To streamline your construction business, you’ve decided to implement construction software with your accounting software. Congrats! It definitely makes sense to automate as much as possible and utilizing two softwares is hands down more efficient than only one. The functionality that you get using construction specific software, in addition to your accounting software, like QuickBooks, will only make you more efficient but it is important to have a plan before you consider yourself fully integrated.
What it means to be integrated
There are a lot of misconceptions on what it means to be truly integrated with your softwares. Many owners believe that they are integrated because they have simply linked the two softwares together. Linking the softwares simply means that you have approved the connection between the two. This does not actually create a clear path to move the information from one software to the other. However, it is important to link the two together to initiate the relationship. Understanding where the information goes and how it travels is a crucial piece for a successful software integration.
Why integrate
The main reason to consider using third-party construction software, integrated with your accounting software is simple. Double data entry! When integrated, you will avoid entering financial information in your construction software that is required for your budgets, and then having to enter the same information again into your accounting software so it hits your cash or credit accounts. You need the information in both places and only having to enter it once saves time and risk of error. When you are integrated, you will only have to enter information once and it should move to the other software. This saves you time, decreases the risk of errors and gives you more information to run your construction business.
Benefits of integrating construction software
You’re able to better manage your budgets.
When information flows automatically from one software to the other, you have the opportunity to get real-time information and can find out if you’re over/under on a line item throughout a project. You can then make adjustments and move allowances, giving you the ability to maintain your profitability throughout the project.
Your software can do the majority of the work for you.
Construction software integrated with accounting software gives you much more functionality than accounting software alone. You will only have to enter a transaction once and the software will feed the fields you have mapped together, saving you time and extra work. When they are integrated properly, it will feel like you are working with one solution because your process is streamlined. Also, having information in one spot will make managing your projects easier, versus having to hunt for what you need.
Control over your accounting file.
Control over your accounting file is another benefit to having two softwares that are integrated. Having too many hands in the pot raises the risk of errors in your accounting. With two separate softwares, you can limit who has access to the accounting file but your team is still able to get the financial information they need out of the construction software for budgets.
Avoid human error.
Anytime manual entry is involved, there is the chance of error. When you have to manually enter information into multiple places, that is just more places for error. Integrated software eliminates some of the entry points which can increase your odds of accuracy. Also, it can be difficult to reconcile manual entries and know that they’re right. If entries don’t match, there is even more work to determine which entry to trust and go with.
Alright, now it’s time to get into the details… Here are 4 key things you must do to get your software truly integrated.
1. Before you implement, think about your process
Going from one software to two is something you need a plan for, meaning think about how things will flow once fully implemented. Taking the time to think about how implementing software changes your current workflow before you initiate the implementation is so important. Once you add the software, you change the way information is gathered, is processed and potentially who is involved. So planning for who and how will only help in the long run. Let’s look at a common process of getting invoices approved to pay to see how the process could change.
Who
Your “before” process could include someone from the bookkeeping team, project management team, and you as an owner. After implementation, it could only require someone from project management to handle the items. Before you implement any software, consider it a great opportunity and take a look at who is doing what and how tasks can be more streamlined. Set a plan on who will do what now that you have integrated software.
How
The process of getting invoices approved to pay may have been very manual, but with construction software it can potentially be done directly in the software by the same project managers. Once approved, you can utilize the construction software in a way that notifies your accounting software to pay. This really streamlines the process. Thinking about how things will actually get done ahead of time, and getting people involved on the same page can only help you.
Set up
You may also need to make a few changes to your current setup. For example, the NAHB codes you’re using may need to be tweaked so that they work well with both softwares. It is important to consider the foundational pieces of your setup that might need to adjust as well.
Software communication
Another important thing to know is how the softwares communicate with each other. Does the construction software pull information from your accounting software? Or does it push information to your accounting software? It is important so you know what is being communicated and where the entering needs to be initiated.
2. Link your software
The first step to integrating is to link the two softwares. As mentioned earlier, this is really just making the connection between your accounting and construction software. Linking is what allows them to talk to each other. Many times this is where people stop and then they wonder why the information isn’t moving over correctly. So don’t stop here.
3. Now it’s time to map your software
Now that the two softwares can communicate, you need to create the bridge so the information can get where you need it to go. This is the most important step to get right, as it can affect the success of your integration and ultimately your financial reporting. When you are mapping the softwares, you are identifying what a field in one software should link to in the other software. One example is mapping “Bill” in your accounting software to “Invoices” in your construction software so the value is the same in both when entered in one. It is also important to note that many times softwares use different terminology, as shown in the example above, so it is important to understand the terms used in both and how they relate.
A few examples of what you will need to map are:
- Cost codes
- Subcontractors
- Vendors
- Customers
- Chart of Accounts
4. Test and verify
Now that you’ve linked and mapped the softwares together, it is important to verify the information is correct. Do some tests so you can see where the information is going and if it is giving you the information you need to run your construction business. Take one transaction, enter it how you expect your process to work, and check to see that it goes to the other software and in the field you are expecting. It is so important to get the mapping and setup correct before you go full force in the software. This again is where having a plan before you implement can be extremely beneficial.
If you don’t test, it can raise questions on accuracy and create a lot of work trying to determine what’s right. And then, there is “fixing” a potential issue you found. Once software is mapped, it isn’t always easy to fix an issue and can cost time, money and resources to get sorted out. This can be frustrating, especially when you integrated to make your life easier. Have a plan, take it one transaction at a time, and make sure you understand how everything works together.
As you can see, implementing software can be a little more complicated than many believe. An option is to find an expert to help you through the process, so you can trust that your new process will work for you and that you get accurate reporting. Once you have the setup right, your life will be easier!
If you need help with your software implementation and integration, give 24hr Bookkeeper a call. We have experience in both construction software and accounting software and know what a good process looks like. We can help you get there! Reach out or set up a meeting today!
