This can slow down critical decision-making, negatively impacting revenue and growth. In construction, it can also contribute to:
- Inaccurate labor costs
- Cost overruns
- Inability to track project profitability
- Repeat mistakes
- Missed deadlines
- Compliance risks
The larger the company, the more likely data fragmentation will affect profitability. For growth-focused business leaders, alleviating these issues is critical.
For growing companies, fragmented data slows down decision-making
when Cornerstone Development Company launched in 2017, it was about a husband and wife team swapping houses. Fast forward, and the business has expanded to encompass five entities managing eight-figure construction projects and more than 70 full-time employees. As the company grew, the lack of data integration made financial management a significant burden and a stubborn bottleneck.
To solve the problem, Cornerstone invested in an ERP solution that would replace its fragmented systems and time-consuming manual processes with a unified platform. Consolidating its five entities with a shared chart of accounts and automated cross-company transactions eliminated time-consuming manual processes. Cornerstone also streamlined its time tracking and payroll functions and implemented AI-based insights to flag projects with below-expected profit margins.
Similarly, family owned Lallier Construction (LCI) found that after expanding to include four separate entities and five different internal divisions, a disjointed technology stack and lack of data integration created excessive work for its finance team. During a busy week, verifying the accuracy of intercompany transaction data took up to 20 hours of their CFO’s valuable (and limited) time. LCI’s leadership determined that they needed a centralized, integrated platform to serve as the foundation of their operations as the company continued to grow.
An integrated technology platform saves time and empowers decision makers
As Cornerstone and LCI discovered, streamlining business-to-business transactions and related processes can generate significant time and cost savings, in some cases as much as $147,000, according to one report. Intuit report. And this is just one example of the value that data integration can bring to construction companies. Intuit Enterprise Suite consolidates the company’s financial, payroll and project data into a single platform, enabling real-time insights, faster decisions and recovered revenue.
Improving data quality and improving reporting capabilities can facilitate more efficient month-end reconciliations, potentially saving 60% to 95% of the time spent on reconciliation tasks over three years.1 In addition, Intuit Enterprise Suite enables business leaders to consolidate financial systems and multiple accounts into a single sign-on, reducing screen switching, streamlining data entry for cross-business transactions, and reducing data errors resulting from manual entry. Within three years, companies can save between 75% and 95% of the annual time spent on data entry.
Cornerstone CEO Chad Shaules reports a significant decrease in the manpower required to produce CPA-reviewed financials for the company’s five entities since adopting Intuit Enterprise Suite. This has resulted in a 50% reduction in month-end closing time and significantly reduced the cost of external CPA audits. Meanwhile, the LCI team achieved a 90% reduction in cross-company month-end reconciliation time during peak season, as well as automating hundreds of invoices per month using multi-entity journal entries and 300% revenue growth supported by Intuit Enterprise Suite.
“Adopting agent platforms that have the ability to make robust predictions and can support data integration and automation enables growing construction companies to address the industry’s biggest challenges,” said Jenkins.
To learn more about Intuit Enterprise Suite Construction Edition, visit https://www.intuit.com/enterprise/construction/.
1 Based on a composite company with $12 million in revenue, 10 entities across multiple industries, 23 corporate employees, a CFO and two accountants, deploying Intuit Enterprise Suite with accounting, payroll and time functionality.
