If you’re trying to secure a budget for CAFM software you’ll have to convince your company’s FD that the figures stack up. But what else does a finance team need to hear to show you the money?
When it comes to agreeing to a new piece FM software your finance team’s support for the plan will be driven largely by the figures and potential ROI. But like other teams they’ll also need reassurance that a proposed solution won’t create extra work or disruption for them. And a vision of how it will make their lives easier.
4 benefits of a CAFM to share with your finance team
1. Show them the ROI
The finance team needs to see the cost benefits of the proposed software purchase in black and white to justify the outlay.
A good CAFM partner will be able to help you calculate potential ROI, estimating how much you will be able to save in certain areas based on previous client experience. In your presentation to the finance team you’ll need to be clear on the CAFM setup and running cost and offset that against the tangible cost savings, which are typically derived from::
- Reducing callouts - by improving first-time fixes, consolidating jobs to a single visit and spotting duplicate requests
- Avoiding non-service - by tracking breached SLAs, recalls and warranty so you’re not paying for callouts unnecessarily
- Avoiding equipment downtime - by being much more responsive and proactive which will reduce the impact on the usage of your facilities
- Asset lifecycle management - by analysing data to optimise performance and avoid wasting your budget on problematic equipment
You need to estimate percentage cost savings in each area to demonstrate how quickly the business could see a return on their investment - and how those cost savings can be increased in years to come through continual improvement initiatives.
2. Integrate and automate to save time, money and resource
Will integrating a CAFM system with the company’s finance software make a difference to the team’s speed and efficiency?
At the moment you might be submitting invoices from contractors directly to the finance team by email, your contractors may be directly billing them - or even a mixture of both. This can be a messy solution that is causing double handling, raising the potential for mistakes and generally wasting time and resource. With the right integrations your proposed CAFM system can.
- Auto send quotes to accounting platforms for PO approval
- Auto retrieve PO numbers
- Auto bill labour based on time/attendance and rate cards
- Auto send invoices
These are all features that will play well with a business wanting to improve governance and communication between FM and finance.
But if you’re proposing an integration like this, be sure you know what accounting software the team uses and if your chosen supplier can support it. Is there an off the shelf API or will bespoke work be necessary? Get as much detail as you can from your CAFM partner to convince the work can be done with minimum disruption.
Then there are the other features that can focus your FD on the extra financial controls a CAFM can bring:
- Set your agreed rate cards for contractors within the system so billing is always accurate
- Set a spend limit per work order to control expenditure
- Force the contractor to request an uplift where required so you can achieve a first-time fix and better manage your accruals
- Automatically trigger cost audits when the data doesn’t add up e.g. duplicate callout fees, manual rate overrides or when invoiced labour is higher than quoted.
Highlighting where CAFM automation can help control overspend and keep a tighter rein on budgets will always be popular with a finance team.
3. There will be better budgeting
The finance team wants you to be able to budget as realistically as possible. Overspend and unforeseen Capex requirements can throw a company’s entire budgets out of kilter, after all.
If you can show exactly how your chosen software will make budgeting easier and more predictable, then this will be a major plus for your finance team.
- Will better asset lifecycle management improve your ability to project maintenance and Capex spending?
- Will better communication improve your first time fix rate and reduce spend?
- Will better preventative maintenance reduce the cost of call-outs over time?
Having the tools to properly understand, predict and control spending will help the whole business allocate annual budgets more effectively and help you to stick to them.
4. Improved reporting and financial transparency
Will both FM and finance be able to look at the CAFM dashboard together and agree where money is currently being spent? Will it help you work out collectively how best to optimise financial performance?
Show your finance team the proposed CAFM’s dashboards, charts and tables that will help you keep track of everything that is happening with your finances.
- Set your own financial calendar and periods to suit your budget reporting
- See spend trends over time
- View budgets by Work Order Type e.g. Reactive / PPM / Capex
- View budgets by site/area or estate wide
- Track variance vs budget in real-time
- Account for accruals by editing your budget on the fly
If you’re going to win them round, the finance team will need to be convinced on the numbers and the ability of you and your CAFM partner to deliver on promised integrations and reporting capabilities.
A CAFM is a major investment for a business and there will be questions to answer. You’ll need to prepare and do your research if you’re going to secure the budget you need. A good CAFM supplier will have the data, case studies and references to back up your claims and help you with your business case.