The Value of Integrating Enterprise CRM with Financial Planning for GovCon

Leverage the strategic advantages of integrating Enterprise CRM with financial planning in GovCon. Discover effective forecasting and bidding for thriving govcon success.

When GovCon organizations pursue and bid on federal contracts, a critical step of the process is financial analysis. Effective forecasting, budgeting, and cost management are crucial to rating opportunities, pricing proposals, and executing contracts. You need to ensure you’re thinking through each opportunity from a short-term profitability perspective, in addition to a sustainable, long-term growth perspective. You also need to align your financial practices with regulations and restrictions to avoid compliance issues that could jeopardize your eligibility for future contracts. 

To do this successfully, teams across functions — finance, business development, project managers, and others — have to work together to share information during the bidding process. However, it can be incredibly difficult to find tools that can track and house the conversations and discussions that happen between all of these stakeholders across multiple projects and customers. An enterprise CRM that is built specifically for the financial, collaborative, and process needs of government contractors helps keep everyone aligned and on the same page. 

With a GovCon CRM under your belt, your team can collect the input, knowledge, and updated customer data required to optimize proposal strategies, estimate costs, negotiate contracts, and win more opportunities — ultimately providing the insight you need to accurately forecast your future growth, budgets, and profitability.

Developing predictable financial forecasts and cost estimates

Financial forecasting is key to long-term growth and revenue generation, so greater predictability in the process is always the goal. Having a predictable sales forecast over a two- to five-year time period helps you structure each of your proposals as competitively as possible.

Cost estimation and past performance as an indicator of future performance are two related areas in which predictable forecasting factors in. To thoroughly and accurately estimate direct and indirect costs, you need to know the costs of past projects that were similar in nature and scope, as well as costs at the per-item or task level of the specific project you’re bidding on. This helps you forecast what the total cost of the project will be for your organization. 

It’s important to note that conducting a past performance analysis isn’t just confined to knowing how your organization fared with any single, previous contract, but can also include analyzing past costs from a broader period of time. With a detailed cost estimate in hand and insight into how your competitors are positioned, you can begin to lay the groundwork for a winning proposal. 

Competitive proposal pricing and profitability are especially important when it comes to price adjustments. Suppose the contract doesn’t allow for economic price adjustments mid-stream based on the changing costs of materials and labor. In that case, the original proposal must be priced well enough that your organization won’t take a financial hit. 

Armed with this information upfront, your finance team can help ensure that bids aren’t just priced to win, but that if your organization is awarded the contract, you won’t lose revenue, even if market fluctuations or contract changes occur.

Accessing any information that can help your finance team build out a fuller financial picture is critical — and this can be accomplished with the right CRM.

The role of enterprise CRM in financial forecasting  

So, practically speaking, what can a CRM actually do for your finance team?

First, an enterprise CRM purpose-built for GovCon contains detailed, up-to-date information about government buyers and markets. This includes: 

  • Extensive market intelligence, leads, and opportunities
  • Which phase of the sales process any particular customer is in
  • Customer preferences and behaviors

Integration with an enterprise ERP for GovCon can also deliver insights on customer payment histories, billing cycles and invoicing, and more. 

With this information, your finance team gains important insights and data they can then leverage to:

  • Get a clear understanding of the pipeline — including proposals in process and active projects — and resource deployment
  • Help assess, from a profitability perspective, which opportunities to bid on and which contracts are likely to generate the most revenue
  • Understand and compare competitor capabilities and their pricing
  • Build an accurate sales forecast for budget planning
  • Help structure proposals accordingly based on the type of contract
  • Adjust wrap rates — including direct labor, fringe, overhead, and general and administrative (G&A) costs — and ensure that indirect costs meet stringent government regulations for what’s allowed in a bid without losing the company money
  • Make forecast shifts and adjustments as opportunities move through the funnel and win probabilities change
  • Manage capital and cash flow to ensure more cash is flowing into the organization than is going out in the form of expenses
  • Identify payment or credit risks of current or potential buyers
  • Track metrics like bid-to-win ratio, bid-to-loss ratio, length of the sales process, phase statistics, revenue targets, rate analysis by year, forecast comparisons, and pipeline snapshots 

Bringing teams together in the CRM to secure contracts

A well-integrated CRM operates as a hub for gathering the contributions — rates, estimates, budgets, and more — from a diverse group of stakeholders and making the data accessible to everyone to ensure thorough input, smart decision-making, and financial viability

The secret superpower of Project Managers 

Another key group involved is project managers. As the team that is closest to the customer, it’s imperative for them to be able to update the CRM with customer and project data in real time. This is especially important for follow-on contracts when the next phase of the project is contracted separately, since the project manager will already have firsthand experience with the government buyer and how the initial project phases performed. It’s also important if there are any major modifications to an existing contract. In addition, throughout conversations with the customer, the PM or professional doing the work will hear interesting information about what might show up in the next contract or what other contracts might be coming soon. This helps the growth team plan and prepare ahead of time to build a competitive edge.

As we’ve shown, customer and project information are valuable to your finance team, but also to every other team involved throughout the lifecycle of a government contract. When each team is able to provide, update, and access information in the CRM before and after a contract is won, you’re able to create a closed loop of information that cycles between teams and phases — whether you’re researching opportunities, answering a request for proposal (RFP), submitting a proposal, or executing a contract. 

In an enterprise ecosystem in which information silos are all too common, utilizing the CRM as a one-stop source for information eliminates this problem. With the right CRM, no stakeholder is locked out of the data they need and the quality of shared information is always high. You can make sure that every proposal created and submitted is a superior one.With an integrated CRM, all teams and functions are able to inform and support each other, as everyone works toward winning the best, most profitable contracts. 

To learn more about how an enterprise CRM like Unanet, purpose-built for GovCon, can improve proposals, contracts, and financial forecasts, download our eBook, GovCon Growth Playbook