Mike Antis, global vice president Textura, Oracle Construction and Engineering, explores how firms can use new tech to simplify and standardise critical construction payment processes
As the digitisation of the construction industry accelerates and evolves, general contractors have made great strides in innovation at the job site. Technologies like the Internet of Things, reality capture, and autonomous vehicles are bringing new advantages. At the same time, many have overlooked the substantial productivity gains they could be making by giving the same attention to back-office processes. To save time and money across all facets of their business, organisations need to think holistically about their digital transformation, including one area often still mired in manual, disconnected processes: payments.
How much easier would your project administration be if you could replace the traditional payment process with one that simplifies and standardizes critical processes? One that boosts efficiency and control―for all stakeholders―across invoicing, payment, and compliance management? One that ultimately could reduce your risk as a general contractor, owner, or subcontractor, while also freeing up teams’ time to focus on activities that are more beneficial to your business.
Collaborative payment management
A collaborative payment management solution not only helps manage the payment and billing processes across project participants; it also can forge better, more lasting partnerships in the industry by providing assurance everyone is paid fairly and on time. Such technology can streamline the payment process for construction companies of all sizes by managing payment due dates and related actions, as well as improving accuracy. It also eliminates inefficiencies and a slew of risks, including human error, improper payments, and liens that prevent the clean handover of a project to the owner.
Investing in payment management solutions is an effective way for construction firms to maintain strong relationships with subcontractors. This is because they can quickly pay subcontractors who have immediate cash flow needs. This creates a partnership of convenience and trust – making it far more likely that subcontractors will accommodate their needs when necessary.
However, firms mustn’t take a half-measure approach to automated payments. It’s no use if some jobs remain on an older manual system, while others are on the new system. This can easily cause confusion and stall collaboration and progress. To truly maximise efficiencies, there needs to be an attitude to ‘go-all-in’ with implementation.
Automated construction payment solutions
In addition to strengthening relationships and ironing out inefficiencies, automated payment solutions can also help companies eliminate manual steps and miscalculations. This can be done by automatically generating accurate invoice documents linked to schedules of value, for example. Plus, they can help firms centralise the tracking of compliance and lien waiver management, in addition to other important documents and reports. This helps to streamline these crucial tasks and prevents further safeguards against risk to all stakeholders.
Automated payment solutions also enable team members to collaborate within one shared environment. With all parties using the same collaboration platform, owners, general contractors, and subcontractors all need visibility into compliance and payment status. As a result, they can anticipate and collaboratively address potential issues before they grow into pressing problems.
The automation and simplification that results from using a modern payment processing solution help to increase productivity and reduce errors. Additionally, firms can implement a standardized cloud-based system for financial processes across their ERP and accounting system, which can provide support reports, dashboards, and analytics. This enables firms to capture and analyse payment data across their business, providing a more strategic current state of affairs, and helping answer questions delivered to them when and how they want them.
Improved cash flow
In all, these modern approaches to payment solutions can help mitigate financial, legal, or reputational risk, while improving cash flow. Ultimately, this improved cash flow also allows for organisations to more predictably meet payroll, hire, and invest in their business.
As construction sites continue to incorporate cutting-edge technology to help teams complete projects in a safer, more streamlined way than ever possible before, it simply makes sense to further modernise the payments process as well. It can provide all stakeholders with peace of mind by helping put an end to those pesky paper-driven office tasks that are already being eliminated with cutting-edge technology on the job site.
