Frequently Asked Questions

The sole purpose of any business is to create wealth for its owner/shareholders. In construction, business wealth is created based on the number of successful projects and the percentage of profit made from the project. Errors and inefficiencies in the business leads to decline in profits. Good construction management software should eliminate the errors and inefficiencies and lead to higher profit. Business owners must analyze the savings and make decisions based on how much more profit they will get by using the software. This will also determine the cost one is willing to pay for the software.

Efficiencies comes in many forms:

• Time – If using software will save 15% of the time for an eight-employee company, that translates to 1.2 employees. At an average annual salary of $50,000 that translates to $60,000 per annum.
• Error Elimination – Errors occur with data recording or data modification on spreadsheets or paper-based management. There are no checks and balances to catch these errors. Charging more for a product will most likely be caught by the client but charging less or forgetting to charge will not be reported. For most businesses these errors go undetected and when they are detected they are left unreported by employees because of negative consequences. Eliminating or reducing these errors will lead to higher margins.
• Communication – Lack of clear communication and the lack of ability to track the communication, leads to inefficiencies and lower satisfaction in clients. For example, ordering the wrong colored item over the phone or via email or verbal communication with a client that leads to unrealistic expectations that cannot be tracked. Software that provides a mechanism for clear communication that can be tracked eliminates the order errors and leads higher client satisfaction, higher retention rate and higher profit.

Regardless of organizational size or industry, project management software is beneficial to all companies that manage construction projects.

Adopting construction project management software can benefit any company that requires an efficient method of estimating, planning, tracking, delivering, and billing for their services. It enables you to design, implement, and manage effective and efficient processes for your team and business. Remember, efficiency is directly proportional to profitability.

When deadlines are missed, processes are broken, and miscommunication occurs, it makes sense to invest in construction project management software.

For best results, one should invest in software before it becomes critical. While it can be difficult to predict when you will outgrow more basic tools, such as spreadsheets, here are three indicators that it is time to invest in better solution.

• Miscommunication – A misunderstanding with a client based on verbal or email communication that cannot be tracked. For example, spending hours searching for emails to track past communication. The amount of time wasted on this is difficult to track but easy to fix with proper software.
• Missing Deadlines – Nothing impacts clients more negatively than missing deadlines. A good scheduling tool will keep all parties informed and organized so that delays are mitigated, and deadlines are met.
• Indispensable Employees – If your business is dependent on certain employees and it will suffer heavily in the event they leave, you must invest in construction management software. You are relying on your employees to use their processes and expertise. Good software will make processes transparent and easy to teach to new employees. For example, an amazing estimator that has developed a spreadsheet with embedded formulas that only he/she understands can be replaced easily if all the work is done in software. Remember, a good software vendor is always there to provide support and onboard new employees.

The cost of Construction Project Management Software, also known as Project Management Software for construction, varies. There are several factors to consider while assessing the cost of Construction Management Software for your business:

1. Requirements – Make a list of your current and immediate future requirements. Most users are unaware of what is offered by various packages on the market. As a user, one should look for a software that meets all your requirements today and will be good for you 3-5 years down the road. Note that most people buy the cheapest software available to them based on their limited knowledge of their own requirements. This is the most expensive mistake buyers make as it leads to a loss of time and productivity due nonfunctional software and in many cases going back to the old methods such as spreadsheets.
2. Payment Terms – There are dozens of payment mechanisms and plans adopted by the various vendors:
   1. Installed Software offers one time purchase with maintenance plans. This was the only mechanism at one time, but it is extinct now. Only few enterprises and specialty software offer this option. This is now limited to software purchased by very large corporations.
   2. Per User Per Month is the most common method, also known as Software As A Service (SaaS). The buyer pays per user per month and are allowed to add or delete the number of users anytime (some restrictions may apply). Software upgrades and support is included in the monthly cost. Most Cloud based software offer this mechanism.
   3. Concurrent Users is where the vendor allows the buyer to setup an account for all the users but only allows a few users to use the software at one time. This was the mechanism used in the days when computing power and speed of the software was an issue, but some vendors are still practicing it. This is a kind trap, as the buyer ends up getting a license for only a few concurrent users, only to realize they need more concurrent users once they start using the software and end up paying hefty amount for additional users.
   4. Number of Projects – Some vendors charge based on the number of distinct projects executed on software per month/year. This may work well for custom home builder with the capacity to build say 30 homes per year, but it will not work for production builder where a single subdivision can easily go over 100 projects. Similarly, renovation companies can execute hundreds of small projects in a year.
   5. Other Mechanisms – There are other similar mechanisms used by the software vendors. The buyer must access these offerings based on their current and future requirements.
   6. Best Option for most companies is when they know the exact amount they will pay for number of users regardless the number of projects. All paid users should have the option to use the software anytime. The sole purpose of the Construction Management Software is to enhance productivity and that will only happen if most people in an organization are collaborating using the software. Innovative companies offer price structure where a higher number of users leads to lower cost per user.
3.  Cost – There are several construction software that cost a few hundred dollars all the way to hundreds of thousands per month. Make sure the software you choose offers all the functionality in the quoted price based on your need today and in the near future. Almost all the construction management software charge monthly fee (see above) along with a onetime setup and onboarding fee.
   1. Entry Level Software – The cost is a few hundred dollars per month for limited functionality plus a one-time setup fee that will range in two to five thousand dollars. The setup and onboarding will normally take two to three days of training.
   2. Advanced Professional Software – The cost is a few hundred dollars per month for a very limited functionality to thousands of dollars per month as a user adds more functionality. A one-time setup fee will range in tens of thousands of dollars. The setup and onboarding will take two to six months depending upon the size and complexity of your business.
   3. Software for growth companies – There are few software companies that offer a complete end-to-end software at the cost of entry-level software and provide functionality closer to the professional software. It will normally take couple of working days to setup and train the users.