An Integrated Cost Management Solution (ICMS) is not only a major component of construction but also provides a perfect gateway to exchange data with other members working on the project. Cost management is an essential component in any project environment, especially when managing resources and production on a tight budget and constrained time frame.
A recent case study showed how a leading EPIC contractor, PETROSERV implemented a cost management solution to help align its construction and technology processes in order to achieve greater accuracy across projects.
Petroserv identified that improved project cost control would enable it to operate more competitively within the construction industry. However, as an EPIC contractor, Petroserv manages vast amounts of data with a multitude of IT systems from project concept through construction operations and accounts. As such, accurate cost management was complex.
CCS analysed the business need and implemented a real-time operational and cost management solution that have had a significant positive impact on the productivity and cost management of projects for Petroserv.
THE BUSINESS CHALLENGE
Situation: As an EPIC contractor, Petroserv is responsible for integrating all parts of a construction project from conception to production. Across the industry, increasing pressure to deliver construction projects with greater cost efficiencies, is forcing contractors such as Petroserv to review their operation and technology processes. Petroserv thereby identified a need to better align its technology with its construction business requirements in order to improve the monitoring of projects and identify areas for improved efficiencies.
Findings: After the initial consultation, CCS consultants identified two core areas for improvement; first principle resource budgeting linked with project planning and, cost management from site request and procurement to payments.
Given the fluctuation of costs and labour within the construction industry, real time management of contract cost and allowable was identified to be essential for effective cost management and improved accuracy of data.
The challenge: A mandate for change was established requiring an audit of the existing ERP system and business processes. Two new systems; Candy and BuildSmart were to be installed with minimal disruption to existing projects and required quick integration through CCS with the help of Petroserv employees.
THE CCS SOLUTION
How it worked: CCS installed both the Candy and BuildSmart products to streamline business costs and allowable to activities and allow for greater accuracy in reporting throughout the lifecycle of a project.
The Candy and BuildSmart products was installed in response to a need by Petroserv to more accurately manage the dynamic link between money and time, actual vs allowable thereby providing a wealth of information to the construction management team regarding spend detailing operational efficiencies and also inefficiencies experienced providing the opportunity to improve processes moving forward to positively effect the project outcome.
The BuildSmart product including; accounts, site costs, procurement MOS, payroll wages and HR, equipment and asset management amongst others were implemented in response to the challenges of compiling project cost information across many different locations and the variances associated with this.
As an integrated solution, Petroserv now has access to real-time construction project information which is held across the company.
How it helped: CCS products enable real-time information at all stages of a project, from cost estimate to live running. As the CCS products are designed to integrate, it is possible to monitor each stage of a project as well as monitor the project holistically. The depth of accuracy provided through real-time monitor of projects provides deeper insight into project cost control and, when required, quick rectification.
Unique to CCS is that the business consultants have a depth of industry knowledge and so are able to consult to the client’s business needs first, then identify the technology solution that best fits that need.
Following the installation of the Candy and BuildSmart programmes, Petroserv achieved increased visibility of its projects through enhanced data accuracy. From a short-term perspective, Petroserv gained improved knowledge on project cost control and, from a long term perspective, it has been able to increase profits, improve tender accuracy and reduce risk.
Main advantages: The Candy and BuildSmart products have enabled Petroserv to identify where issues exist in real time. As such, they are now able to pinpoint opportunities for cost-efficiencies far better than when using conventional ERP software.
This data is analysed and used to improve the accuracy of project reports, allowing the business to identify where there are risks and predict profitability. The BuildSmart ICMS system in particular, makes contract cost information available in real-time, which reduces the time required to produce cost reports significantly and also requires the project teams to work more closely to verify data, thereby supporting accuracy.
“CCS products have benefitted our company and will benefit other companies in the construction industry. With the risks and costs involved with deploying ERP systems, selecting the right people to partner with is as important as the right products – CCS fulfilled both criteria. As such, we’ve been able to develop effective project cost control for construction projects that have not been possible with previous systems implemented.” Mubarik Hussain, Head of IT, Petroserv
OVERVIEW OF CCS:
CCS provide dedicated cost management software solution to the Construction and Engineering industries. All CCS products are designed by and with the help of experienced construction industry professionals which means they are built with a deep understanding of the industry and the problems that typically occur.
Candy and BuildSmart provides an integrated solution from first estimate to final accounts in real-time. Used together, BuildSmart ERP Cost Management and Accounts and Candy Estimating and Project Control tie the financial processes to the physical processes of your enterprise construction projects. This means that an accurate and real-time appraisal is presented of each construction project of your enterprise. Information used to improve inefficiencies and maximise opportunities
Launched in 1982, CCS is headquartered in Gauteng, South Africa and has further offices in the Middle East, United Kingdom, Portugal and India. CCS has more than 14 000 users in over 50 countries including many of the worlds largest construction companies.