By Paul Skurpski, PVBS Vice President of Sales & Marketing
Many government contractors we deal with are looking for ways to keep their back office cost structure in check, either as they grow or stabilize. With sequestration and the recent shutdown, it’s even more imperative to keep costs in check when growth is not happening or temporarily stalled.
Our government contractor clients ask us how Microsoft Dynamics NAV for Government Contractors can help them overcome the new challenges they face. In the past it’s always been about how the software supports their growth. Frequently now, though, it’s “how do I find ways to be more efficient and leaner so I can bring my rates down and compete and win in this new environment?” Two immediate ways the investment in Microsoft Dynamics NAV helps keep costs down are with:
1. The lower back office costs typically associated with NAV
2. A flexible license model.
Many government contractors who have moved to Dynamics NAV have found that the cost to maintain and support their business software can be significantly reduced from what they might have had in the past. With the government now being slower to award new contracts, we have clients and prospects that have to consider reducing their workforce when business plateaus or slows. Typically, though, they don’t want to reduce their back office staff because they need operational continuity when they start winning awards as their BD efforts bear fruit or as the customer looks for more services.
NAV for Government Contractors was built to automate critical government contracting functions such as report generation, invoice creation, accounting and financial management. Functions, such as generating timely reports for the executive suite and program managers, can be accomplished in minutes rather than days or weeks. The burden on the back office team to support the business function is eased with the automated and streamlined capabilities the software solution brings them.
Another factor that has received a large degree of favor with companies that are stabilizing is found in the Microsoft Dynamics NAV license model.
Many of our new clients have found that the cost to acquire, implement, and maintain Dynamics NAV is significantly less than what they expect to pay in maintenance alone for their legacy software! This happens by leveraging finance options to spread the purchase and implementation costs over a longer period of time which helps with cash flow during slow times. We can help the company’s net positive cash flow month over month by implementing a new system, because the cost structure is that much different, compared to what’s been historically available to them from legacy software vendors.
For example, let’s take a growing company that has gone from 150 to 300 employees, which means there is much more direct labor to support in more G&A costs and overhead costs. If you can boost your direct labor but not impact your back office, both from a staffing perspective and from a software and maintenance perspective, that’s a big deal. This is a real world example. We have a client that went from 150 to 300 people that did not incur any additional software costs. They were already pretty lean, but they didn’t have to add any staff nor buy any additional software when the new employees came on board. This made them even more competitive. Now they’re a larger organization, but with the same back office cost structure. To get even more competitive, they now have some flexibility to bid more aggressive rates.
NAV also brings a client-friendly license model that does not penalize you for additional time sheet and expense (T&E) users. Unfortunately, many legacy software license models penalize their users by having additional license fees for T&E users. That is not the case with Dynamics NAV.