Established in 1950, Electract Limited is an electrical engineering expert for all types of electrical building services. The company has a turnover of around £16 million, with contract values ranging from £2,000 to more than £2 million. It employs 120 fully trained electrical engineers, plus office engineering and administrative staff.The challenge
Before signing up with RedSky in 2011, Electract was using a generic accounting system. Finance Director Richard Malpas said: “We were finding lots of ‘holes’ in it from a construction industry viewpoint.
“For example, it wasn’t designed to deal with concepts like retentions or applications, so every time we tried to look at a job, we had to rely on a myriad of spreadsheets to fill in the missing information and try to control things. The package only had the core accounts. It wasn’t giving us the complete picture and we were always running a couple of months behind.”
The existing system was also proving very labour intensive, involving a significant amount of manual data entry and repetition.
Having reviewed many different systems, it was the comprehensive nature of RedSky’s Summit package that impressed Richard the most, as well as the fact that it was designed specifically for the construction industry.
Summit has made a huge difference to Electract’s purchase ledger. “We’ve gone from a situation where invoices weren’t going on the system until after they’d been approved to one where invoices are going on the system straight away and then awaiting approval,” said Richard. “That has given us immediate visibility of all the invoices that are out there.”
Richard can now analyse jobs in far greater detail than before, accessing real-time information: “If we want to look at a housing contract that’s not performing as well as expected, we can drill down to look at it by plot level, and then examine if the problem’s to do with the first, second or third fix.
“Drilling down means we can work out the root cause of the problem far more quickly than we could ever have done before – that’s because everything’s broken down into manageable chunks and we have sight of all of them.”
Designed specifically for the construction sector, Summit ‘understands’ the concept of subcontractors. It has a specific ledger, so Electract now runs all the Construction Industry Scheme (CIS) details automatically within the system, rather than keying them all in manually each time. It’s been a big time-saver and has proved very useful from a reporting point of view.
It’s a similar story with retentions. “Retention information is instantly visible by job and by customer,” said Richard. “We now use the system’s document management system (DMS) to flag up the dates when we need to start chasing.”
Being able to retrieve information in a format that he can manipulate with ease has made Richard’s life far easier. The quarterly financial accounts are a good example: “I’ve now got an Excel spreadsheet that delves into the RedSky system and produces the figures for me. So I just go to the spreadsheet, change the period I want to report on and it automatically produces a set of accounts.”
Electract now uses Summit to send out payslips and P60s using fully encrypted emails, rather than posting them out. Richard said: “Obviously we’ve had to purchase the module from RedSky, but we’ve worked out that it’ll have paid for itself within the first year.”
“I am really impressed with Summit,” said Richard. “It’s an incredibly comprehensive system. It has the flexibility to pull out data in any format you want, so you can adapt it to the way you want to work. Going with RedSky was an excellent decision. It has fundamentally changed a lot of the ways we work for the better.”
He added: “Summit really adds value and definitely pays for itself, many times over. It’s made a very big impact on our overall performance.”