How Automated Purchase Orders Boost Project Cost Visibility
by Lentune on 22 September, 2023
In the world of construction, where timelines are strict and margins are even tighter, keeping a close eye on costs is crucial for success.
Yet, too often, businesses are flying blind on future costs.
If you're relying on a manual purchase order system, you'll only be seeing the money that's already gone out the door, you'll never have a clear view of the costs that your team have already committed to and are on the way.
This is where purchase order automation becomes a game-changer.
Imagine a world where you can see into the future. Where you can see next months cost and start to plan for it. Not just knowing what you've spent; knowing exactly what's in the financial pipeline.
How much more clarity and control would that give you over your project financials?
In this article, we'll explore the ins and outs of purchase order automation and how it can totally transform your construction workflow, allowing you to move from reactive financial decision-making to proactive cash flow planning.
Let's get started.
How purchase order automation works
The era of cumbersome manual processes is fading. Gone are the days of manually completing paper purchase orders, scanning them or tediously entering data.
With automation, you can digitise and centralise purchase orders seamlessly:
- Digitised efficiency: Employees can now create purchase orders directly within the software platform, leaving no room for errors. All essential information, from vendors to prices and spending reasons, is digitally captured from the start, eliminating the need for time-consuming data entry.
- Centralised convenience: The beauty of automation lies in having all purchase orders unified within the same platform. Finance teams can access them effortlessly whenever needed, streamlining workflows and enhancing visibility.
The advantages of adopting this purchase order automation approach are plentiful — and we’re about to dive into a few of them right now.
Why automate purchase orders?
1. Streamlined Purchase Order Creation
One of the most significant benefits of purchase order automation is the dramatic reduction in the time it takes to create purchase orders.
Manual methods often involve piles of paperwork, extensive data entry, cross-referencing and approval processes. With automation, all this becomes a breeze.
Using Lentune automated purchase orders, your team can quickly create POs on their phone, filling out details like vendors, quantities, costs and cost codes all from our mobile app.
It’s that easy — no more paperwork or confusion for your guys. This streamlined process accelerates your project’s procurement cycle, enabling faster responses to project demands.
2. Real-time insights into committed spend
In construction, monitoring and controlling project costs are paramount. Purchase order automation provides real-time insights into committed spend.
You can easily track how much of your budget is allocated, how much is committed and how much is remaining, all at a glance. This real-time data empowers project managers to make informed decisions promptly.
There’s no more waiting for manual updates or sifting through spreadsheets to get a clear picture of your financial commitments.
3. Seamless approval workflows
Purchase orders often require multiple levels of approval. Without automation, this can lead to bottlenecks, delays and frustration for everyone involved.
Automating the approval workflow streamlines this critical process.
With predefined approval hierarchies, purchase orders are automatically routed to the correct people. Approvers can review and approve purchase orders digitally, from anywhere.
This not only saves time but also ensures compliance with your organisation’s policies.
4. Better spend visibility for finance teams
Purchase order automation significantly enhances the financial oversight of finance teams.
They can access a central dashboard of all purchase orders, instantly knowing which projects or departments are committing funds and what’s remaining.
This visibility enables proactive financial management. Finance teams can identify potential overspending or deviations from the budget early on, allowing them to stop budget creep before it blows out.
How to Automate Purchase Orders
Evaluate Your Current Process
Before embracing any new purchase order automation software, it’s crucial to evaluate your existing purchase order process.
Take a close look at the current workflow and pinpoint pain points, bottlenecks and areas where automation can drive the most significant impact. Are purchase orders constantly stuck in approval loops? Is data entry taking too much time?
By understanding the inefficiencies in your current workflow, you will be able to identify the features required in an automation tool.
Choose the Right PO Automation Software
Not all purchase order automation software is created equal. It’s essential to select a tool built for the unique demands of the construction industry.
Look for these key features and capabilities:
- User-friendly interface: Ensure that the software is intuitive and easy to use, as this will speed up the adoption process among your team.
- Integration capabilities: The software should seamlessly integrate with your existing project management software, eliminating data silos and ensuring data accuracy.
- Mobile accessibility: Mobile app functionality is crucial, allowing your staff to create purchase orders from anywhere, at any time on their phone.
- Scalability: Choose a solution that can grow with your business, accommodating an increasing volume of purchase orders as your company expands.
Wrapping it up
Implementing automation technology is more than just a trend; it’s a strategic move towards optimising your workflow.
By automating purchase orders, construction companies can reclaim valuable hours, enhance accuracy and gain control over budgets.
You’re not just simplifying a process; you’re revolutionising your approach to construction project management. It’s time to embrace the future of smarter construction workflows!
How we can help
At Lentune, we build smarter construction software to liberate your financial workflows. Our purchase automation software makes procurement easy and speedy. We'd love to show you how it works!
In a live demo, we can answer any questions and show you how Lentune could grow your business.