As we look ahead to 2020 and beyond, one thing is clear: The construction industry will continue to see high levels of growth. In fact, analysts at Global Construction Perspectives and Oxford Economics predict that by 2025, the construction industry will have grown by 70% to $15 trillion.
An even more amazing statistic is that, according to the World Economic Forum, 75% of the infrastructure that will exist in 2050 doesn’t exist today.
With so much potential for growth, it’s an exciting time for the industry. However, two significant challenges stand in the way of this growth. First, construction projects are getting more complex. They’re bigger, taller and expected to be more efficient than ever before. In addition, the industry continues to face a lack of skilled workers.
The good news is that construction firms can navigate this risky environment of more complex projects and less-experienced workers, and the key to doing that is technology.
Innovators are adopting new business models and proven industrial processes and technologies without a painful learning curve. Similar to the way that emerging nations skipped landline telephones and went directly to cellular, many construction companies will jump directly from outdated methods and tools to the most innovative solutions. This inflection point, known as “the industrialization of construction,” is expected to lead to dramatic improvements in productivity across the industry.
Technologies like drones, lasers, artificial intelligence (AI) and machine learning may sound far off, but some firms are using them now. If technology is already a big part of your construction business, these are additions you should consider investing in soon.
Drone use on construction sites continues to increase, as the data gleaned is helping firms with everything from improving communication and keeping projects on track, to increasing safety and streamlining the bidding process. Laser technology helps construction teams accurately, safely and efficiently take site measurements.
Meanwhile, AI and machine learning enable computer systems to “learn” from the mass amounts of data gathered to make the jobsite more efficient. As AI becomes more widely adopted, it will help address issues plaguing the industry, such as labor shortages, cost overruns and on-the-job accidents.
The Power of Choice
Not all firms are ready to dive right into AI, but wherever you fall on the spectrum, technology can help. When it comes to software solutions, the “best-of-breed” label is back due to advances in the interoperability of technology and the depth of point solutions. There are now point solutions tailored to very specific activities or sections of work, and they are becoming increasingly niche as technology is getting more robust and mature in each specialized area.
This plethora of solutions addressing a wide range of business issues gives construction firms the power of choice. You can find the right technology for the right problem, which often involves a mix of solutions since today’s contractor isn’t forced to settle with one solution that attempts to do everything.
You can use one solution for accounting, and add another for project management and another for estimating. Many technology vendors are adapting to this shifting software landscape by making it easy for their solutions to integrate with one another.
Investing in Preconstruction
The surfeit options can seem overwhelming, especially to construction firms that have been slower to adopt to new technologies. For those who are unsure where to start, preconstruction is a great place to begin investing in technology.
The industry has seen greater adoption of building information modeling (BIM) in recent years. It’s no longer being used just for large, highly complex projects—projects and companies of all sizes are recognizing the value of BIM as a sales tool. Take, for example, a smaller project like a kitchen remodel, where one contractor submits a 2D sketch while another submits a full 3D rendering of what the finished kitchen will look like.
The contractor who produces the full 3D rendering will have an advantage when it comes to winning the job and will also have the tools needed to better execute the project, helping them to deliver on time and within budget.
Data Is the New Oil
Data is a precious resource, playing a crucial role in helping construction companies learn from past mistakes and improve upon their performance in the future. Luckily, even the smallest firms have data, harnessed from sources such as financial statements, business reports, emails, plan revisions, conversations, documents and change orders.
In addition to past indicators, monitoring the current state of projects ensures you’re alerted to any potential issues before it’s too late and helps you keep a handle on whether or not you have enough cash coming in, enough work planned out and a productive labor force.
Best-in-class contractors use a series of key performance indicators (KPIs) to measure, monitor and manage performance. These KPIs can be used as yardsticks to help you evaluate how things are going, spot red flags and act decisively.
Data sifting is another area where you can easily begin implementing technology. Most firms have an overwhelming amount of data, but the right technology can help you find, filter and focus on the information that matters most.
Three types of technology to consider investing in are interoperable software tools, an automated alert system and an effective dashboard tool. An integrated construction software solution supports and automates critical, industry-specific functions and allows you to easily mine consistent data, which in turn allows for timely measurement against KPIs and more rapid, accurate completion of key business processes.
An automated alert system actively monitors the data housed in software and filters high quantities of information to keep you updated on what’s most important. It also provides immediate notification when something requires attention. An effective dashboard presents information clearly, quickly and compellingly, providing you with easier, more intuitive access to project and accounting details.
For those who are still unsure if investing in new technology is the right move for your business, there are additional ways you can dip your toes into the water, so to speak. Myriad free apps are available that provide simple business solutions and are a great way to introduce technology into your construction business.
You can consider starting with an app that enables file sharing and collaboration, such as Dropbox or Google Drive, to help keep project teams on the same page. Or perhaps an app that tracks mileage, such as MileIQ, or an app that keeps track of receipts, such as Expensify, would be a better fit for your business. There is an app for just about any need, and most people are already using an array of apps in their personal lives. This makes it easier for you and your crew to quickly adopt similar apps on the jobsite.
Begin embracing technology anywhere and everywhere you can. Making small changes and incorporating an app or two where it makes the most sense will help you feel more comfortable using technology as an everyday part of your business. And once you start seeing the benefits, it will be easier to begin adding additional technologies as you see fit.
The construction industry is growing, and the role technology will play in this development cannot be understated. So, whether you’re all in or just getting started, now’s the time to step outside of your comfort zone and incorporate new technology into your construction business.