Utilities and the contractor companies that support and deliver their operational activities use many different tools to help them organise and manage their work. Some organisations still use manual forms and paperwork, some have moved to use software originally designed to deliver personal productivity gains, while others recognise and utilise the advantages in software that’s built and optimised for their work.
Streetworks Software ‘SwIMS’ our Utility Works Management Software, is a unique software solution, optimised and focused as a comprehensive streetworks information management system for all utility sectors.
Cost to value reporting (CVR) is a critical business process that for many contractors and their sub-contractors has little or no focus. Critically, the CVR process can make the difference between a disastrous contract and a highly profitable one. This is of particular importance at commencement when much money can be lost if the correct disciplines & reporting structures are not imposed.
Simply put, CVR identifies the current revenues of a contract against the costs to date almost in real time. This activity provides the business with a current snapshot of the return or net cost of an individual job at completion. CVR needs to be carried out regularly for each job, enabling the business to track the on-going value of contracts and ensure that the work being done stays in control and to budget. SwIMS provides the information to the business that ensures awareness of trends & trend analysis.
Carrying out this process on paper is challenging, time and resource consumptive and an often-inaccurate process. It can be a huge administrative burden for any business. This is particularly so when the business has multiple contracts across multiple clients and has many different suppliers with associated complex cost models. The sheer time it can take to carry out CVR on paper-based tools means that many firms fail to carry out these calculations, or if they do it is done sparingly and often months down the line after issues have become obvious and potentially damaging. Whereas they may have been identifiable via the trend analysis capabilities of the SwIMS cost to value reporting module.
The identification of potential CVR issues early in the process, means it’s more likely that they’ll be resolved up-front, ensuring that the business avoids consequential cash flow problems and balance sheet difficulties.
Our SwIMS CVR reporting module speeds up and ensures the accuracy of our SwIMS clients CVR processes. Because SwIMS is a ‘live” environment it will help our SwIMS clients by giving a current snapshot of the return or net cost of a project during delivery based on the latest continually updated data in the system. The CVR activity can be carried out in near real-time for each job, enabling SwIMS clients to track the value of multiple projects and to view the profits or loss from each one at individual job level upwards as the work is in progress.
These calculations can then be used to assist SwIMS clients to create profit and loss forecasts and show chart views for accounting periods and beyond, per contract. Per gang/Per supervisor/Per depot/Per task type(black/white etc)/Per geography The use of SwIMS CVR report data is particularly important as it provides information in to the accounts system that can support the identification of the current cash position of each profit centre. This process empowers SwIMS clients to identify potential cashflow issues before they start to impact on SwIMS clients business operations.
Here at Streetworks Software our experience informs us that most utility contractor organisations tell us that it is unlikely that the original contract costing estimates will remain accurate as the contract progresses. This is because, changing material, plant and personnel costs, changing/shifting client requirements, staffing availability challenges, new legislation in the course of a long-term contract and even weather conditions can (usually negatively) impact upon the profitability of a job.
The SwIMS CVR reporting module allows our SwIMS clients to easily compare the true situation of a contract against their original expectations and forecasts, using up to the moment data. In this way, finance teams are provided with real-time visibility of the profitability of each job, or dependant on size, for the company and its cash position as a whole. Regular CVR processes provide SwIMS clients with early warnings regarding costly contracts (or challenging elements of these jobs), so that steps can be taken to put contracts back on track much earlier in the progress of a contract.
The data must be captured; via mandatory compliance if necessary and some compromise with the figures is to be expected as it is not an accounting system. If SwIMS is linked to billing via the schedule of rates it can streamline back office processes. Costs are likely to be estimated & apportionments are a necessary compromise.
SwIMS CVR reports can make the difference between a disastrous contract and a highly profitable one. By using SwIMS CVR reporting to identify issues early in a contract, it’s more likely that they’ll be resolved. Streetworks Software SwIMS clients can act to avoid both cashflow problems and balance sheet difficulties, ensuring continued managed,secure and profitable growth.