A Case Study on Selecting Contract Management Software

Professional services firm cuts costs and improves productivity with integrated software system.

"I could satisfy the government, but I couldn't give managers the information they needed to do their jobs," says Shannon Winston, Controller for Apex Environmental.

Apex Environmental, like many professional services firms with a competitive edge, offers a widely diverse group of services to both government and commercial clients. Managing and accessing data is critical with every contract. Recently ? after years of using multiple software systems, supplemental spreadsheets, and manually transferring data from one incompatible system to another ? Apex Environmental purchased and deployed a single software system (developed by Wind2 Software ? www.wind2.com) that handles the entire operation and serves both public and private sector clients with an integrated package. The new system streamlines planning, management, and reporting requirements for the entire company. It also helps contract managers win more contracts, manage them more efficiently, and make them more profitable because it automates the entire process ? addressing everything from the initial technical proposal to the DCAA close-out audit with greater efficiency and reliability.

Business Complexities:

As a comprehensive health, safety, and environmental services firm, Apex Environmental specializes in consulting and remediation work. The firm's professional, technical, and field experts are located in 10 offices across 25 states, and services include compliance, environmental assessments, remediation, health and safety, program management, energy management, and information technology.

All clients, of course, require careful tracking, reporting, and invoicing of actual labor and direct project expenses. The company's government clients, however, also demand strict adherence to a host of requirements as defined by CAS, FAR and DCAA. In working with their government contracts, Apex staff members must meticulously account for allowable overhead expense (which can vary considerably from contract to contract); they must follow strict guidelines for time and expense entry; and they must report project direct and overhead charges on pre-approved government forms.

In addition to being an environmental consultancy, simply charging fees for professional services, Apex also has a $6 million construction division that performs actual remediation work in the field. In support of this division, Apex staff must also handle construction-related activities -- generating purchase orders, managing subcontractors, and hiring and paying construction workers.

Searching for Solutions:

Apex Environmental has attempted to handle this complex mix of data tracking and reporting requirements in a variety of ways over the years. During its first few years in business, the firm used a manual record-keeping system. Quickly outgrowing the manual system, company leaders purchased a basic accounting program in an effort to automate the operation. That program managed the financial aspects of the business, but it offered no support for the governmental reporting requirements.

Thinking they had found the answer, Apex purchased an accounting system designed specifically for government contractors. While this program did a better job of managing information needed for government reporting, its project management and general reporting capabilities were weak. In an attempt to make up for the lack of functionality in the accounting software, office personnel used several spreadsheet and word processing programs to generate reports and other documents in the formats they needed. As a result, staff members were constantly re-entering data from the accounting system into these supplementary programs ? a time-consuming and frustrating duplication of effort.

"I could satisfy the government, but I couldn't give managers the information they needed to do their jobs," says Shannon Winston, Controller for Apex Environmental.

When the firm decided to replace this piece-meal system with a more powerful and useful software system, the most important requirement for the new software was flexibility.

"We didn't want different software for different types of work," explains Winston. "The software we were looking for had to have the flexibility to do everything we needed it to do on both private and government-sector work."

Cost was another consideration. Apex leaders wanted a system that could meet all current needs, expand its functionality to meet future needs, and still sell for a reasonable price. The company simply did not want to spend $100,000 for a software system, even one that could handle their needs.

Meeting Contract Requirements and Business Goals:

After extensive investigation and product comparisons, Apex Environmental decision-makers chose a business system from Wind2 Software that fully integrates general accounting functions with project invoicing and reporting, budget control, profit analysis, employee management, cost proposal development, accounts receivable tracking, and government contract management. The system is flexible enough to handle the company's mix of clients and activities today, and its scalability makes it capable of doing more as the company grows.

"We needed an application that would let us focus on being a smart business first, while still handling our government contract specific needs completely," says Winston. "Wind2 enables us to efficiently handle all of the requirements of our federal, state and local government projects, without sacrificing good, solid and simple business practices. That flexibility is really what makes this program so well suited to a company like ours that has so many different activities and a mix of government and private sector work."

Like all government contractors, Apex Environmental must comply with all government accounting requirements (e.g., FAR, CAS, Incurred Cost proposals, DCAA guidance) and prepare for government audits. According to Winston, the company is saving hundreds of man-hours every month by eliminating the use of spreadsheets and simple accounting software to meet the stringent audit and reporting requirements of their government contracts. These resources are now freed to support ongoing work and to land new contracts.

Apex's new software is fully equipped to meet the 17 contract and billing types defined by DCAA, including fixed price, cost-plus, and time and materials. It addresses "Other Transaction Authority" (OTA) contracts and handles timekeeping practices, direct and indirect costs, overhead and G&A rates, unallowable costs, pre-award costs, incurred cost proposals and invoicing properly.

Within two months of installing the new software, Apex was able to reduce its accounts payable staff through attrition from six people to five. Staff members no longer need to manually calculate expense rates or enter data into two systems to prepare reports. And they have immediate access to financial and project data that has been unavailable to them in the past.

Winston explains it this way: "When a vendor calls asking about a payment, staff members can now query the database to find the answer. Instead of searching through old hard copy reports and files, we simply find the vendor record and drill down into the database to see all the related invoices and payments."

According to Winston, Apex Environmental now has the system it needs to handle its complex spectrum of government and private sector work. And company leaders know that as their business continues to grow and evolve, the Wind2 system's inherent flexibility and scalability will let them expand its functionality in any direction they chose to go.

Case study provided by Wind2 Software, Inc. in conjunction with Virtual Contract Manager, LLC (www.virtualcontractmanager.com). Wind2 has more than 3,000 client companies in North America, Wind2 delivers software solutions for government contract management, timekeeping, contract costing, billing, project management, financial accounting, customer relationship management, and marketing automation. Contact: Nicholas T. Bettis, Tel: 800-779-4632. Fax: 970-493-4578. E-mail: [email protected] www.wind2.com

Virtual Contract Manager, LLC is a one-stop "information" shop for and about Contract Managers. We provide a suite of FREE locator tools for contract management software solutions, attorneys, consultants, software escrow services and a whole lot more! Let us help you find a Contract Management software solution by saving you weeks, if not months, of preliminary market research. Contact Lisa DeMaio at 508-668-2811 or [email protected] or visit us at http://www.virtualcontractmanager.com

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