The need for digitization is intense in every industry and construction is no exception. But, being notoriously resistant to changes, the construction industry is still lacking behind the others when it comes to adopting new technological solutions for improving efficiency.
According to a report, less than six percent of construction firms utilize digital planning tools to the fullest, while 93% of them agree that digitization will impact every process positively. This is one of the reasons why construction is the least digitized industry in the USA with productivity remaining flat for the last 20 years.
After the pandemic, several players in the construction space are now aware of the benefits that digital tools and technologies can provide them. The gap between office and field workers grew during the last year which made them realize how they can work collaboratively using digital solutions even when working from a distance.
However, despite knowing these benefits, businesses in the construction industry resist changes. They aren’t sure about what is the best way to digitize their business and from where they should start. For some, investing in technology is too risky or not worth the effort. But, thankfully, with the right strategies and processes, businesses can play safe when on the road to digitization and it is all worth the effort.
The Need for Digitization in the Construction Industry
Before starting the journey to digitize their businesses, several construction business owners like to analyze the need. How will it help my business? Let’s imagine the scene of a traditional construction site to find how it looks like.
The first few things that come to mind are lots of equipment and machinery lying in a disorganized manner, workers running seeking instructions and supervision, and many waiting to get things done after they get access to the required information.
This is enough to find reasons why this industry is facing issues like loss of productivity, missed deadlines, and cost overruns for decades. On top of that, other pain points include environmental issues, disparate business processes, tough competition, increasing expectations of clients, and many others.
To solve these huge problems, the need for digitization in the construction industry is immense. Amid the pandemic, the construction sector lost around $60 billion in GDP (in the USA alone), with a huge reduction in jobs. So, to bridge this gap and overcome the damage done by the pandemic, businesses are now relying on digital solutions that can unlock efficiencies and provide benefits in the long run.
Increased Attention on Health and Safety
After the pandemic, construction businesses are under pressure to follow strict safety guidelines by the government to ensure business continuity. They will have to minimize on-site accidents and loss of lives on their construction sites to maintain certain standards.
Failing to do so will result in huge fines and not being able to bid on certain contracts. This calls for technologies like AR glasses, wearables, and exoskeletons to achieve the required safety standards and ensure the safety of workers on worksites.
The Productivity Gap
Productivity is a huge problem in the construction industry for decades. But, as per Mckinsey, the construction firms that use digital tools for supply-chain management, performing on-site operations, and automation experienced a 50% rise in productivity and revenue over those that relied on traditional solutions.
Using technologies like IoT, AR/VR, AI, and Machine Learning, construction businesses can automate almost all stages of their operations from planning to execution.
Cluttered Work Processes
Data is a valuable asset for improving the performance of a construction business. However, managing data and communication without digital tools and technologies can invite many problems and cause poor coordination between the field and back-office workers.
The only way to ensure a streamlined workflow is by using a digital communication channel and centralizing the data on the cloud so that every stakeholder can access it at the tap of a button when required. It will allow teams to collaborate in real-time and reduce the time it takes to pass key information from one division to the other.
5 Crucial Steps to Digitize Your Construction Business
1. Analyze Your Pain Points and Business Needs
Effective digital transformation needs proper planning catered to a construction business’s specific needs. With this mindset, it is essential to analyze your company’s pain points and what solutions can solve them when embarking on your digitization journey.
Before you make any effort towards the digitization of your worksite, you must know the “Whys” of your project. Consider asking the below-mentioned questions to your stakeholders:
- What are the problems we are trying to solve?
- How is it going to help us?
- What are our long-term and short-term goals?
Keep in mind, when making efforts to digitizing your construction business, your focus should always be on your long-term strategic goals. A lot of digital transformation projects fail due to leaders considering only short-term goals or instant returns.
While there can be some big successes, in the beginning, digitizing any business is a never-ending process of improvement with technology and adoption. As you set up an essential vision, all partners should concur it's the best way ahead to improve productivity.
To get more insights, ask stakeholders (of several job roles) what changes would have the greatest effect on their daily work. Analyze their ideas and find points that need critical consideration and can give considerable outcomes in the long and short run.
Including different stakeholders in the journey to digitization early gives them a feeling of ownership. Also, they'll give you data about their experiences that you may have missed while researching. By recognizing issues and willing to put data insights into practice, organizations can position themselves for a solid future.
2. Make Sure Digitization Efforts Reach the WorkSites
No matter how hard you work on planning, if you fail to implement it on the worksite, it won’t give you any returns. Around 80% of people in a construction business work in the field and these people lose a lot of time and productivity due to unnecessary paperwork, reporting, and redundant communication processes.
So, an important step while planning transformation is shifting your processes from paper to digital so that every stakeholder can easily access the required information. You must also make your field documentation, communication, and collaboration digital to ensure seamless business operations.
While selecting the software for digital site workflow, find solutions that are designed specifically for the construction field and are compatible with mobile and tablets. It is better if you have solutions that work offline as it is common for sites to have bad internet access. Also, the software you decide to use should have a user-friendly interface so that workers don’t spend much time looking for ways to do their day-to-day tasks.
3. Prioritize Operations to Automate
When creating a digital worksite, you must not feel over-enthusiastic and jump into everything at once. It is crucial that you take baby steps and achieve one goal at a time.
Consider automating processes that will make a huge impact at the worksite but are easy and small to make. Influenced by these changes, you will find champions in your team who can lead the adoption and give you valuable insights on future iterations. To get returns faster, consider automation inefficient and repetitive tasks first.
4. Update Your IT Infrastructure
Have you recently updated or checked your IT infrastructure? If not, it is crucial to update it once you decide to digitize your construction business. Just like new seeds can’t grow and give you results in an unfertile land, digitizing operations won’t help without a proper IT infrastructure.
Before purchasing and implementing tools for your site, you will have to:
- Upgrade your accounting, CRM, and payroll software
- Upgrade your networks and data to the cloud
- Keep a check on cybersecurity
- Update hardware
As per reports, manufacturing and construction are the two industries that are targeted most for ransomware attacks. Therefore, if you plan to use technology, make sure it does not harm the confidentiality of your business.
Your construction business requires the IT infrastructure and support to ensure it works productively all the time. Once you set up an IT infrastructure, you can plan advanced technological changes.
For example, wearable technology can ensure health and safety by notifying workers who are wearing smart devices when they enter a dangerous area. However, above all, you need the infrastructure to support all this. A robust infrastructure that uses the power of the cloud and empowers your employees through mobile technologies, needs to come first. Just when you get this right, you can guarantee further IT investment to enhance the business.
5. Calculate Your ROI
Whenever you make an investment in your business, make sure to calculate what you are getting in return. Calculating your ROI will give you confidence that your business is ready for a transformation and you are doing it all for bigger results.
Any investment towards adopting new tools and technologies to streamline business processes and efficiency quite often has a positive ROI.
While big changes in the ways you operate your construction business can be overwhelming and seem risky, you don’t need to step back and never embrace them. Taking small steps and strategic decisions can give you the clarity to handle digitization and change your processes for the modern digital era. Remember, these are the steps you are taking to put your business in the best situation for the coming future. Even if things don’t work for a while, hang in there, and find what’s wrong.