Government Contractor Effectively Handles Both Government and Private Sector Work after Switching to An Integrated Business System
Apex Environmental, Inc., based in Rockville, Maryland, is a comprehensive health, safety, and environmental services company specializing in consulting and remediation. The growing company is comprised of professional, technical, and field experts located in ten offices to assure both national and local coverage in 25 states. Services include compliance, environmental assessments, remediation, health and safety, program management, energy management, and information technology. Approximately half of the firm's work is performed for government agencies while the other half is done for private industry.
Complex data tracking and reporting
The work of Apex's accounting and administrative staff is complicated by both the diversity of the firm's services and the fact that it serves both government and commercial clients. In addition to being an environmental consultancy that simply charges fees for professional services, Apex also has a $6 million construction division that performs actual remediation work in the field. To support this division, the office staff must handle construction-related activities such as generating purchase orders, managing subcontractors, and hiring and paying construction workers.
Serving both government and private clients further complicates matters. Although both types of clients require the careful tracking, reporting, and invoicing of actual labor and direct project expenses, that is where the similarity ends. The company's government clients require strict adherence to a host of additional requirements as defined by CAS, FAR and DCAA. In particular, for all of their government contracts, they must meticulously account for allowable overhead expense (can actually vary 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.
Apex has tried several different ways of handling this complex mix of data tracking and reporting requirements. During its first few years in business, the firm used a manual record keeping system. When it outgrew that, the first step toward automating operation was the purchase of a basic accounting program. This system managed the financial aspects of the business but offered no support for the governmental reporting requirements. Next Apex purchased an accounting system designed specifically for government contractors. While this program did a better job at managing information needed for government reporting, its project management and general reporting capabilities were weak. "I could satisfy the government but I couldn't give managers the information they needed to do their jobs," says Shannon Winston, controller, Apex Environmental Inc. To make up for the lack of functionality in the accounting software, office personnel used programs such as Excel, Lotus, and Word to generate reports and other documents in formats they needed. As a result, they were constantly re-entering data from the accounting system into these other programs.
When the firm decided to replace this piece-meal system with something more suited to its varied needs, the most important requirement for the new software was flexibility. "We didn't want different software for different types of work," says 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 also a consideration. There were good accounting systems selling for $100,000 that could have handled Apex's needs, but these were ruled out because that was more than the company wanted to spend. A third requirement for the new system was that it ran on Windows PCs. This was several years ago when some Windows-based programs were simply older DOS programs that had been ported to the new platform. "We wanted to take advantage of the latest Windows technology, so we focussed the search on software written specifically for Windows," says Winston who had been a programmer prior to coming to Apex. She found only two programs combining project management and financial accounting functionality that met all these requirements.
Flexibility Is Key
Apex chose the Wind2 Financial Management System (FMS) from Wind2 Software, Inc., located in Fort Collins, Colorado. This program 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. Apex chose it because it is flexible enough to handle the company's mix of clients and activities. "We needed an application that would let us focus on being a smart business first, while still handling our government contract specific needs completely. 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" said Winston.
The flexibility of Wind2 can also be seen in the way it adapted to meet the needs of Apex's construction division. "Although Wind2 was not designed as construction software, it is versatile enough to support what we need to do for the construction division, such as generating purchase orders and showing compliance with the Davis-Bacon law," says Winston. "Flexibility is really what makes this program so well suited to a company like ours that has all the these different activities going on." Another point in Wind2's favor was the fact that the vendor works closely with suppliers of other business applications to ensure that they work well with Wind2. Apex purchased human resources and fixed asset management programs from other vendors to create an integrated business applications suite based on Wind2.
While Wind2 came with over 300 standard reports, including Incurred Cost Submissions and the DD 250, SF 1034 and 1035, there were still a few reports that needed tweaking to meet Apex's specific needs. Winston spent some time using Crystal Report Writer to create the specialized reports they needed. For example, to comply with the Davis-Bacon law, they must report payroll information weekly in a highly structured format. In the past they generated the report manually in Lotus after typing in the relevant data from the accounting system. Now payroll data is collected in Wind2 and the report is automatically generated at the click of a mouse. "We were able to discontinue our use of Lotus and Excel for almost all reporting," says Winston. "We now get most of our information using standard and customized reports of Wind2 data."
Within two months of installing the new software, Apex was able to reduce its accounts payable staff from six people to five. Part of that was due to the efficiency gained by not having to manually calculate expense rates or enter data into two systems to prepare reports. "We used to have to calculate indirect expense rates manually, but now Wind2 calculates them automatically. And the best part is, when I checked Wind2's rates against my manual calculations-they came out to the penny" said Winston. Another reason for the reduced staff count was the immediate access to financial and project data that the accounting staff did not have in the past. Previously when a vendor called asking about a payment, they couldn't query the database to find the answer. They had to look up hard copy reports and files. With Wind2, they simply find the vendor record and drill down into the database to see all the related invoices and payments.
Decentralizing Operations
Although Apex originally deployed the Wind2 system at the corporate office only, the company has enabled remote offices and employees full access to the system via the internet using Microsoft Windows, Terminal Server Edition. According to Winston, enabling Wind2 FMS to work in this environment was trouble-free. "We changed the platform without one glitch, " she says.
The new remote access configuration is especially helpful to managers in outlying offices. Previously, they received updates from the home office on the status of their projects twice a month. With access to the Wind2 database, they can now view job status data and run reports at any time. The system also gives them a better ability to sell their services by letting them configure reports and invoices according a client's unique needs. For example, one of the remote offices wanted to bid on a job for a city government that required invoices to contain an explanation for every hour that is billed. With Wind2 and remote access, the manager of the office was able to access the time data in Wind2, which contained notes about the tasks that had been performed, and use the software's report writer to develop the specialized invoice. "That's impossible with a centralized accounting approach because everyone has to conform to processes that someone else has defined," explains Winston. "With remote access to Wind2, managers can go through any hoops their customers require."
Apex also recently upgraded Wind2 system from a file server database to a SQL client server database. This move has further enhanced the stability of the Wind2 system. Winston commented, "One of the things that we like most about Wind2 is they are always looking for ways to make the product work better for us. Whether that is with cutting edge technology like the SQL update, or with new features and functionality."
An integrated business system is enabling Apex Environmental to be more efficient in both private and public-sector work. At the home office, the system boosts efficiency by eliminating the need to enter data into multiple programs or make manual calculations to fulfill a wide range of reporting and billing requirements. In outlying offices, it gives managers ability to keep on top of projects and also compete more effectively for new work. Yet the cost of implementing the Wind2 system was quite reasonable in comparison to the alternatives. All in all, it has more than met the requirements of the company.
Source: Wind2 Software, Inc.