From Spreadsheets to Systems: How Contractors Fix Disconnected Accounting with Gavin Dick

Rishi Srivastava (00:41)
Today our guest is Gavin Dick. Gavin, welcome.

Gavin (00:44)
Hey, Rishi thanks for having me.

Rishi Srivastava (00:46)
The theme of this episode is bridging the gap between construction finance and technology. The first section here, Gavin, is on your background and context. Gavin, can you start by sharing a little bit about your background and what led you to specialize in helping contractors streamline their accounting and back office systems?

Gavin (01:05)
Yeah, so I’m.

much more interested in the technology side of things in general. But I have a lot of family in construction. As you know, my parents are CFOs. You’ve had them on the podcast. before they really got me into construction, I was just kind of building a whole bunch of different automations and technology systems and stuff like that. And so I built things like, know, automatic cold email systems, report builders, that kind of stuff. And then they kind of showed me, my parents, that a lot of construction companies are really behind when it comes to any kind of accounting or administrative work. And it’s really tough to find people.

and they’re also super behind the tech. So they introduced me to some people and I kinda helped them build some software and systems and stuff in place to where they can streamline their accounting and back office processes and systems a whole bunch because again, like I said, it’s really hard to ⁓ good construction accounting people. And the rest is history, as they say.

Rishi Srivastava (01:54)
Yeah, generally construction tech stack. runs like 20 years behind compared to anything that’s state of the art.

Gavin (02:02)
Yeah, I think it’s also one of those things where, like I said, construction accounting is pretty niche. It’s hard to find people who understand it. And so, then you have to find people who are technical and then fluent in construction accounting. I think it’s just a mess in terms of finding people who understand it and can make the technology work.

Rishi Srivastava (02:18)
Right. What types of construction companies typically come to Atlas CFO for help? And what common pain points do they have when it comes to accounting and operations?

Gavin (02:29)
Generally the companies that come to us or any kind of commercial construction company, so we don’t necessarily come up care about the trade we deal with just about all of the the different trades as long as they’re commercial as For the pain points usually whenever they come to us They have like an ERP system and maybe a couple of extra accounting add-ons, but it’s not quite enough And so they the people doing the the entry it feels like they’re just bogged down super behind

and they need to hire a bunch of people in order to get caught up, but they can’t find anyone who understands it. The staff just kind of feels burned out. And I think it’s important to note from the visibility of different levels in the company, this can manifest in different ways. And so from the people doing the data entry, they feel super burned out, overwhelmed, there’s too much going on, and the leaders feel like they have a lack of visibility. Occasionally they might hear that the people are overwhelmed and burned out, but they probably hear that from most employees, and so they don’t quite understand it.

but they can see that they have a lack of financial visibility and that’s because the employees are so overwhelmed and bogged down, they can’t get the data in that’s accurate that we need in order to build any kind of reporting. And so another thing is a lot of times they either don’t have the time to find what software to add, build, fix, or they do have the time but they don’t have the expertise and they don’t want to mess anything up and going too gung-ho on adding software can cause a completely different problem because

We have these softwares where no one really wants to use or buy into, they don’t care about it. And so now we have a bunch more overhead with no real payoff. And so that’s usually what kind of companies come to us and where they’re at.

Rishi Srivastava (03:56)
these builders, are very good at building things, But sometimes they’re not as good at back office and tech stuff, you know, IT.

Gavin (04:03)
Mm-hmm.

Rishi Srivastava (04:03)
The next section here is on disconnects in construction systems. You mentioned that most contractors already have an ERP in place, but still struggle with disconnected workflows. What are some of the most common gaps you see between field operations and accounting?

Gavin (04:22)
Between field and accounting, usually we have, I’d say, two different problems. So we have the data collection problem, and then we have the data entry problem. And so the data collection problem is kind of from the field side, where they have to tell us, like, hey, this is the job that we worked on here, or the updated costs. Here are the cost codes that we worked on, the hours that we built to that job, all of that kind of stuff.

