If you own at least a few buildings, you likely have a project management system in place—whether it’s based in Excel or email or elements of other tools that have been cobbled together. But relying on a system of generic tools to drive complex decisions is nowhere near as efficient as using a project management platform that is designed specifically for commercial real estate organizations.
According to a recent McKinsey report, using a single online platform for bidding, tendering and contract management saved one team they studied “more than 20 hours of staff time per week, cut down the time to generate reports by 75 percent, and sped up document transmittals by 90 percent.”
So how do you know when your organization is ready for a purpose-built project management platform? Look for these eight signs.
1. Your Projects are Going Over Budget
The same McKinsey study noted above also stated, “large [construction] projects across asset classes typically take 20 percent longer to finish than scheduled and are up to 80 percent over budget.”
That means your team needs to track the progress of each construction cost category, or line item, throughout the course of the project to prevent cost overruns. Most cost tracking systems only track against the total job cost, not each line item. Since total job cost is a rollup of all line items and those line items often have dependencies, it’s crucial to be able to monitor your cost categories individually.
A project management platform lets you track the percentage of completion at a more granular level, helping your team spot seemingly small problems early on and prevent potential bottlenecks later.
2. Your Project Managers are Spending Hours Manually Leveling Bids
From merging multiple spreadsheets to figuring out which cell has an incorrect formula, manually leveling bids with spreadsheets is cumbersome and time consuming. In that process, project managers are turned into data-entry drudges and sidelined from driving value-add activities. Additionally, teams that manually level bids are disincentivized from triple-bidding projects, a proven path to cost reduction.
Using a project management platform with intelligent bid leveling tools moves the work of data entry onto the vendors while reducing the risks inherent in managing Excel files.
3. You Struggle to get Real-Time Insight Into Activity Across the Portfolio
If you need to wait for weekly meetings or track down a project manager in order to get status updates, you’re losing valuable time. To uncover meaningful intelligence on projects, especially at the portfolio level, lots of data points need to be compiled and aggregated. Spreadsheets strip data of its power by isolating it into digital silos; rushed emails requesting data from project teams lead to rushed responses in return.
In order to quickly generate reports or access specific information, you need a project management platform as the central repository for your data. A project management platform that acts as your system of record will help you make better decisions, faster.
4. You Lose Data and Institutional Knowledge Whenever Someone Leaves the Company
If a project manager leaves, the vendor contact information, pricing data, and project history he or she accrued is probably spread out over various emails and Excel files on a shared or local drive, inaccessible until someone can reset a password and indistinguishable from previous versions.
With a centralized platform for communication and information sharing, knowledge that is critical to the company’s smooth operation will be preserved. If you’re relying on a system of Excel spreadsheets as your project management system, even one person leaving your organization means big chunks of company data, intellectual knowledge and proprietary intelligence can be lost – and the time it takes to recover those assets are not insignificant.
5. There is a Lack of Transparency Between You and Your Capital Partner
Owners and capital partners have a shared interest in the status of expenditures across a portfolio, and project management teams often spend a significant amount of time preparing reports and metrics for your investor, JV partner, lender or other capital partner.
The World Economic Forum’s Inspiring Future Cities agenda names transparency enabled through open data as a requirement to building trust and legitimacy among stakeholders. A centralized, digitized project management system solves for this need and allows for improved decision making from a financial perspective.
6. Your Relationship with Your Accounting Team is Strained
All project data, including real-time status of invoice approvals and payments, should be transmitted digitally between your project management platform and your accounting or payment automation systems. If your project managers are still walking invoices over to someone’s desk or forwarding emails to email@example.com, it’s a recipe for frustration between teams.
By using a project management platform that integrates with your accounting tools, contract and cost data is entered once and synced across systems. It eliminates duplicative data entry and provides a new level of transparency and seamless workflow between departments.
7. You’re Not Maximizing Your Purchasing Power
Developers and building owners should be evaluating their historical costs over multiple projects or buildings to identify metrics such as cost trends, vendor volume and pricing, or market anomalies which can assist in procuring products and services at lower costs. This type of analysis requires minimal time once systems and procedures are established.
8. You Struggle to Effectively Access and Use Data From Past Projects
Accurate forecasting requires data from a variety of sources and across financial periods. At some point, this information needs to be gathered from the various sources where it lives and aggregated in a way that is easy to evaluate. How many hours or days do you usually spend on this?
A technology platform makes this process automatic and seamless, saving a significant chunk of time for your project team. Quickly access key performance indicators on past projects and make more informed projections.
If you are seeing any of these signs—from a lack of transparency across your portfolio to lost time focused on low-value activities—your organization is probably ready to move to a platform purpose-built for commercial real estate project management.