Microsoft Dynamics Customer Solution Case Study

Major Contractor Boosts Revenue with Job Cost, Service Management System

Overview “We have effectively established 100 percent Country or Region: Canada confidence in the financial data with the WennSoft Industry: Building and Construction and Microsoft Great Plains solution.” Customer Profile Bobbi Bhangu, Chief Financial Officer, ESC Automation ESC Automation is the largest contractor in British Columbia, Canada, and a leader in the northwestern United States for Direct Digital Controls supporting ESC Automation is a market leading Direct Digital Controls HVAC, lighting, and security access systems. contractor. With a large and growing base of Delta Building Automation Control Systems, ESC does business with a who’s Business Situation Explosive growth demanded cost who of prominent clients. Success of this magnitude requires a controls and project management to sound financial, job costing, and service management system. ensure a “boom” outcome. ESC made the decision to upgrade its business management Solution system to meet its immediate needs and support future planned The company moved from its previous financial package to Microsoft® Business expansion. After an exhaustive search for software to manage Solutions–Great Plains® and deployed these critical functions, ESC chose Microsoft® Business WennSoft Job Cost and Service Management series. Solutions–Great Plains® (now part of Microsoft Dynamics™) in combination with WennSoft Job Cost and Service Management. Benefits  Annual revenue up CDN$1 million The new software will facilitate the cost control and project  Standing inventory reduced 7 percent financial management required for this rapidly growing, multi-  Cost variances down 1600 percent  Support staff down 40 percent faceted contracting and construction business.  Bond reporting reduced 240 percent

“We found that Situation to recognize that much revenue. But, being ESC Automation (ESC), headquartered in tracked manually on spreadsheets, items WennSoft Job Cost Surrey, British Columbia, Canada, installs were missing, and ESC ended up paying proved to be a more and services automated building control for products or labor which were not billed systems and is the largest Direct Digital to our customers. Our revenue was not comprehensive and Controls contractor in British Columbia. steady; we recognized too much or too little robust solution due to Signature installations include the revenue, and we had no way to forecast.” Vancouver International Airport and the Furthermore, once the jobs were complete the tight integration city’s prominent Science World and Library maintenance contracts were also tracked with Microsoft Square facilities. by spreadsheet, and in many cases ESC often gave away free services after the Business Solutions– With anticipated acquisitions and market fact. Great Plains.” growth, it was apparent that supplying effective financial, job costing, and service “We had no real service revenues,” Bobbi Bhangu, Chief Financial Officer, ESC management capabilities was critical to the Bhangu recounts. “We manually tracked Automation ongoing success of ESC. The company service calls, and that posed huge was tracking its construction jobs and problems. Facilities managers would call maintenance contracts on spreadsheets, a us, and we’d fix something on their sites process which became very ineffective for without a purchase order. Then we’d bill for managing current business and was it, but we had difficulties collecting for the evidently not able to support the growth. services without proof of the services being ordered. ESC’s old financial system was not effective in tracking the labor and products “My commitment to the executive team used on the jobs and, accordingly, the was to create a system that guaranteed company could not match actual job costs accuracy in the financial numbers, critically with estimates and had challenges controlled costs, accurately invoiced recognizing revenue. In addition, ESC was customers, and stimulated profits and keeping an excessive inventory, which also sales. Building confidence in the financial proved challenging to manage and track reporting was key to our profitable success against jobs. as we grew,” states Bhangu.

