Indian real estate industry has a ‘slow to change’ mentality when it comes to digitization. Technology adoption into various real estate project lifecycle stages can save the day for stakeholders and developers. Some of the technology tools that can boost project productivity include cloud based collaboration software, e-procurement tools and construction ERP software for process and workflow automation.
Digitization of processes like cost planning and estimation, procurement and vendor management, inventory management, real-time information access, predictive analysis etc enables efficiency across all stages of engineering, procurement and construction.
Overall, the real estate sector is facing reduced productivity, and excessive construction outlays because of:
- Lack of collaboration
- Resistance to digitization
- Inefficient project planning and estimation
- Lack of transparency and price opacity
- Credit Crunch
- Time overruns
Given the fact that all the above-stated issues are systemic and common, real estate developers need an immediate project management solution, in the form of a domain focused construction ERP software. Construction ERP software’s can help developers automate their project workflows to reduce costs, provide greater transparency and make their business more cost and time efficient. It can help them keep a tab on the physical and financial progress of their projects in real time by automating the project workflows.
Thus, developers can minimize manual intervention in different project stages and processes such as pre-construction planning, material procurement, and billing through automation, creating a more robust project execution strategy.
Construction project planning involves five phases – project creation, initial plan draft, plan execution, progress tracking, close out and evaluation.
With a construction erp in place, real estate developers can compile an all-inclusive list of associated project costs to further plan operations such as construction cost estimation, contract tendering and resource planning on a single platform.
Once the architectural design is completed, the software can help identify and develop execution strategies for budgeting, procurement and sourcing, tendering, vendor and material management and post award controls like daily progress tracking, reporting and invoicing. The software also allows shared access to project data and key performance indicators such as schedule variance, cost variance, and cash flow anytime anywhere across verticals.
Budgeting and Cost Planning
Specialized Real Estate ERP enables developers to prepare itemized Bill of Quantity (BOQ) with the help of millions of line items from the database.
Each of these database line items has a detailed rate analysis associated with it, which is used together with resource planning data to calculate cost estimates of overheads and prelims. A BOQ helps in detailed material estimation in terms of quality and quantity which aids in the tendering process by giving a complete picture of the contractors scope of work.
As a result, real estate developers can significantly reduce the project costs and other related expenditures by creating a low risk tendering environment which encourages the submission of competitive bids. An effective real estate construction erp enables developers to create granular construction budget estimates that helps in taking the right financial decisions at the right time.
Vendor and Inventory management
Construction procurement is the most capital extensive activity in the entire real estate project lifecycle. Having a procurement and inventory management software allows developers and contractors to automate their sourcing strategy and manage multiple users, projects and suppliers on one collaborative dashboard. In other words, developers and contractors can easily manage their bill of materials, RFQs, purchase orders, material purchases etc. for multiple projects and manage their procurement expenses better.
A Construction ERP also enables developers to have complete control over their procurement data by tracking real time comparative between budgeted cost, awarded cost, invoiced cost, paid cost and ‘balance cost to complete’ for various materials and projects.
With an end to end construction ERP software, real estate developers can gain complete control of their project lifecycle with the help of predefined modules standardizing the project, from pre- construction to closeout.
Having an end to end construction ERP allows developers to:
- Perform construction cost estimation and monitor the project’s cost, scope and time to completion through a consolidated process management platform.
- Access and share project information in real-time with all stakeholders.
- Encourage collaborative working between different project teams.
- Increase efficiency by standardizing execution methodologies and project strategies.
- Leverage technology to enable efficient scalability of operations and increase productivity.
- Automate construction procurement and inventory management for increased efficiency
- Predict the project’s cost to completion and delivery timelines through automated earned value analysis.
With increasing project cost overruns and uncertainty in timelines, real estate developers are now focusing on adoption of technologies to improve their efficiency, reduce costs and provide contemporary real estate solutions to their clients.
With construction ERP modules, developers can create custom-built dashboards with data analytics and data visualization functionalities, to help them make accurate cost estimations and record daily progress.
There are many construction ERP system available in the India today. However, not all of them are customized to meet industry specific demands. . Therefore, real estate developers and contractors should opt for a domain centric ERP software offering customization options according to their needs.
The key to selecting construction enterprise resource planning software for any business is shortlisting a platform that offers seamless working across various devices and provides increased security. Looking ahead, the number of devices that will be synced with ERP software is only going to increase; therefore, choosing a platform that offers optimal solutions and customizable options is necessary.