Close the Procurement Gap

4castplus Brings New Meaning to One-Touch Data with a Fully Integrated Project Procurement System

There’s a gap that often exists between Project and Procurement when running major construction projects. This gap can cause data errors and and timing breakdowns that can lead to project delays, cost overruns and significant inefficiencies. With the 4castplus integrated procurement system, this gap is now slammed shut. Finally the whole project team can function in a collaborative environment where data and workflows are shared, and inefficiencies are eliminated. 

Procurement’s Critical Role

The procurement team plays a critical role on any project. It’s vital that they remain in constant sync with the rest of the project team for a smooth and successful result. All too commonly, however, procurement operates in relative isolation.

The relationship between project and procurement is typically handled with numerous paper documents like a Materials Requisition Document (MRD) or Purchase Requisition Document (PRD) and many different spreadsheets – Bid Analysis, Procurement Tracking, etc. The project manager or estimator creates the requisition document out of the list of items needed for the project (often by copying them into a spreadsheet template), and walking it over or emailing it to the purchasing representative for his project.  At this point, the purchaser will begin RFQ and bid analysis; and ultimately, purchase orders will get generated and shared with the project manager.  Any changes to unit price or quantities will be communicated somehow back to the estimator (through a spreadsheet, email or other documentation) so that he can update his estimate.

Unfortunately, with this type of disconnected structure, data and communication can easily get lost and errors are often introduced.  Not only that, but the effort of copying data around is time consuming and inefficient.  

What We did About it at 4castplus

So after hearing the many cries of frustration felt by many folks in the construction project industry, we at 4castplus decided we’d do something to resolve that riddle so that they could all live under the same roof. Introducing 4castplus Integrated Procurement System – a closed-loop project-procurement solution with One-Touch Data simplicity and control.

When using this system in 4castplus, a user can create an electronic Purchase Requisition using the exact materials, equipment and contracted services that are specified on an estimate. Using the close workflow between Projects and Procurement, that same Purchase Requisition is then shared with and used by procurement to create both RFQs and Purchase Orders.  In doing this, the data used on the estimate is the same exact data that ends up on a purchase order. There’s nothing that gets copied or even printed and everyone’s looking at the same pieces of information. All this information is digitally signed and electronic, so the control & auditability of this information is always clear and transparent. Additionally, it’s this same information that gets tracked as materials and services are received or completed on the project. Again, no disconnect, all the same data.

Also, when an RFI comes in and a change order is created, the purchasing requirements for this change order (via the CO estimate) can flow through to procurement in the same way; and either new POs can be created, or existing committed POs can be modified under the audit of the change order. Either way, all change orders and related purchase orders are transparent and auditable.

Here’s an Example

Well, that was all a bit of a mouthful, so let me give you a simple example to illustrate just how smooth and controlled this system is.  Let’s say a project estimator specifies that he needs 1,200 cubic yards of gravel for building an access road at a cost rate of $39/CuYd. He also wants to hire a subcontractor to apply and grade that gravel and, based on past experience, he’s estimating that this work can be done for $73,000.

Within 4castplus, users can enter details like that directly into the 4castplus Estimating system, or they can import it into the estimate from take-off software or even from a spreadsheet. Whichever way they get it in, that will be the first and only data touch-point – and from then on, it will never have to be copied or re-entered again.

Figure 1 - Purchase Requisition Worksheet (click to view)

Now that these two items are on the estimate for that work-package (task), the estimator can now drag & drop those items to a Purchase Requisition (see figure 1), which will send an email notification to the lead purchaser that a new Purchase Requisition is waiting to be completed. The purchaser can then open this Purchase Requisition by simply clicking on it in the Procurement area of 4castplus (see figure 2). Notice there’s no paper changing hands, and no copying, and there’s no data or timing disconnect.

Figure 2 - Detail Purchase Requisition for Procurement (click to view)

The purchaser can do the following with the detail items on this Purchase Requisition:

1. Create RFQs
2. Modify unit price and quantity; then update the estimate to reflect these changes
3. Allocate all or part of each item to one or more Purchase Orders

As the individual items on a Purchase Requisition get allocated to purchase orders, the status of the Purchase Requisition will update so that the project manager and estimator are constantly kept in the loop as to the progress being made on their purchase requests.

Within the procurement system, users can also do the following:

1. Create, Commit and Print purchase orders
2. Digitally sign and attach documents
3. Track progress on PO commitments as incurred costs
4. Make adjustments to committed purchase orders based on Change Order estimate items
5. Track and report on any approved overages on items received
6. Apply an approval process around vendor completions for validation and quality control
7. Engage an Expediting process
8. Launch a variety of real-time reports and metrics in a single click
9. Produce procurement cash-flow reports
10. Share, collaborate and pass messages between internal and external stakeholders

Within any of these activities, the project and procurement team are constantly kept in sync with each other as to costs & status; and numerous reports are available to view and print.

Close The Gap

The disconnect that emerges when the same information isn’t being used by all the players in a major project, can have significant influence on the success of that project. Ensuring that information flows seamlessly, not only creates a highly-collaborative environment, but it also drastically reduces inefficiencies, delays and errors caused by copying data around.  With the One-Touch data capabilities found in 4castplus, organizations can finally achieve that highly productive environment they’ve been looking for.

We’d Love to Hear From You

For more information and to sign up for a free demo, please contact us on the following:

Free Demo: http://www.4castplus.com/freedemo

Contact: http://www.4castplus.com/contact/

Or, email us on: info@4castplus.com

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