Effective project cost control processes can be an important differentiator in the success of solar EPC businesses. Considering how competitive the solar EPC industry has become, even minor improvements in financial management and project cost control will give you a big competitive advantage.
Simplifying your solar project cost control processes makes it more likely that your team will follow them. Let’s look at how exactly you can do that.
In the case of a solar installation project, there are different kinds of costs involved – material costs, labor expenses and other miscellaneous expenses.
Depending on the size, complexity of the project, and IT infrastructure of the solar EPC contractor, material costs are tracked either in spreadsheets or in ERP software.
Labor and other expenses are often tracked in ad hoc spreadsheets or don’t get tracked at all. Sometimes site engineers just maintain their own record of expenses in absence of a central expense management system.
Because project costs can come from many different sources, the first challenge is to combine the data from all these sources.
Project related costs also come from different stakeholders –
All these stakeholders must connect on a central platform with their inputs, so that we can get a consolidated view of all the project expenses.
Most people working in a solar project team are completely used to managing their work with spreadsheets. They prefer to use Excel sheets or Google spreadsheets to manage project SOW, BOQ, expense sheets, and other important info.
But the problem with these spreadsheets is that they are disconnected. They don’t allow the processes, the stakeholders, and the related cost data to be easily centralized.
Getting a solar project team to move away from spreadsheets may be the biggest challenge in implementing project cost control processes.
Fuzen’s solar project management solution enables the project manager to track the project execution milestones, progress, actual costs, and payments from a central project dashboard.
The project cost control part of this solution tracks actual material costs, labor, and miscellaneous expenses against the project budget. Finally, you can compare the actual Vs budgeted costs to continuously monitor the profitability of any project.
Ultimately you can only manage and improve something that you can measure. Fuzen gives you the necessary window to monitor the financial health of your solar projects.
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Fuzen lets you create your project BOQ and budget directly in a Google sheet. So that you don’t have to worry about dragging your team away from spreadsheets.
For tracking the actual material costs against this budget, you can either create Purchase Orders (POs) directly in Fuzen or you can input the actual numbers in a simple HTML form on the Fuzen dashboard.
Your purchase manager will also have the option to directly update the cost numbers in the spreadsheet, just in case he loves them too much.
Similar to material costs, other expenses such as labor, net metering, transportation, commissions, etc. can also be tracked with the help of simple customizable HTML forms on the Fuzen dashboard.
Even in this case you can opt to directly jump to the BOQ sheet and update the numbers there. Fuzen gives you the freedom to work with the tools that you are comfortable with.
Effective project cost control is possible only when all the stakeholders give their expenses and cost inputs on time.
But often people tend to forget. That’s why Fuzen sends them a ‘Todo List’ email on a daily basis, reminding them what inputs are pending at their end. They can just click the links in the email to open a mobile-friendly form and update their inputs.
Fuzen also sends reminder messages on the user’s WhatsApp number to ensure they submit their inputs on time.
All of the submitted expenses and costs numbers are then consolidated into a project cost control report.
The inputs from different people can come in different formats, following different units, etc. Reconciliation is important in order to arrive at a budgeted Vs actual cost report.
Fuzen uses automated workflows for reconciliation.
When you install the project management app, it will be configured with our default workflows for project cost control.
But you can easily customize. Fuzen is 100% flexible and our support team can help you to mold it the way you want.
Or you can check out this documentation if you want to explore the customization by yourself.
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