“We are dominant in this market, and we Solution are experts at estimates,” says Bobbi Bhangu and the ESC team began a Bhangu, ESC’s Chief Financial Officer. “But comprehensive search for a job costing we realized that without an effective system and service tracking package to help them we could not manage the many cash flow manage labor and product costs and to issues because we couldn’t look at our create a maintenance contract system. costs accurately and determine how much we needed to bill. “We found that WennSoft Job Cost proved to be the most comprehensive and robust “We’d estimate how much of a job was solution due to its tight integration with complete,” she continues, “and we’d decide Microsoft® Business Solutions–Great Plains®,” says Bhangu. She knew that the Originally, ESC installed the Microsoft product’s job costing functionality would not Great Plains and WennSoft applications on be useful if it was not integrated with a local machines, with Microsoft SQL strong enterprise resource planning (ERP) Server™ version 7.0 database installed on solution. a single Dell PowerEdge 4400 running the Microsoft Windows® 2000 Server operating “We also required service tracking system. Since that time, the company has functionality, which WennSoft (a Microsoft upgraded to Microsoft SQL Server 2000 Gold Certified Partner) offers with its Standard Edition and installed Windows Service Management Series, and that was 2000 Terminal Services on a second the deciding factor,” continues Bhangu. server, so that users now log in without a “Obviously, the fact that it worked with local installation of the application software. Microsoft Great Plains made WennSoft a much better solution in our estimation.” Since the initial installation, Abacus The WennSoft Job Cost and Service Enterprise Solutions, recently acquired by Management Series are tightly coupled Encore Business Solutions, has provided with Microsoft Great Plains, with more than ongoing account management and will 80 points of integration. As a result, the end continue to work closely with the ESC team user cannot tell at any given time whether a to help ensure smooth running of the piece of data or functionality is associated system. with Microsoft Great Plains or WennSoft. Benefits ESC has turned profitable with help from WennSoft Job Cost includes a variety of the new environment by automating critical features such as labor, equipment, and business and accounting practices. “Once sub-contractor management, along with the WennSoft and Microsoft Great Plains change order management, billing, and solution was in place and coupled with a accounts receivable. The Service change in our management team structure, Management Series includes service call we saw immediate results from the new assignment, tracking and resolution, and platform by automating critical business maintenance contract administration. and accounting practices,” says Bhangu.

