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Why simplifying construction cost management is critical
In the current construction environment, effective cost management is key. Here are three key benefits to automating the management of your project spend.
The construction markets in New Zealand and Australia are facing challenges that are likely to continue for some time. Global supply issues, supply bottlenecks, labour shortages and increasing demand for construction work are all putting pressure on the system. Material costs are ramping, timelines are being extended and profit margins are being eroded.
In any challenge, one of the best things you can do is to focus on the things you can influence or control. For construction projects, effectively managing project costs is key.
Effective cost management helps to minimise cost overruns and enables stakeholders to be kept informed about cost impacts in a timely manner. It will also inform decision-making for future projects.
Traditionally, cost management involves manual data entry and numerous spreadsheets. Using spreadsheets is very time consuming, subject to human error and removes focus from higher-value activities. Accounting software can help with managing accounts, but it is not designed to handle the complexities and specific needs of construction costing.
This is where project cost management software saves the day. Lentune’s suite of automation modules all work together to track your entire project spend. There are three key benefits to automating the management of your project spend:
1. Remove tedious manual work
Lentune automates all the repetitive tasks involved in tracking a project’s budget. Entering timesheets, expenses, purchase orders and invoices is all done automatically. Even the fixed costs associated with equipment are accurately allocated to each project, thanks to Lentune’s Yard module, which manages equipment bookings and allows you to charge equipment out at market rates. All these project costs are coded and integrated into the Lentune Projects dashboard. This means you can say goodbye to spreadsheets and manual budget updates. The entire procure-to-pay process is simplified with robust digital workflows and checks, saving valuable time, and preventing manual errors.
ABOVE: The Invoice Automation process - just one of the automated workflows that the Lentune platform provides.
2. Full visibility of costs in real time
Lentune integrates all aspects of a project’s costs. As a result, the project dashboard gives you full visibility of costs – including committed spend – in real time. As long as your team is committed to using purchase orders, there’s no waiting for payable invoices to arrive to know what’s been spent.
ABOVE: A screenshot of Lentune project analytics, powered by Microsoft Power BI.
3. Control over spend
By implementing purchase order automation and setting budgets against individual cost-codes, each part of the budget can be tracked individually. When a new purchase order is raised, the budget for that cost code can be checked. If the budget is reached or close to being reached, further steps can then be taken by the project manager such as raising a variation or pulling back budget from elsewhere.
ABOVE: Lentune's project dashboard keeps your budget updated in real time.
Automate project costs, in one clever platform
Lentune’s cost management platform helps New Zealand and Australian construction companies to streamline the way they handle project finances. Our software replaces time-consuming processes with automated workflows that create more clarity, control and insight than ever before. So they can refocus on what matters.
If you're sick and tired of tedious manual processes that aren't giving you the visibility you need to efficiently manage your project costs, contact Lentune today to request a demo. One of our team will be in touch to investigate if we can help you save time and gain clarity. So you too can put your focus on what really matters to your business.