And so there can be some disconnects there because a lot of times we don’t necessarily have any kind of software in place that makes it super easy and streamlined for our PMs or our field people to tell us what’s going on. And so the accounting team has to kind of go and hound some of those people to get them some of the data. so, like, you know, I of mentioned the problem and that’s the fix, which is we kind of usually want to try and find some kind of field of PM software that everybody likes and makes it super easy to input stuff. And then sometimes there’s also some kind of incentive planning as well.

But that kind of depends on the company. After that, now we fixed the data collection problem, our data’s coming into accounting, so now accounting has to go ahead and enter all that stuff, so that that way we can get, say, materials or reports sent back out to field, and then I’d say that cycle kind of repeats. And so usually in terms of the gaps, like I was saying, it’s data collection, field needs to send in stuff, and the data entry that’s on the accounting side where they need to enter stuff in, then send the stuff back out to field.

Rishi Srivastava (05:34)
Why do you think so many construction companies end up relying on spreadsheets and email approvals even after investing in major ERP systems?

Gavin (05:43)
Most of the time whenever I see that, reason they end up doing that kind of stuff is because they don’t have a software that does the function they’re trying to do. So they’re trying to do some kind of manual data manipulation or something like that. And they have to rely on spreadsheets because they don’t have any kind of software for it. So for instance, PM or estimating is a big example where the project managers don’t have any kind of estimating software. So they use tons of spreadsheets and then that forces everyone to kind of follow them. Another example is maybe they have two different systems that are disconnected.

So they have to pull data from one, do some kind of data manipulation in a spreadsheet, and then plug it back into their ERP. There are some cases where it makes sense to do that. Like if you’re doing any kind of what if scenario planning, you kind of want to pull that out of the ERP so we don’t do anything permanent. Because again, we’re just playing around with the numbers. But aside from that, if we have like actual workflows and stuff that are going on that should be happening in the ERP and stuff like that, usually it’s because, like I was saying, there’s just not any good software for it. So they have to use

Any kind of know spreadsheets because again, there’s no software for it And so usually in case like that the solution is to get everyone on a call and demo some software and say hey guys What do we think of this? know, is this a good one because we have to get some buy-in because if they’re like, whatever, you know We’re not I’m not gonna use that then we bought software for no reason So we to make sure everyone’s on the same page. They understand the value they they you know buy into using the software and then Usually if they understand the value and see how it be easier. They’ll go ahead and start using it

Rishi Srivastava (07:07)
All these construction ERPs, let’s say like Sage 300 they were built in like 80s. And the architecture is so old, the system’s very clunky, desktop based. There’s really, you cannot do any manipulation, data manipulation in there. You have to take it out and process it some way.

Gavin (07:23)
Mm-hmm.

Rishi Srivastava (07:23)
What are some telltale signs that a contractor has outgrown their current accounting or project management setup?

Gavin (07:31)
Usually it’s a lot of the signs we’ve already talked about where the accounting team feels like they’re drowning in paperwork. They’re super burned out. There’s too much stuff going on and leadership doesn’t get any visibility from the field side or project management side. They’ll also feel like there’s too much paperwork, but they usually feel like that, poking a little bit of fun at them. So usually for them, it might be something like reports, like any kind of WIP reports for the project managers or material purchases.

Those kind of things are perhaps taking too long. Slow payroll is another one. It’s a really big one. Usually it’s not something we see too often, but if payroll is slow, that either means that the company is in a super bad financial position or the ERP or whatever kind of software is not working very well and we’ve outgrown it. And so if you’re in that kind of position and you know that, the company is not going to go bankrupt, we know we’re in a pretty good financial position.

then usually just means that the accounting and HR staff are drowning in paperwork. The systems aren’t talking to each other, they’re not working and we have to go find something new.

Rishi Srivastava (08:25)
There’s so much transition of ERPs that needs to happen in next five years. A lot of these older ones, people are moving out of them because the new capabilities, cannot easily plug them in like in 80s architecture.

Gavin (08:38)
yeah, we’re seeing a lot of that too.

Rishi Srivastava (08:41)
Yeah.

The next section here, Gavin, is on integration and automation. When you are evaluating a company’s tech stack, how do you decide what should be automated versus what should stay manual for control or compliance reasons?

