Managing Project-Based Businesses with NetSuite ERP: A Deep Dive into Project Accounting

Whether it’s a consulting firm, a construction business, or even an engineering team, if you own a project-based business, chances are you face a whole host of challenges. Resource juggling, budget balances, and incoherent timeless that need to be met nonetheless. NetSuite is a lifeline for the overwhelmed. It provides some light at the end of the tunnel with its adaptable and comprehensive solutions that streamline all of these issues, allowing you to keep close track of costs, revenues, and profitability. Today, we’ll run through how NetSuite project accounting tools allow project-based businesses to manage project finances effectively and optimize resources. 

Why NetSuite for Project Management

When you  hear “project management,” you’re probably think Asana, Monday, or TeamWork. However, project-based businesses that wish to scale rely more on ERP solutions instead of these tools. Why? Because of the seamless integration offered for financial data, timelines, and resource management. NetSuite ERP for project management specifically focuses on these functions and also provides industry-specific tools meant to help businesses, including project-based. According to data from Oracle, businesses using ERP systems reported a 95% improvement in process efficiency due to integrated project management features. Why wouldn’t you want to be a part of that 95%? 

So yes, there are benefits of implementing some sort of ERP system, but with NetSuite, it’s particularly advantageous because NetSuite project accounting focuses on specific needs for even the most complex multi-phases projects. 

Project Financial In Real-Time

Where NetSuite really shines is project accounting — the offer of real-time project costs, revenue, and budgets. This means you no longer have to wait around for the end-of-month reports to come in to double check your financial health. Any form of visibility like this is important to project managers (and others) who need to know up-to-date information in order to make the next move. NetSuite’s project dashboard allows these managers to compress data and track every dollar spent on a project. Another added benefit is that you can take that real-time data and compare it to your projected costs in real-time. Aberdeen Group even reports that 85% of project-based companies using ERP systems saw improved cost control, which if we’re being honest would most likely be attributed to enhanced visibility and accurate reporting. 

Not only can you just view these finances, you can set budgets, forecast expenses, and manage the entire project lifecycle besides financials in one solution. No more back n forth, no more pen and paper – now you’ll have an integrated approach saving you time and reducing errors. 

Resource Allocation and Management

Resource allocation can break your project’s bottom line. You can’t spread yourself too thin and you can’t try to nail down resources to one area that doesn’t need resources. What we’re getting at is that within a project-based business, resource allocation is one of the most important aspects of the businesses success and overall profitability. A project’s bottom line can become short due to mismanagement of resources. Using NetSuite, you’ll be able to manage all of your resources and allocate to help assign the right people to the right tasks at the right time. 

As we mentioned above, real-time data is key. NetSuite also enables real-time tracking of labor costs and material costs. Using any of the historical data you have on hand, businesses can allocate resources more effectively. 

Automate Your Billing and Recognize Revenue

Billing becomes complex for any business. However, with project-based businesses more specifically, it becomes even more of a headache due to the different billing methods used for different projects. One project might be a fixed-fee, but your next might be a milestone-based payment system. NetSuite ERP simplifies this process through automated billing and revenue recognition, making it a life saver for you to track earnings and ensure timely invoicing. 

This automation helps prevent revenue leakage—a common issue in complex projects.

Also, when it comes to compliance with the government or any other regulatory standard like ASC 606 (which governs revenue recognition in project-based contract), NetSuite project accounting comes in to save the day yet again. The system will automate revenue recognition schedules based on milestone within your project or other criteria you specify. 

Takeaways

Managing any type of project is no small feat. It requires specific tools and skills. You can do it all on your own, but with the helping hand of an ERP solution, you can ensure you’re keeping up with the fast pace, complex billing structures, and detailed cost tracking in the majority of project-based businesses. NetSuite ERP for project management gives users a unified, real-time view of progress, streamlines your billing/revenue processes, and optimizes resource allocation. 

With data showing improvements in efficiency, resource utilization, and billing accuracy, it’s clear that NetSuite ERP is a powerful tool for any project-based business looking to streamline operations and drive growth.