Project-based enterprise resource planning (ERP) systems provide an end-to-end business solution for all company departments that generate revenue by conducting complex projects. These systems contain modules that address financial management, project and resource planning, sales and marketing, as well as project risk and governance. By recording all project-related information, companies gain visibility into the type of projects that are the most profitable. Industries utilizing a project-based ERP system include engineering, construction, and government contractors. Project-based ERP systems require precise tracking of the profitability of each project and portfolio. This type of software is used mainly by members of the project management office department, such as project and program managers or analysts.
There are two major types of project-based ERP solutions:
- Focused best-of-breed software, which focuses exclusively on project-based industries.
- Broader ERP systems that provide features for project-based companies combined with functionality for manufacturing or distribution.
While product-based businesses generally utilize ERP systems, project-centric manufacturers use a project-based ERP system to better plan and monitor operations. This type of software should not be confused with project management software, which only focuses on projects and does not provide features for operations. These systems may also integrate with CRM software and human resource management systems.
To qualify for inclusion in the Project-Based ERP category, a product must:
- Include functionality for project, program, and portfolio management
- Provide an end-to-end solution for all project-based work of a company
- Track and record resources and costs on a project and portfolio level
- Deliver front office (sales and marketing) and back office (procurement) features
- Manage suppliers, subcontractors, contracts, as well as bids and RFPs
- Support project-accounting features as well as time and expense tracking
- Integrate with or provide modules for HR, workforce management, or payroll
