How can digital tools drive cost control for the construction sector?
The cost landscape in construction
It is no secret that managing margins for large scale construction projects is a challenge. The competitive tendering landscape combined with increasing construction costs presents a huge challenge for management teams. While there are many factors that affect the bottom line, the increasing complexity of projects are a key element.
Builds are now larger and more dynamic, so managing these with solely manual paper-based processes gives limited or no visibility of outgoings. Higher compliance standards create significant workload, adding to inefficiencies for management teams that operate manually. These factors create the potential for significant cost overruns and long-term losses for companies that are slow to adopt technology.
Like many other industries the pressure for better cost management has been multiplied by the current Covid Crisis, which has seen prompted leading companies to adopt tech solutions at historical rates. Those that get it right have placed themselves in a strong position to not only survive but captalise on weaker and less efficient competitors. Others that are late to adopt will not be so lucky. So what are the benefits of adopting tech and how will they impact cost control moving forward?
Complete visibility of contractor time on sites
As soon as a project has any scale or complexity, visibility of contractor cost becomes more difficult. This easily results in surprise cost blowouts – you often do not know until well after the fact and beyond any opportunity for control. This is compounded during periods when physical distancing is mandatory.
Contactless sign-in solutions are being used to combat this issue. Whilst initially intended to only simplify check-in, these technologies also offer an automated and accurate way to log contractors time on site, 100% accurately and without any reliance on human contact.
What does this mean for remote management teams? “One version of the truth” for all their suppliers time on site. This enables easy validation of contractor invoices against these records. It provides real-time data on contractor’s time – giving a window into potential cost blowouts. Over the lifespan of a project this visibility can deliver significant cost savings and strengthen supplier relationships by highlighting best in class performers.
Automate administrative tasks
Administrative tasks are essential to a project but chew up valuable time. The introduction of technology can dramatically reduce this workload by automating traditional paper-based processes.
Health and safety compliance is a great example of this. Mitigating risk and keeping people safe is a critical part of any project, albeit time consuming when operating with paper-based compliance processes. Solutions like Forsite enable management teams to digitise, then completely automate their health and safety process to a contractor’s smartphone. This reduces the administrative compliance workload for a project and gives the management team piece of mind that their records are easily accessible in case of an audit.
Automation unlocks time to focus on value adding activities instead of repetitive tasks. The construction sector is late to adopt such solutions, so is poised to greatly benefit from these technologies.
Leveraging on site data
As you have probably heard, data is the new oil. The rise of computing power along with the introduction of technology at all levels of business operations enables deeper analysis and optimisation of just about everything we do.
The potential for construction to leverage data is enormous. Traditional sites can be a logistical nightmare with inefficiencies to improve at most stages of a build. The introduction of tech into this industry offers an opportunity to collect a wealth of data then analyse it to improve outcomes in the future.
Long term, the ability to analyse big data will fundamentally change cost management towards a predictive model. These will aim to optimise a project’s profitability based on years of intelligence from other projects undertaken.
While this is still some time away, the key to moving in this direction is to start collecting data by implementing solutions that can help your operation now. The right solution will help you better forecast while optimising costs at a micro level today.
With so much pressure on cost management in 2021 technology offers an achievable solution to optimise projects now and into the future. Those that lead in the digital movement will place themselves in a strong position for the foreseeable future.
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