Forecasting is a vital part of planning for any construction company’s long-term growth, especially in an industry as unpredictable as construction. Having a clear understanding of costs and cashflow as well as work package needs can help stakeholders make informed decisions that will mitigate risks and drive the business forward.
Forecasting and budgeting software is an easy way to ensure that you’re up to date with the latest costs and profitability data in real-time, and it will equip you with valuable information and insights that can be used to predict future expenditures. Without a complete and clear financial overview and plan forward, companies will struggle to grow and gain the competitive edge.
Why you need construction forecasting software
Asset owners can often find projects running significantly over budget, which effects customer satisfaction and may throw of schedules for future projects. Construction forecasting software can have a significant impact on the success of a project in this regard, helping project planners craft more accurate budgets by predicting work package costs, and taking into account any potential risks that are likely to pop up. It combines project cost estimation, cost capture and cost management with risk management and forecasting.
With this type of cloud-based solution, project controllers have a clear view of how much time and money is being spent throughout the phases of a construction project.
This lets them know how much budget is left for each particular project phase, allows for room to make adjustments before it’s too late, and provides valuable data and learnings that can be applied to future projects. Using construction forecasting software provides reliable data, on which basis decisions can be made.
In addition to helping save money and stay on track budget-wise, forecasting software also standardises tedious processes such as the invoice approval or change request approval processes, saving project managers, on average, three to five days each month and ensures accounting compliance.
Avoid repeating costly mistakes
Construction forecasting software helps project planners avoid costly mistakes by reducing the level of manual administration and calculations done via static spreadsheets. It’s easy for errors to occur when multiple people are using and entering data into spreadsheets, and mistakes tend to go unnoticed for a long time. Using a software that provides a single, centralised forecasting and budgeting overview and can detect potential costly errors early on can result in significant savings.
Access to a real-time, single source of truth of budget versus costs prevents deviations and discrepancies and ensures complete cost transparency for all relevant stakeholders, no matter how big the project may be.
Having all costs managed centrally also provides absolute transparency. As a cloud-based solution it allows managed and controlled access to all relevant information 24-hours a day, any day. This level of transparency helps ensure that things don’t fall through the cracks.
It also enhances collaboration throughout the team, making it possible to spot errors soon and the added transparency allows for contingency management. If something isn’t going as planned, the data from construction forecasting software can be used to make informed adjustments and then the learnings can be applied to future projects in order to avoid the same situation. The insights from the data gathered on a project can also be beneficial when it comes to forecasting and budgeting for future projects.
Using construction forecasting software to manage budgets
External and internal budgets are an important part of any construction organization, no matter its size. Even with small projects, it’s easy to lose track of all the different budgets associated with it if you don’t have a clear overview of the entire construction project budget. Construction forecasting software bridges the gap between project controlling and project management. The integration of accounting systems such as SAP with some software, provides a seamless transfer of data.
This is an invaluable tool for project planners when it comes to predicting costs and planning budgets. With cost capture and cost management capabilities, it’s possible to assess the current state of the budget during any phase of the project and get notified about any budget overruns early on in the process. These figures provide a clear and consistent way of identifying trends and gaining a transparent overview of projects for everyone, from asset owners to project managers.
The real-time analysis provided by construction forecasting software also allows cost information to be seamlessly transferred throughout various processes and project stages. This data can be used to make budget adjustments throughout the project if necessary. Project managers and controllers can manage cash flow planning and billing runs, create cost forecasts, and access critical evaluations immediately to avoid delays, save money, and improve customer satisfaction in the long run.
Check out Thinkproject’s construction budget and forecasting solutions to find out more about how they can help save you money and avoid repeating costly mistakes in your construction projects.