Updated: Feb 28
"We want to grow to 50 Million!"
My client was a multi-specialty maintenance company who had a retail and commercial construction business as well. The initial engagement with my client was to evaluate the company's software and operational procedures and re-engineer them to allow for anticipated exponential growth. We knew that a software change was inevitable because they had pushed QuickBooks to its limits and were using several other unintegrated solutions to automate various processes of the business. Also, they had developed a field dispatch software application that we wanted to leverage in the evaluation of the options.
I presented the MBSM (Managing by Strategic Metrics) management strategy to the company and they agreed that in order to achieve their desired goals, they needed to embrace the MBSM strategy. Our next step was to pull the departments together and evaluate their processes backwards. We looked at the existing metrics that were generally pulled together manually and defined the automation of those reports and dashboards so that they could be reviewed daily. Below each KPI was a work-process that in most cases required multiple entry from various applications to get to the desired reports. Upon completion of our evaluation and analysis, we created a detailed plan of every process and procedure, as we wanted them to be, from cradle to grave. This was the basis for the RFP that was given to the software vendors who would eventually via for our business and be the standard operating procedures that we would adopt moving forward.
Providing the software vendors with a comprehensive RFP that was more functionally driven than feature based, proved to be a great strategy as we were able to see how the vendors features would adapt to the work-processes we defined. It also eliminated the vendors who could not meet the core functionality we were seeking usually during the initial interview. We did allow the vendors to introduce their "best practices" functionality for evaluation and comparison to what we had determined was our requirement. Our selection was a fully-integrated ERP solution that provided:
Core Accounting and Job Costing
Project Management with Field Functionality
Departmental and Consolidated Forecasting and WIP
Mobile and Portal User Interfaces
API for integration with our existing application
Electronic Content Management with Routing and Filing capabilities
Business Analysis Tools (Dashboards and Queries)
Opportunity Management (Sales)
Multi-company with consolidation
It took nearly two years to get phase 1 completed due to some extenuating circumstances (Covid), but we were able to achieve our goals for phase 1 and 1.5. Below is a snipping of the status report:
Subject: Implementation Status
Guys, I wanted to put down in writing what we discussed Friday in our meeting and give you a status of the implementation from my perspective.
First, I want to thank you all for the opportunity to implement MBSM with CMIC at Story Construction. I feel that by going to daily processing and implementing SEP (Single Entry Processing) we have been able to see some very real efficiencies in the operations of Story. Our goal to build a system that will support a 50 million dollar operation plus has been actualized. It is my opinion that the FET requirements to support the growth beyond 50 million will be about 50% less. This should cost-justify the investment made in the software and implementation within several years and improve your overall profitability by about one or two percent by putting the accurate information in the hands of your managers and decision makers on a daily basis.
Some of the most significant milestones we accomplished are:
Single-Entry (SEP), paperless credit card processing and the posting of cost
More accurate and timely posting of cost daily to work orders and jobs
Paperless accounts payable processing, approval, coding and filing
90% of all invoices received are paperless and processed electronically daily
Single-Entry daily time capture and posting
Huge efficiency by taking the time entry from the field (Tech Track) and processing it through data entry and posting without any double entry.
Project Management driven Forecasting and WIP
This was probably the most significant enhancement we made by moving forecasting to the PM's so they would be responsible for forecasting their jobs. This will make the process more streamlined and put the responsibility on the shoulders of the PM's for accurate forecasting.
Enhancements to Tech Track to fully integrate with CMIC and eliminate double entry,
Jobs are automatically created from Tech Track
CC receipts are captured, posted to WO's, then sent to AP for processing and posting daily
On-account payable transactions are capture and balanced to invoices sent through AP email capture
New enhanced functionality of Tech Track to shore up features that have been long requested
New Excel-based estimating solution that integrates with CMIC to pull cost codes and categories and push estimates to Jobs to eliminate double entry
Strategically defined work-processes to support all the new processes and procedures to achieve daily posting of cost
Field dashboards that reflect daily transaction posting for every job in progress including drilldowns to source of transaction
Integrated Job management including
Contracts for subs and owner
Change order management
Reporting and dashboards
Standardized cost codes and categories
Integrated financial reporting to auto generated reports from transaction details
I believe we have accomplished our goal of getting Phase 1 and 1.5 completed. We have a few balancing issues which are being ironed out, but for the most part all the operational functionality is implemented and working. We still need to finalize the SOP's (Standard Operating Procedures Manual).
The client should be able to start seeing the impact of this re-engineering on their bottom line very soon. Presenting cost to the PM's and managers, daily, will spot errors and make corrections before they become problem with the profitability of a job. Also, Single Entry Processing (SEP) will reduce the burden cost per transaction by over 50%. Using the API integration of CMIC, we were able to carry SEP to the field entry of the dispatch system. All said, my client will be able to realize some real cost savings as their business grows to 50 million and beyond.