Gavin (08:55)
Usually what we do is we have some kind of a final approval checklist or something like that that goes on and so the actual manual data entry that is you know we try and get that as close to as automated as completely as possible but then a human has the final say over clicking the buttons on okay yes we’re gonna pay this person you know no we’re not gonna pay that person because accounting kind of touches basically

all the different ⁓ forms of money going in or out. And so in general, we don’t want to try and leave this completely up to some software because again, the software usually doesn’t have enough data to be able to completely do that. And if they do, know, AI is probably just going to replace all our jobs, but it doesn’t have enough data to do that. And so we usually want to have some kind of person in the driver’s seat that can approve or deny these requests essentially.

And so, know, anytime, anytime an invoice comes in, we want to make sure the person can make sure, yes, this is the correct invoice, this is going to the correct job, you know, and we’re good to pay this or, you time cards, we want make sure those are correct, all of that kind of stuff. So usually we try and automate the data entry and then the final approval and double checking and all that stuff. That’s where we have a person who we leave a person to do that job so that we can make sure that control and compliance is set in place.

Rishi Srivastava (10:04)
We at Beiing Human also focus on getting AP data into the ERPs. It’s such a tedious task for somebody to look at like thousands of – invoices and try to type it in an ERP.

Gavin (10:09)
Hmm.

Yeah.

Rishi Srivastava (10:16)
Can you share an example of how integrating two existing tools rather than replacing them created a big impact for a client?

Gavin (10:24)
Yeah, there’s a there’s quite a few of those actually. Usually they’ll have some kind of let’s say project management or a lot of times actually a specialty software. So one of our clients, they have a specialty software that’s for like estimating and CRM and they needed to move their ERP software to something different. But the old their old ERP integrated with their specialty estimating software, but their new one does not.

And so rather than replacing this other one completely, we can just go ahead and find some kind of integration. So what we basically did was we set up an import export workflow that kind of just automatically happens. And it works fine. And so it saves them a bunch of double entry and time like that. And there’s we have other clients who come to us who have systems that they bought that we’re supposed to talk to each other. It turns out they don’t. And so, again, that’s another thing where they kind of get used to using these things and we don’t want to.

completely replace them because that obviously causes a big drag on operations because now people have to relearn a software. And so we can just go ahead and replace the or integrate the two and in some kind of way. Like I said in the example, that one was basically a simple import export. So it doesn’t need to be this fancy thing that costs a bunch of money and is super time intensive and resource intensive. It can be a simple import export. But whenever we do that, we can save our people tons of relearning tool time and we can also reduce

the time it takes to move these things back and forth, would produce double entry errors, all that good stuff.

Rishi Srivastava (11:49)
How do you approach connecting ERPs like foundation, viewpoint, or Sage 300 to modern automation, platforms, or bolt-on apps?

Gavin (12:00)
Usually I like to take a very targeted approach. And so, you we want to make sure we’re actually solving the problem that we’re looking to solve as opposed to, you know, just buying software for the sake of software. And so what it starts with is we go ahead and we look at what our current software does and has and basically what, what functionality we’re missing. And what we do then is we go ahead and lay all this out on a big spreadsheet and we can say, okay, here’s what we have done. This part’s done.

and we can say these two softwares, maybe they don’t integrate or we’re missing this particular functionality, all that stuff. And so we can go through and then we basically start plugging away and we say, okay, which one’s the biggest problem? After that, we go and we find a couple of software that integrate with their ERP. And then we demo them all, make sure that they’re find the one that is a good fit for them. And then go ahead and implement it. So as an example, let’s say we have…

you know, AP is a problem or credit card transactions are a problem or payroll is a problem. And we can say AP is the biggest problem. We thousands of invoices. Well, in that case, let’s go look at some stuff that integrates with your ERP. And so let’s say we find beiing human, it’s a perfect fit. And we’re going to go ahead and just implement that one. And then we’ll go after that, we’ll go and look at payroll and credit cards and all the other problems. So I like to take a very targeted approach and let’s look at exactly what we’re missing as opposed to, you know, our entire

accounting needs to be automated and we’re missing all this stuff. If we can take a very targeted approach, it saves us a ton of time and money and we know what we’re doing and we can just, it also reduces overwhelm because we can just start going through and knocking a bunch of dominoes down.

