Getting paid and managing cash flow can be an ongoing struggle for contractors.  While chasing down certain customers to collect payment is a struggle that will never go away, one priority we established at our contracting business was that we must have our own clerical house in order.

More specifically, although we perform over 1,000 separate jobs each year, we must make certain that we absolutely never forget to create and send an invoice for work that’s been completed. By building a series of checks and balances into our Job Management System (JMS) software, it has become nearly impossible for this to happen.

First, we employed a system that uses “statuses” which dictate what each employee sees on his or her dashboard. Salespeople and estimators need to see different information than project managers, accountants and so on. These statuses are what guide a job through the process from initial bid request through final payment.

If a person see an item on their “to do” list that’s already been done, they’re going to investigate and figure out where the ball got dropped. Specifically, if a project manager sees a job on his list of jobs to schedule that he’s already overseen the completion of, he’s going to notify the person who is responsible for billing.

This is a good step, but it’s still not enough. People make mistakes, get sick or quit. A system that relies exclusively on people is still prone to mistakes. Furthermore, from a high-level management perspective, we need to have tools and reports that give us information about employees following their procedures without us having to go snooping around and spying on them.

By having our timekeeping and payroll reporting system integrated with our JMS, we created a report that shows all jobs where employees have reported time on, but that are still on a status “up stream” from the invoicing process. For example, if hours have been reported on a job that is still on the “scheduled” status, it’s possible that it needs to be invoiced.

Now, at any given time, this report will yield results for projects that are still “in process.” If a project will take two weeks to complete, it will appear on this report until it’s completed and invoiced. Nevertheless, an owner or manager has a powerful tool to run weekly or as needed to ensure that the company never forgets to send an invoice.