Hagler Systems worked with Sikich to create a project statement dashboard built with Microsoft Power BI using their data from Dynamics 365 for Finance and Supply Chain Management. The effort succeeded beyond the initial goals. The dashboard not only delivers the real-time financial information executives, sales teams, and account managers need, but also helps the company mitigate project risks and evolve its culture of accountability.
At Hagler Systems, technology has for many years helped bring transparency and control to business management. “Our ERP software helped us foster more data-driven business management,” says John Leibach, Chief Financial Officer at Hagler Systems. “The latest business intelligence effort, which Sikich helped us with, has resulted in an amazing dashboard that helps us improve accountability and profitability. Our project managers want to use it as their main financial tool.”
For industrial and public-sector clients around the globe, Hagler Systems provides engineering consulting, manufacturing, and project delivery of complex, custom-built systems that meet unique challenges. If business requirements call for the engineering and manufacturing, for example, of a dredge, modular barge, hydraulic power unit, or special-purpose steel building, Hagler Systems applies its technical, industry, and project management expertise to deliver the right solution. Hagler Systems is a pure engineer-to-order (ETO) business, and whatever the company engineers and produces for its clients is a unique project. At any time, 30 or more projects are underway, including complex solutions that have long lead times and generate revenue of many millions of dollars.
Hagler Systems is a long-time Sikich client, implementing Microsoft Dynamics AX years ago and modernizing its ERP environment with Microsoft Dynamics 365 Finance and Supply Chain in the cloud when many businesses were still hesitant to adopt cloud platforms. In Dynamics 365, Hagler Systems manages project-based manufacturing, project accounting, inventory, procurement, and other core business processes.
For Hagler Systems’ project managers, it’s critical to be aware of the financial performance of the projects in their portfolio. Providing them with that information required a member of the finance team to extract data from several modules of Dynamics 365 into an Excel spreadsheet, process and format it, and share it in a reporting template. This was a laborious effort which required hours of time. Errors could easily creep in, and only a small subset of the company’s projects could be included on one day. Cecily Perez, Cost Accountant at Hagler Systems, says, “Project managers needed to see their project statements with the most current data and more frequently than we were able to provide.”
A practical, useful project statement would have to provide answers to several important questions:
The Hagler Systems finance team created a detailed, conceptual model of the ERP data points a project statement needed to include. Then they engaged Sikich to help create the reporting and visualization tool. The Sikich consultants felt that it was best to create the new reporting vehicle with Microsoft Power BI and assigned a reporting and analytics expert to work with Hagler Systems. “The Sikich consultant was very helpful in showing us how to transfer the source data from Dynamics 365 into an Azure Data Lake and from there export it into tables that would feed into our project statement,” says Perez. “He demonstrated several options for accomplishing this, made recommendations, and let us decide how we wanted to proceed. In this process, I learned how to work with Power BI to display data as we want to see it.”
The resulting project statement report is available to the finance team, executives, sales, and project managers on a SharePoint site. Through a stable integration, it refreshes automatically once a day, and finance and project managers can get an update whenever they need to. For all Hagler Systems projects, today’s project statement offers incurred and future costs, cash flow updates, labor costs by department, expenses for materials, and more in an intuitive, graphical presentation.
In addition to meeting the critical information needs that initially drove the Power BI effort, the project statement provides current, complete details regarding, for instance, items received, delivery dates, customer commitments, and invoice payments. One area of the dashboard screen highlights expected project revenue, committed future costs, and margins. “We now have the supporting documentation to ensure timely customer payments,” notes Leibach. “In that way, the project statement has become a helpful enforcement tool.”
Many inquiries regarding the status of these aspects of projects are no longer necessary. Instead, project managers and account executives can enter a project number and immediately see for themselves. Perez describes, “When project managers talk to customers, they can access the project statement and quickly verify whether a certain invoice has been paid or is still due. We also know where we stand with our vendors in regards to delivery dates and our obligations. From a one-page lookup service, the project statement has quickly become a comprehensive management tool for project and sales teams.”
The project statement reporting project has positive impacts far beyond the finance team’s initial plans. Leibach explains, “Our Power BI undertaking is changing how Hagler Systems manages its business. Now, you can review all active projects in an hour, when previously we were not able to do more than provide information about one or two projects per day.”
With that increased transparency, it has become easier to mitigate project-related risks. Without the proper attention, Hagler Systems projects can quickly turn negative in terms of cash flow. Even large, lengthy projects that will generate huge amounts of revenue can compromise the company’s financial performance if their cash flow lags. Hagler Systems always relied on finance managers to alert sales and project managers to such project liabilities, but, without realtime data, the team was often able to draw attention to cash flow reversals only after the fact, not as soon as they happened.
Today, with immediate visibility bolstered by the evidence of five years of historical ERP data available to Power BI, the company can address financial project risks differently. “We’re developing a culture of accountability,” comments Leibach. “We can now have an early peer review before we accept projects, instead of the more risky practice of leaving it to individual sales executives to set up project financials and committing to them with customers.”
Given the enhanced visibility of project details, engineers and other Hagler Systems employees have become greatly more diligent in recording the time they spend on projects. “We have gained both accuracy and convenience in our information recording and reporting,” Leibach adds. “We no longer operate in silos. I find it very healthy that associates in sales and project management can collegially challenge each other.”
In addition to working with her team and stakeholders to refine the project statement dashboard report. Perez is planning additional reports that she will create in Power BI. One of these will focus on project budgeting, allowing business managers to assess how closely project milestones and events align with the project budgets established in the beginning. That will also make it possible to highlight discrepancies, for example, between vendors’ quotes and their eventual charges.
Another Power BI report in preparation will bring greater visibility to Hagler Systems’ spare parts business, which accounts for a significant portion of the company’s revenue. Leibach says, “Many of our customers have never engaged with us on engineer-to-order production, but they are great contributors to our bottom line because they always buy replacement parts for their industrial equipment. With the right reporting, we can direct more attention to that part of the business and help account executives get in front of these customers more often.”
Thoughtful preparation made a big difference in the success of Hagler Systems’ BI-enhanced project statement. To finance and project managers considering a similar effort, Perez recommends, “Map out your reporting structure in detail and fully document which information you need to glean from which modules in Dynamics 365. That will make it much easier to create the dashboard or report you need.” It’s also important to involve the right associates who understand the details of financials and business processes. “The better prepared you are, the better your Power BI project will go,” Perez adds.
For Hagler Systems’ initial foray into advanced reporting with Power BI, collaborating with an experienced technology partner was also a success factor. “We have enjoyed working with Sikich over many years, and I knew they would get the job done,” Leibach comments. “Still, I knew this was not an easy task, because it involved a compilation of multiple data sets from many Dynamics 365 modules. We greatly appreciated the patience and perseverance of our resourceful Sikich consultant, who was always available to work with us and keep the project on track.”
