How ERP improves project management
Project management is important in most businesses. The same businesses usually have an ERP system as well. Maybe less often do we consider that ERP is a tool that can greatly improve project management. In very simple terms, project management means we have an objective and we control the variables along the way from some originating point until our goal is achieved. ERP is our friend along that path.
Track project costs
One can assign a production job number to a project. Using this simple ERP tool, costs of all kinds can be assigned to that job number. Labor hours and costs are recorded as charged to the project. Purchase orders, outside subcontractor costs, and the cost of materials from inventory accumulate in much the same way inventory costs accumulate until they are expensed as cost of sales.
Many ERP systems have more sophisticated tools but all ERP can use tools such as job costs by adapting the tools we have creatively. ERP is a very flexible set of tools at our disposal.
Common source of data
Well-run businesses recognize that they must all speak the same language to communicate effectively. State project benefits in terms related to ERP. Connect project team members to the project using codes or other parameters contained within ERP. Establish any project budget within ERP and use the accounting system to produce budget vs. actual reports on the project.
The BI toolset within ERP provides ways to report on projects. Set up project milestones within ERP. These milestones are interim goals to be achieved by certain dates. Extract costs and benefits from ERP based on project identification codes. Use sorting and filters to group the costs and benefits within the milestones. Now produce detailed analyses of the project or produce a simple dashboard in real time making a summary of the project status immediately visible for management review.
Engineer to order
A business that produces tangible goods or services unique to each order will use project management tools extensively. Many subcontractors and other outside resources will be involved in the ETO project. ERP supplier management tools will help coordinate these resources helping ensure all the work leads to the desired outcome and the customer is satisfied. Whether yours is a single project or a more complex multi-project program, ERP will help.
Focus on people
A typical use of ERP is to record transactions and generate information based on sales of tangible goods. When we switch to a project management perspective, we look to ERP to assume a more people-based view. People are the agents of sales and transactions at the heart of any project. ERP can provide real-time information related to the project. ERP will help allocate resources to best serve a project. ERP can aid with any required corrective actions throughout the life of the project.
Most businesses require project management whether occasionally or every day. ERP contains tools and resources that will help you manage those projects at your businesses. Use the ERP you already have to manage your projects.
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