ESC chose Deloitte and Touche, Inc. as an Enhanced Cost Control implementation partner for the solution. By supplying effective financial, job costing, ESC and Deloitte started work in August and service management capabilities, 2000 and had the new system up and Microsoft Great Plains and WennSoft running by October of the same year, helped to critically control costs, accurately according to Petra Haas, the Deloitte invoice customers, and stimulate profits project manager at the time. Deloitte used and sales. its Express Methodology, a form of Rapid Application Deployment, and integrated  Annual Revenue Increased by CDN$1 both Microsoft Great Plains and WennSoft Million with its existing payroll system. Accurately documenting and billing for construction change orders turned one critical area of red ink into black. “Prior to ESC’s lack of a job costing system had implementing the Great Plains and caused unpredictable discrepancies WennSoft system, ESC would bid for the between the total dollars the company change orders and do the work, but they predicted for an installation effort and the would rarely be incorporated into the final outcome. Improper billing for products contract, and therefore never billed,” and labor, not charging for change orders, Bhangu recalls. and poor inventory management all contributed to the gap between “Now, being able to track and bill for expectations and reality. change orders with WennSoft Job Cost has easily generated CDN$500,000 per year in “Before, actual costs could run 30 percent additional construction revenue, and over estimate,” says Bhangu. “Now with another $500,000 for service revenue since WennSoft Job Cost, we have variances of the original implementation in 2000.” only plus or minus 2 to 3 percent,” she explains.  Standing Inventory Reduced 75 Percent Inaccuracies in inventory records meant “As a result, we can accurately assess the that ESC had to maintain much larger percentage completion of a job and its stocks than needed. The company was not subsequent associated costs at any point able to return products easily, and could during that job’s progress. This means that not always track what was on hand. we can recognize revenue and bill properly based on those highly accurate numbers.” The WennSoft materials management feature and the Microsoft Great Plains  Increased Accuracy in the Recognition of Inventory Management component link Revenue products used on the job with inventory Recognizing revenue quickly and tracking. This function has enabled ESC to effectively has increased the bottom line, reduce its standing inventory over 75 streamlined procedures, and generated percent from CDN $1 million to between faith in the accounting numbers. CDN $200,000 and $300,000. “In construction it takes 60 days or more to “Now transactions don’t get lost and get a payment, but the products and engineers don’t over-order products, services need to be paid for in 45 days,” because we can track exactly what we Bhangu explains. “You have to pay for need and drop-ship supplies,” Bhangu labor which hasn’t been billed. Because we adds. “Out of a million dollars in inventory couldn’t accurately recognize revenue by at any given time, $400,000 of it used to be correctly calculating the POC (percentage obsolete. Now obsolescence has been of completion) of a job, we would bill virtually eliminated with the new Microsoft inaccurately and get behind,” she explains. Great Plains and WennSoft system.” “WennSoft Job Cost solved our problem.  Cost Variances Down 1600 Percent Now we run the percentage of completion routine at the end of a billing cycle, and it’s done in 10 minutes for 200 jobs. We can bill, report, and forecast with precision.”  Simplified Payroll Procedures Prior to the implementation, ESC was  Created New Revenue Stream calculating payroll and job costs in two ESC implemented an aggressive plan to separate systems and spending excess grow revenues from service contracts. With amounts of time attempting to reconcile the a significant investment in manpower and differences. The integration of WennSoft resources, the WennSoft Service and Microsoft Great Plains with its payroll Management tool complemented the system eliminated the double entry and the company’s growth plans and effort required to resolve the differences accomplishments, contributing to a smooth resulting in a 50 percent reduction in and managed growth with enhanced administration effort. system capabilities to ensure high customer satisfaction levels along with “WennSoft and Microsoft Great Plains’s profitable business. integration with our payroll system is invaluable,” states Bhangu. “It saves “With WennSoft Service Management,” considerable time in the end with Bhangu explains, “we can push a button administrative expenses, and we no longer and generate invoices for every have a discrepancy between posted labor maintenance contract we have. And if costs and payroll.” customers are not on a maintenance contract we won’t provide them free  Reduced Time on Task support unintentionally, because the Tasks such as collections, billing, and the system tracks all of that information. documentation of requirements for construction bonding companies all shrank “We are now experiencing industry dramatically once the new system was in standard margins, and we would not have place, eliminating the need for 30 percent been able to grow our service business if additional head count in accounting. we didn’t have strong systems in place like WennSoft and Microsoft Great Plains, and, In the case of generating reports for the most important, we have happy construction bonding companies, reports customers.” Bhangu, “Microsoft Great Plains and WennSoft brought one week’s work down Reduced Support Requirements to two minutes.” The labor savings ESC encountered via streamlining its processes with WennSoft As for billing procedures, “We're down from and Microsoft Great Plains also contributed three or four days to approximately one significantly to the company’s bottom line. day,” Bhangu claims. “And the collections According to Bhangu, ESC reduced management feature of Microsoft Great accounting staff by 30 percent and Plains helps us, too. We acquired a administrative staff by 50 percent as a company in the United States, and our result of efficiencies gained from the new collections person could still do the same software. job—in addition to taking on the billing For More Information responsibilities. We didn't take on new Microsoft Dynamics For more information about Microsoft overhead with the new company.” Microsoft Dynamics is a line of integrated, products and services, call the Microsoft adaptable business management solutions Sales Information Center at (800) 426- Summarizing ESC’s experience with that enables you and your people to make 9400. In Canada, call the Microsoft WennSoft and Microsoft Great Plains, business decisions with greater confidence. Canada Information Centre at (877) 568- Bobbi Bhangu puts it simply, “We are very Microsoft Dynamics works like familiar 2495. Customers who are deaf or hard- pleased with our decision to purchase and Microsoft software such as Microsoft of-hearing can reach Microsoft text implement the Great Plains and WennSoft Office, which means less of a learning telephone (TTY/TDD) services at (800) system. It has met our expectations with curve for your people, so they can get up 892-5234 in the United States or (905) respect to management and performance. and running quickly and focus on what’s 568-9641 in Canada. Outside the 50 The implementation team was timely and most important. And because it is from United States and Canada, please professional and implemented on time with Microsoft, it easily works with the systems contact your local Microsoft subsidiary. a minimum disruption to our business. We that your company already has To access information using the World give the team and the system the highest implemented. By automating and Wide Web, go to: www.microsoft.com possible marks. streamlining financial, customer relationship, and supply chain processes, For more information about WennSoft “Within the company,” Bhangu concludes, Microsoft Dynamics brings together people, products and services, call (262) 821- “We have effectively established 100 processes, and technologies, increasing 4100 or visit the Web site at: percent confidence in the financial data the productivity and effectiveness of your www.wennsoft.com with the WennSoft and Microsoft Great business, and helping you drive business Plains solution. We would not have been success. For more information about ESC able to grow our business if we didn't have Automation Inc. products and services, such strong systems in place.” For more information about Microsoft call (604) 574-7790 or visit the Web site Dynamics, go to: at: www.energrated.com www.microsoft.com/dynamics

Software and Services Hardware  Microsoft Windows Server System  Dell PowerEdge 4400 − Microsoft Windows 2000 Server − Microsoft SQL Server 2000 Partners  Microsoft Dynamics  Abacus Enterprise Solutions (recently − Microsoft Business Solutions–Great acquired by Encore Business Solutions) Plains  WennSoft  Solutions © 2005 Microsoft Corporation. All rights reserved. This case − Wennsoft Service Management study is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN Series THIS SUMMARY. Microsoft, Great Plains, Microsoft Dynamics, Windows, and Windows Server System are either registered trademarks or trademarks of Microsoft Corporation in the United States and/or other countries. All other trademarks are property of their respective owners.

Document published July, 2005