William Sankey, CEO of Northspyre.
Managing an intricate development project can feel like a balancing act, especially when teams find themselves bogged down by non-strategic, albeit extremely important, accounting and reporting work.
Archaic budgeting processes typical of traditional real estate development can prevent projects from moving forward in a timely manner. One small mistake in reporting can result in hours or days spent reconciling budgets or create cascading negative effects on accurate project decision-making.
Those of us who have developed commercial projects in the past are all too familiar with the laborious tasks of managing vendor change orders and submitting draw requests to financial institutions. While time-consuming, these processes are crucial to a project’s success. In order to know where the budget truly stands, development teams need proper, up-to-date reporting and accounting processes to manage these items effectively. Failure to do so can prevent project funds from being released, leading to potential delays.
Whether you work for a large firm with a big team and seemingly unlimited resources or a smaller shop, human error and cost overruns remain a universal challenge. I’ve noticed that more nimble teams can strategically adjust workflows easier to accommodate the adoption of new technology to streamline their accounting processes. This is a heavier lift for larger firms, as they tend to have dedicated administrative and accounting teams separate from project managers who oversee budgets. These two teams often work in silos and don’t use one technology platform as a single source of truth.
For developers seeking to implement modern technology to improve budget management and accounting efficiency across teams, below are a few tips I’ve learned (as the CEO of a company that produces such a platform) that can make the transition more seamless.
1. Become Acting Ambassadors Of Tech
Project leaders cannot take a passive role in implementing technology. In fact, senior management should be champions for technology that will help their teams navigate complicated vendor contracts, invoices, change orders and draw requests.
I have found that project managers who roll up their sleeves to do the work of introducing automation into everyday operations are able to create the proper pathways for a seamless, efficient transition to tech-enabled workflows—saving their teams precious time and labor in the process.
2. Tear Down Barriers Between Departments
The most important piece of advice I can give to leaders in development attempting to eliminate silos and improve workflows between teams is to take time to fully understand the inner workings and dynamics of your teams—especially when you are a member of a bigger shop. Breaking down the walls between siloed workflows is a crucial step in the process of implementing technology because it opens the door to increased interdepartmental collaboration.
Project teams that have real-time visibility into accounting data no longer have to rely on gut instinct when making decisions and can get ahead of problems and conserve on costs based on actionable budgetary insights. By reconciling administrative and strategic functionalities, sophisticated firms are able to work more efficiently and with greater transparency both internally and with financial partners.
3. Use Compatible Systems
Most large development organizations already utilize a sophisticated accounting system. When accounting teams have already gone through the training and received certifications for certain systems, they are more resistant to implementing unfamiliar software.
For this reason, senior leadership must do their research and due diligence to invest in software for project managers that interface with existing solutions to further streamline and automate financial reporting. The goal is to enable your project teams to achieve greater efficiencies without the burden of learning an entirely new process.
It can be easy to get stuck in outdated workflows, but as the industry continues its shift toward automation, it is more important than ever for project teams to seize the opportunity to streamline accounting work. Development teams positioning themselves for budgetary success by increasing collaboration and transparency between departments increase their ability to make the most informed, strategic project decisions.