It’s all around us. Doctors are looking at patterns of effective care; retailers are watching how customers move around their stores, looking for merchandising clues; and taxis are unsure what to do about Uber’s algorithm-driven pricing model.
If the construction industry thinks the status quo will leave it alone, it needs to think again. At the very least, the industry must hire up-and-coming next-generation employees — individuals who are already living 100% in a data-driven world. They expect nothing different from their workplaces.
Of course, there are other imperatives too, including:
Profitability. Pennies add up to real profits. Construction is still notoriously inefficient. Why, for example, do mom and pop retail stores have sophisticated real-time inventory processes and technology, and construction companies rarely have any? That type of data control is basic for leveraging daily productivity and increasing profitability.
Time Constraints. No one has time to read long reports. And even if they do have time, they don’t want to take that time, given the pace of projects in today’s environment. And while information “noise” is overwhelming, there are key metrics that can change unprofitable or unsafe behavior, prevent operational problems, and better serve customers. This combination of need and time constraints means that data must be delivered visually, in real time and in a format to allow for additional insights. Sadly, most construction firms still deal with static and outdated reports delivered in PDF or hard copy format.
Planning/Predictions. Ultimately, we need to look ahead. What is coming in new markets? Where are employees coming from? What are the trends in our safety program? Data analytics are key to answering all these questions. The industry needs to move beyond simplistic numbers and look for true cause and effect. Averages and trends of data sets tell us what happened yesterday; regression and correlation help us predict what is going to happen tomorrow.
Technology Cycles. These cycles are compressing so fast — and costs are coming down at such a pace — that other, smaller companies can make important investments too. Instead of investing millions in enterprise software, could perhaps the amount of investment similar to the cost of a backhoe be invested in data management software and/or a custom-developed mobile application that meets a specific internal need? These kinds of investments in data intelligence may be important for long-term improvement to profits and mitigation of risk.
For construction and engineering firms, the question used to be, “Can our firms evolve towards data-driven investments?” Now the question is, “Who will the leaders and laggards be in this area?” To avoid falling into the second category, companies need to be thinking about the following questions:
- What is your long-term data and IT strategy?
- How do you spend your time and money?
- Do you invest in “one-off” ideas du jour in the name of being an “innovative” company, or do those investments relate to one another as well as to your firm’s strategy?
- Rather than just tell your staff, “We are open to all ideas,” do you also provide understanding as to the most critical business imperatives that you are trying to solve for? (Whether it’s operational or project challenges, talent shortages, business development constraints, etc.)
- Are your systems producing accurate data?
- Do your systems provide data and insights for today… or partially accurate data for last month?
- Do you put the reporting into the hands of your bright staff or rely on accounting or IT to create static reports?
- Are you delivering visually appealing and easy-to-understand data?
As you work through these questions, remember that developing your data strategy is an advanced “keep score” function, but with the purpose of making better decisions surrounding getting work, doing work and building your bench. Other industries live by data, and the construction industry is ripe for change. The time has come. Construction can, and will, get there.