It's time to seriously consider upgrading your project management toolbox if you're seeing some of these signals:

• Project managers spend more time "fixing up" and recording project details than managing the project.
• Staff spends a lot of time re-entering data from multiple tools and losing important records.
• Your administrative staff grows faster than the rest of your organization, but never quite catches up with the   documentation.
• You're missing deadlines and getting a lot of surprises on the job site: Materials aren't ordered for the appropriate   time, subcontractors show up when not needed, important milestones aren't communicated properly to the right   people.
• Project managers constantly complain of overwork, but no matter how many you hire, the problem doesn't seem to go   away.
• Staff turnover increases and customers seem increasingly unhappy.

Choosing a project management solution for your business is a high-stakes game: The right solution provides huge ROI, especially time and cost savings, and positions your company for growth. The wrong solution can waste time and money and lead to inefficiencies that actually make project management harder and increase your business risk.

Before you start your search, take the time to sit down with your project managers, IT staff (if you have them) and corporate leadership to hammer out the following four requirements:

1. What are your end goals?

Do you want to be able to collaborate electronically, with internal staff as well as outside suppliers and contactors? Are you simply concerned with more accurate project scheduling or does your management want more visibility into performance metrics?

Survey your employees and management team and make a list of current inefficiencies. Where are the main pain points? Where is your competition outperforming your company? Do they have capabilities, such as better on-time delivery, which you lack? Are they constantly underbidding you on key projects?

These are all areas where project management can help, and form an excellent starting place for project management investigation.

2. What's your IT/software strategy?

An application can do exactly what you want and still be the wrong choice if it doesn't play nicely with your other software. The ability to pass data between applications is an important consideration in choosing project management software.

"Data integration keeps you from retyping the same data into your applications over and over again. Without it, you could spend $1,000 in paperwork and data entry on a $50 change order that takes days or weeks to log," said consultant David Brown of D. Brown Management  in Lodi, Calif.

There is no industry-wide data exchange standard such as XML, which makes it difficult to ensure that project data passes easily between accounting, estimating, scheduling, and other critical construction management applications. Almost every vendor will claim that its project management software will integrate with your accounting system, but beware: simple check boxes on feature lists can hide a wide range of levels of interoperability.

In addition, you have to think about data coming in from subcontractors and other companies whose data format may be out of your control. "Even if you fully integrate your own applications, so that the data is passed from one application to another within your company, chances are your subs won't have the same software, and so somewhere along the line you'll be re-entering data" said Brown.

It's important to understand how you want this system to talk to your other software systems as well as your partners' and subcontractors' systems.

3. What are you willing to invest in the project?

In general, you should consider more than the price of the software and the associated costs of implementation and training. Is your hardware up to the task? Will you need to upgrade existing software to support it? Will your remote staff need mobile access to the data to ensure accurate, timely input?

Make sure you consider the costs of the entire system, not just this isolated piece.

4. Should you bring in outside experts?

"It's hard to know what comes next if you haven't been there before," said Brown. For many contractors, project management software is uncharted territory, so unless you have in-house staff experienced in selection, installation and training for project management systems, you should seek out knowledgeable people in the field.

If you decide to enlist outside help, don't rely on a consultant or reseller who only deals with one software package. Talk to a variety of consultants, emphasizing your list of end goals and your IT software strategy. Make sure the consultant understands your objectives and isn't just trying to make a "one-size-fits-all" package work for your company.

In project management software there is no "perfect" solution. "It's a trade-off between integration and best-of-breed," said Brown. "The problem with best-of-breed is that it may do one thing well, but it might not talk to your other software." That may not be as important for a small company, where only one or two projects are managed at a time, but it can be critical for companies managing dozens or hundreds of huge projects with lots of subcontractors and suppliers. Generally, the more projects you handle simultaneously, the more you'll value systems that maximize integration.

*** Go to the next article: Construction Project Management and Scheduling Software Buyer's Guide: Benefits