You need to understand your project accounting costs to see how truly profitable your company is. This knowledge isn’t lost on companies as they seek to understand these costs and the data surrounding them. This effort enables companies to identify financial issues early and correct them before they become a problem. This is why field service software like Fieldpoint comes with job costing tools built into the core software. This takes your project management software to a whole new level.
The focus on understanding accounting costs isn’t just about constantly looking at costs. It’s about measuring profit margins. It’s more than volume discounts and cost overruns or properly managing inventory. It’s complete project management from the start to the end of your project. And that can only be achieved with a project management software that has complete control of your projects.
Field services businesses need to track historical data, so they can go back and validate their profit projections. They need to make sure these projections are correct and look for ways to more accurately create these projections.
The overarching idea is that field service businesses validate the margins of the different parts of a project. And they use that data going forward to set up new projects. In essence, they’re using what they’ve learned from their field service software job costing tools to do the next project better.
Here are five ways to manage project accounting costs with field service software accurately.
Understand that time is money
It’s the age-old business idea. Time is money and every moment a technician is working is costing someone. That is either going to be the customer or you, depending on your quotes and estimates. Tracking payroll, billing, project management, and strategy costs is important to balancing costs. You don’t want to quote your customers a cost for a project and then have it overrun and go back and ask for more. That won’t win you much business in the future or help you retain customers in the long run. That’s why field service software comes with project management software and job costing tools.
This way, you can estimate how long each task is going to take in a project, what manpower you will need and how many hours they will work. Properly track your payroll costs with field service software and go into project bids with an accurate account of how much it will cost to do the project.
Use key performance indicators to measure intermittent success
KPIs measure an organization’s progress toward set goals and can make a huge impact in a positive way when monitored and applied correctly. If you are going to run projects and installation, you need to keep to your goals and timelines. After all, if you tell a customer you will be finished by a certain day, you need to hit your goals to get there. So, with a field service software, build custom KPIs that track the success of your technicians. Make sure they are completing tasks on time, getting to the job site, and meeting their goals. If you let them slip, the project’s timeline can slip along with them.
It’s also important to take on projects that make money. That may sound simple, but some field service businesses take on projects in hopes it will lead to contract work. With equipment project margins falling, the field service industry is seeing more value in the recurring revenue of preventative maintenance. However, if that revenue isn’t there, then you are losing money on project work without recouping it elsewhere. With field service software, you can track the financials of projects and what they turn into. Did you win service contracts with the project? Were there more repairs and emergency calls? Did they use you to upgrade? If you are going to make no profit on a project, ensure you have the KPIs in place that tells you that you are making money elsewhere because of that project.
Estimate accurately with field service software and adhere to your estimates
Many companies don’t handle their bidding process well. By using the formula [(E-A)/E] (E = estimated hours to complete a project, A = actual hours) companies can accurately plan future projects. With project management software, take estimating deeper with your projects. Don’t just estimate when it will start and finish, break it down to each task and each job in that task. After all, the deeper you go in project planning, the more accurate your estimates will be.
It’s also important that if you are job-costing a project that you don’t overrun your costs. Firstly, it can be expensive and hurt any profit margin. Second, it could put a strain on your relationship with your customer who has to pay the bill. And finally, it can be avoided by using field service software to do proper estimates. Keep your projects on-time and on-budget and be known as the business that gives the best and most accurate estimates.
Quality data in = quality data out
In order for project accounting costs to be accurate, the data put into the system has to be accurate. It’s imperative that all employees follow this mandate. With project management software and mobile field service apps, your technicians can input time right against a project. They can use the mobile app to input time, or timesheet portals to accurately account for each hour they work. Regardless of their task or job for the day, time against a project can be properly tracked using field service software. And everyone will use the same system or portal, keeping your project’s data at the highest quality.
Gain visibility with project management software
Project managers should be handling data entry to ensure costs are measured correctly and the data remains accurate. They need a field service software that gives them all the tools to bring a project to completion. That’s because there are so many moving parts when it comes to a project — parts and equipment to buy, equipment to move to the job site, people to schedule and billing to set up. With so many moving parts, give your project management a project management software to gain visibility into their projects. From start to finish, let them see every aspect, every task down to the job, and where the margins are. By keeping an eye on these, project managers can make smart decisions to bring projects in on-time and on-budget.