Rishi Srivastava (13:30)
Yeah, AB noise and credit card receipt, do both, actually. We’re not in the business of issuing credit cards or issuing payments, but the data flow, the credit card receipt problem, we also solve for that. We just take a picture from a mobile app and the workflow for credit card receipt automation. The next section here, Gavin, is on ERP selection and implementation.

Gavin (13:50)
Go.

Rishi Srivastava (13:56)
For a contractor planning an ERP transition, what should they be thinking about before they start the implementation process?

Gavin (14:04)
I would highly recommend looking at the larger ecosystem that that ERP offers. And so some of them, they don’t have a very open, I guess like API or marketplace or anything like that. And so you basically have zero ability to bolt on any kind of, you know, extra accounting software to automate stuff. And so I would say before looking at anything else, I would look at, we know we’re probably ideally we’re going to grow. And that’s the reason that we are, are looking at an ERP, a newer ERP.

And so we want to find things that will help us grow and automate a bunch of stuff as well. So that, you know, again, we talked about earlier, there’s a huge kind of just accounting, construction, accounting shortage. There’s just not very many people understand it. And so the, ⁓ the further we can make our current staff go with our software, the better for everyone. And so

I would suggest looking at the ERP, making sure that they have these kind of bolt-on apps, this overall ecosystem that works really well for what you’re looking for, and then decide on which ERP of those, usually there’s a couple, Foundation, Sage, there’s a third one, but I’m blanking on it, but usually Foundation or Sage, are two good ones that have a big marketplace. And so anyway, you can look at one of those, make sure it fits for what you’re looking for, and…

Again, I just highly recommend looking at the overall ecosystem and what they offer there.

Rishi Srivastava (15:15)
Yeah, in this bolt on so important and if an ARP has like completely closed system. They’re to have a lot of problems in the ERP.

What are the most common mistakes you see during ERP Go Live and how can finance teams avoid them?

Gavin (15:32)
Usually the most common mistakes originate in implementation. And so if it’s implemented wrong or it’s built wrong and basically you have data going to the wrong areas in the ERP, it can cause an absolute mess in the database. And then it only gets worse as you add more data and continue on, you know, with your day-to-day operations. so I think it’s worth noting that a lot of implementers, they’re great, know, absolutely awesome at their job, but they don’t quite know your particular situation.

or what works best for your company. And so whenever they suggest things or give you a list of all the potential options or what they’ve seen work well in the past, I think it’s worth noting that you don’t necessarily have to take every single one of their suggestions or ideas because they don’t necessarily have to live with the consequences of their decisions, right? And so whenever they’re giving you all of these ⁓ ideas, it’s just kind of run them through your head or this can also be where it can be useful to hire people who have been there before.

either full-time or part-time, whatever, but if they know, if they’ve been there before, they’ve kind of seen the mistakes and stuff like that, then they can tell you, okay, here’s what we’ve actually seen work well in practice. But basically, you don’t necessarily have to take every single suggestion that your implementers say, because some of those can cause, like I saying, big data entry problems where data’s going to the wrong place. It’s overwhelming to do, and it just causes a big mess of the database.

Rishi Srivastava (16:48)
Definitely. How can CFOs ensure their ERP and automation decisions are actually driving financial clarity and not just adding tech complexity?

Gavin (17:00)
Yeah, so like we talked about earlier, we kind of want to make sure there’s a problem to solve. And so I would highly recommend looking at either a very particular set of features that you’re looking for in a software or a step-by-step process that you already do that you’re trying to replace. And so, for instance, instead of saying some kind of very large, amorphous, overarching statement of saying, I want my materials to be improved, you dig down to the problem. So maybe we find out that actually we don’t necessarily need an entirely new materials platform.

