How architecture and engineering firms can boost performance, agility, and profitability
According to Deltek’s Clarity Architecture and Engineering Study, despite a successful financial year, architectural and engineering firms have concerns.
How do you continue to remain profitable while addressing economic challenges, talent shortages, and investments in technology?
Our 2023 Finance Leaders Survey surfaced similar insights. Finance leaders across all industries are facing challenges: inflation, rising energy prices, an ongoing recession, and talent shortages.
We're seeing it across the board—economic challenges coupled with industry talent shortages which lead to concerns about sustaining profitability. For A&E firms who rely on pursuing the right projects for profitability, how do you plan ahead when you’re looking at gaps in your workforce?
With profitability top of mind, finance leaders are focused on finding innovative ways to increase efficiency and generate insights so they can continue to guide the business forward—and remain profitable.
The road to digital maturity is paved with technology
Automation has a role to play in helping firms meet these challenges and maintain profitability.
Recognizing the importance of technology and the role it plays for finance leaders, A&E firms have borrowed strategically to invest in new assets so they can capture efficiencies for near-term growth. It’s predicted that this year, the main technology investments will be in project management and financial performance management. But the cost of technology is a barrier to implementation.
Our survey saw the same—while skills and training was cited as the biggest barrier to automation, funding was a close second. So regardless of industry, finance departments are looking to automation to increase efficiency, but cost is a significant barrier.
But time is money too. For a lot of decision-makers, manual tasks—like data collection, entry, and reporting—take up valuable time. Streamlining those tasks with automation would free up time, so leaders and their teams can focus on providing strategic value – like project and financial visibility and management – to their organizations so they can watch their profitability soar.
To get started, or continue on, the path of digital transformation, A&E firms should:
- Critically evaluate business processes
- Identify areas for automation
- Streamline workflows with technology so they can focus on high-value tasks
Getting buy-in to move away from outdated, legacy systems isn’t easy, but it’s a critical component for successful automation.
The right investment in technology is the catalyst for aligning your people, projects, and profitability in real-time.
Continuing financial performance
2022 was, by all accounts, a successful finance year. There were notable boosts in utilization rates and multipliers for net labor and total payroll—and this resulted in the doubling of operating profit on net revenue.
What does this mean for A&E overall? It highlights the importance of skills and experienced contributors. But with unpredictable economic conditions, it’s still necessary for firms to look for strategic ways to retain and upskill talent.
What does this mean for automation and technology?
According to Deltek’s study, investments in greater automation and continued process evolution will enable firms to continue to refine their talent strategies. Improved employee experiences will not only aid in retaining talent, but also attracting it, giving A&E firms a competitive advantage in sustaining their financial growth.
And the finance leaders in our survey agreed. Making investments in technology—like cybersecurity; planning, budgeting, and reporting; risk management; or Artificial Intelligence—will expand their capabilities, allowing for more agility in the face of uncertainty.
While we can’t predict the next wave of challenges, we can be prepared. For A&E firms, getting the right technology, people, and processes in place will support that. Implementing a Financial Performance Platform can help pave the way for a digital transformation that will shape a profitable future.
