Objective
Our Construction-industry client was about to start work on a new large-scale project, as part of an equal Joint-Venture. They asked us to assist them with determining best process for long-term management of the Joint Venture project. The processes had to cover the business and software needs of both the involved parties. We had to provide a process which would allow for management of the project tasks and costs within each business, and the within Joint Venture. Critically, the processes need to work for each business without requiring large scale process change.
Solution Delivery
- We put together a short questionnaire for both businesses to review and then discuss together. It included considerations such as legal structures, tax requirements, client requirements (including billing), profit recognition mechanisms and project management controls.
- We received a response from both businesses, which primarily included their agreed method of managing the JV and the project. There was a decision made as to which of the businesses would “host” the Joint Venture processing, which would be managed as a separate legal entity.
- With the information returned, there were three sets of processes to align – the processing within the Joint Venture; the project processes for work performed by Client A; and the project processes for work performed by Client B. Fortunately, both clients were using the same ERP software. This meant that we could thave consistent software processed used across both businesses. This was primarily around the way they would transact and manage their work on behalf of the JV.
- We had to consider how the data went from each business into the JV. The aim was to make this as simple as possible, so that there was a minimal amount of data mapping. It had to be manageable for each business to invoice the JV entity, and so that the JV entity could easily determine what it was entitled to bill the client for. We also had to have a way of clearly showing how much profit Clients A and B were progressively entitled to.
- We put together a short process map detailing overall processes for all three groups. Once agreed, we then performed the work required to make these changes operational, as well as allowing for the differences in processing required for each business. Once we had tested the setup and process, we performed a short education session with key staff in each business.
- It was quickly agreed that a level of system modification would be needed in order to export the information for billing from Client A and B. It would also help with importing their invoices to the JV with the needed transactional detail. We documented the functional and technical specifications, as well as coordinating the development work, testing and implementation.
- Due to the volume of data being moved and reviewed, some additional tweaks were required post cutover.
Achievements
- There were initial requests for further development changes, once the volume of processing for the project increased. These changes were to allow for simpler recognition of hours used on site by each business.
- Some support was needed to assist with data alignment for the first few months of invoices from Client A and Client B to the Joint Venture.
- After these initial adjustments, no additional work was needed. The process has run without incident for two-plus years for the active project.
If you’d like to learn more about this project or talk to us, click here for our contact details.
You must be logged in to post a comment.