It’s not materials in general. It’s actually just that our field team, whenever they have materials they’d like to request, they don’t have a very convenient place to do that. So they send it in wherever they can. So we get stuff that comes in through email, text, Slack, etc. because it’s not in a very easy place to look at, they might send in the same request two or three times. And so we have to then go through all of these things. We have to go through each of these different channels.

double check that, is this the same materials request or do they really need this twice? And so that can cause a lot of problems. And so if we can narrow it down to instead of saying, okay, we need material stuff in general, we actually just need a field app that allows them to send a materials request really easily. That’s all in one place. That could actually be a feature add-on of a current field app that the company is using. And we can just go ahead and turn that thing on. And we’ve solved the problem or going back to…

of beiing human, if beiing human, turns out has a credit card transaction recorder that we didn’t even know it had, we don’t need to go get a new credit card software possibly, we could just try and see if we can just go ahead and use beiing human’s credit card transaction solution. that way we’ve solved it, we again, try and narrow it down to where we have the exact set of problems or step by step thing that we are looking to do and then we can solve it in the simplest, easiest way possible as opposed to adding a bunch of software.

Rishi Srivastava (18:41)
Yeah, and if you don’t go with a set of requirements, it gets very hard to get any software. You have to know what problem you’re solving for. I love that quote from you.

The next section Gavin here is on financial clarity and process control. Where do you draw the line with automation in construction accounting? What are examples of processes that should not be fully automated?

Gavin (19:04)
Usually, I draw the line with basically anything where some kind of software or AI system or anything like that doesn’t have complete data on. And so usually that’s anything related to payroll or things that the field is doing. You know, so for instance, let’s go with time cards. Any kind of software doesn’t necessarily know what job the person is on or what cost code they are tracking their time to. And so we have to have the person that enters that paperwork.

Unfortunately, but it has to kind of get done because the software just basically doesn’t exist in the real world And so it doesn’t have any kind of data collection. So until we have something where you know either You know, maybe we have some kind of like AR glasses that can say, okay Here’s the Cost code that they’re working on at this particular time. It can save everyone a ton of paperwork We have to have some person that’s entering it and so We can try and make time cards and paperwork and all that stuff easier with the right software or system or tools But it’s very hard to completely replace it

because the systems, like I was saying, just don’t quite know what they were doing in the real world. And so we have to have someone actually entering the paperwork. Everything else that’s not necessarily like super time-carved, you know, real-world, I guess, driven, we can try and get completely automated or as close to that as possible. But basically anything where like people are, like I was saying, clocking time to particular things or cost codes, that’s really hard for AI systems to know, and thus it’s really hard for us to completely automate it.

Rishi Srivastava (20:23)
Voice can be a good tool, too, but the voice models are actually not there to help people get the data in the field people and not use the voice AI just said because the models are just not yet there. You cannot say, hey, I work on a foundation for this particular building for three hours, and the AI is just going to transcribe and write it.

Gavin (20:42)
Yeah, I think there’s a lot of stuff like that where it’s just, there’s too many steps for the field people to have to complete and then they either won’t do it or they maybe mess it up and forget something. And so the simpler we can make it, like you were saying with the voice model, the simpler it can be, the better for everyone.

Rishi Srivastava (20:57)
Actually, Da Vinci said simplicity is the ultimate sophistication.

Gavin (21:02)
yeah, yes I agree with that.

Rishi Srivastava (21:03)
How do automation and integrations help improve job cost accuracy or forecasting confidence for project-driven businesses like construction?

Gavin (21:12)
They tend to do this ⁓ a couple different ways. So number one is they reduce the risk of inaccuracies. They keep everything up to date and then they can allow forecasting to get.

done faster. And so from the inaccuracy standpoint, let’s go back to our double entry problem where you have two different softwares that don’t talk to each other. If we can integrate that, then all of a we’ve reduced the risk of double entry because there’s not a person who has to go enter it over here and then they have to go reenter it over here. Whenever they have to do that, there’s a risk they hit the wrong button and our data shows up wrong in one place. And then, you know, we don’t maybe know which one’s the right one or we have to go do some more digging. Either way, that slows down forecasting or

you makes it inaccurate. Another thing it does is it adds, I’d say guardrails. So if you have any kind of automation, you know, the automation or bolt-on software usually only lets you put it into one area. And so it’s not like, say, a journal entry where someone could just go in there and make a journal entry to wherever they want. ⁓ The software makes this particular, let’s just say invoice or whatever, go to a very particular place. And it also can add kind of like a double checking ⁓ function where it’s

