Chapter 16: ERP Project Management

With things looking up for their business, Saf and Mel both agree that it’s time they look into expanding Spindl’s catalog. This is a huge undertaking for them because it involves third parties such as designers, suppliers, etc. It comes down to juggling time, cost, and quality.

Given everything on their plate, it’s important to the duo that they manage their resources well. Systematically planning this project will ensure that it’s completed in a timely fashion, while keeping costs under budget, and the quality up to their standard. To aid in this process, Saf and Mel turn to Spindl’s ERP Project Champion, Lyn. Lyn introduces them to the Project Management module in their ERP. Using this, Saf and Mel can manage projects by breaking them into tasks that can be allotted to people.

Why use ERP for project management?

Right from the conception of your business, a key factor for success has been (and will continue to be) your company’s project management process. With every passing day, the growth leads to newer people, tasks, and teams; the collaborative effort still exists, but as your company diversifies, it can become difficult to properly track and manage projects. The risk of wasted resources and growing overheads can be avoided with a streamlined project management process.

Keeping that in mind, we’re going to learn how you can take advantage of the project management module in your ERP system—using which you can create, manage, and monitor every single project from right within the system. Purchasing and selling can be tracked against projects, helping you keep track of the budget, delivery, and profitability. It can also be used to manage internal projects, manufacturing jobs, or service jobs.

An important bit to note here is that the success of project management depends entirely on the people involved; merely setting it up won’t do the trick—people must follow through with it and keep updating the project to keep it moving smoothly.

Breaking down the workflow

Most (if not all) of the terms below are fairly commonly used. Let’s quickly take a look at how they work in the context of an ERP system.


A project is a record that maintains the details of your project and milestones that you have set for any undertaking. The project record can be linked in quotations, sales orders, delivery notes, sales invoices, purchase requests, purchase orders, and purchase invoices. This way you can keep track of all the activities that happen around this project.


Every project is broken into tasks and each task is allocated to a resource. Some ERP software allows you to create and allocate a task independently of a project. Tasks are an incredibly powerful tool for organizing and breaking down your project into bite-sized, doable missions for your team. Most ERP systems will allow you to set priority, start and end dates, dependent tasks, assign departments and users, expense claims, etc.


A timesheet is a consolidated document that helps your team track their working hours, broken down by how much time was spent on which task (and what activity). These details can help gauge individual productivity, reduce overheads, and set the right expectations for various tasks. You can create timesheets to track billable work for customers. These timesheets can be tracked against the project and tasks so that you can get reports on how much time was spent on each task or project.

Project Cost

Each project—which comprises tasks—is bound to cost a certain amount of money. To track the cost of a project (primarily considering services), timesheets are evaluated for the actual time spent on each task/project. This is only possible if timesheets are accurately tracked. This is especially helpful in monitoring the budget for the project.

Project Profitability

A project is rarely linear. Throughout each project, new developments take place. These can lead to more investment in terms of time, money, material, etc. Based on all the income and expense entries against the project, you can generate a profitability analysis report for a project. The profitability of a project is the difference between the revenue generated from a project, versus the costs associated with it. This helps you stay on track and ensure you don’t overspend.

Setting up a workflow

Now that the project management module has been implemented, Saf and Mel assemble their team. They discuss the project at hand—designing the summer clothing collection for Spindl. After preliminary meetings, they begin using the ERP module to manage the project.

  1. The main project is created. Details including project name, status, type, completion progress, list of tasks, priorities, assignments, etc. are all entered and maintained here.
  2. Each task is assigned to employees from various departments. This gives each employee a clear direction of their actionable duties, deadlines, etc. It also is used to enter any expense claims for resources spent on completing the task.
  3. Employees can track timesheets against their assigned tasks. Using their timesheets, they can enter details of the type of activity, time spent, any billable activities, other notes, etc.

The project cost and project profitability are both consistently monitored as the project develops. Using these two reports, the administrative employees can ensure that resources are being used most optimally.