let’s say reading the invoice and then pulling all the data from it. And so then again, there’s two sets of eyes on it. And so it can reduce inaccuracies in that sense. The up to date part and allowing forecasting to happen faster is we can reduce the time it takes us to do all of this stuff. And then obviously that keeps everything up to date because well, we’re doing it quicker. The team’s not getting bogged down in all this work. And it also allows forecasting to happen faster because again, we have

all the data in one place, we’re not having to go get it. So there’s a lot of stories that I’ve heard of teams that have to go and collect all of their data at the time that they need to go do their particular forecasting. And so they need to go to basically every single team and get all the data they need to do. ⁓ Whenever we have it all in one place, it happens so much quicker. It’s accurate, it’s up to date, ⁓ all that good stuff. And so that’s how automation integration can help with all of that stuff.

Rishi Srivastava (23:04)
The data accuracy is so important. A lot of these companies, especially the ones that are not using automation, their data itself is garbage because they don’t have all the controls in place.

Gavin (23:16)
Yep.

Rishi Srivastava (23:16)
The last section here Gavin’s on the future of construction finance tech. Looking ahead, where do you think construction finance teams will see the biggest productivity gains in AP automation, forecasting, payroll, or somewhere else?

Gavin (23:32)
I think it really depends on the construction company because some of might have you know a wonderful AP system where they have you know beiing human And you know their AP is essentially taken care of but maybe their payroll is a mess or vice versa And so a lot of times I really do think it depends on the particular company Most of the productivity gains we’re seeing right now are basically in any kind of manual data entry

you know, AP, credit cards, bill pay, payroll, all that stuff. That’s where the day-to-day work is. And that’s kind of the foundation for everything else. Because if we don’t have our data entered, if it’s not accurate, then we can’t really do forecasting from that. So, you know, that’s kind of the foundation of what we’re looking to really automate is any kind of data entry. But in terms of which one of those pieces makes the biggest difference, I really think it depends on the particular construction company.

Rishi Srivastava (24:17)
companies have payroll as their bigger problem, or maybe AR is a big problem. So the last question here, Gavin, is

What advice would you give a controller or CFO who wants to start improving their systems but feels overwhelmed by the number of tools and options out there?

Gavin (24:36)
Yeah, I would say there’s like a two or three step process you can do to go ahead and narrow a lot of that and reduce that overwhelm. So number one is we’re going to plot out all the processes and systems that you currently use and then let’s look at what actually needs automation. so basically we want to just go ahead and do this on spreadsheet. If you don’t mind, Rishi, I’ll go ahead and throw a quick plug in. If you go to atlascfo.com forward slash automate, there’s a tool we’ve made. called the one hour contractor tech plan.

but basically it helps you go ahead and fill out all that stuff and see where you’re actually missing your automations and processes and stuff like that. So anyway, once you have that all plotted out, we then just want to say, okay, let’s pick the biggest bottleneck right now. So, you know, maybe it’s AP, maybe it is time cards, maybe payroll, right? Whatever that is, let’s pick the biggest bottleneck and then let’s go look at the options that only integrate with our ERP. And so if we don’t look at any of this, it’s super easy to have a list of, you know, 120. I think I have ⁓ probably a

bunch of bookmarks of every single construction automation tool out there. I think it’s probably 120 of them right now. There’s quite a bit that you can use. But whenever we narrow it down to, we’re going to actually look at AP only right now. And then we’re only going to look at the ones that integrate with our particular ERP. That usually brings down to, you know, three to five, maybe even less tools that you can actually look at. And so that reduces overwhelm a ton. Instead of that 120 that I tend to look at, we actually only have three to five that we’re looking at.

And so then we just go ahead and say, okay, which one’s best for us? And we pick it and then we can repeat that for the next process. But I mean, that’s it. That reduces overwhelm a whole bunch. makes things super easy. yeah, I mean, like I’m saying, you can go from 123 to five and then just go ahead and repeat that.

Rishi Srivastava (26:13)
Yeah, it’s just too many options if you’re not narrowing it properly.

Gavin, thank you so much for coming on to the show. I had a great conversation with you.

Gavin (26:21)
Yeah, thanks for having me, Rishi.