Construction firms: Transform software from a problem to a solution
Successful companies in industries around the world continue to incorporate new technologies that allow them to be more responsive to customer and partner demands, which increase the level of performance that customers expect. Construction firms are no exception. Given the highly competitive nature of this industry, and the narrow profit margins encountered on many projects, high levels of efficiency and performance are particularly important. Antiquated, limited, or incompatible software systems can make reaching or surpassing this level of performance difficult for construction firms.
To improve overall performance, construction firms must find new ways to improve the efficiency, accuracy, and transparency of their key business processes. While not the primary focus of construction firms, key business processes—such as estimating, billing, scheduling, payroll, change order management, and materials and inventory management—are nonetheless vital to a firm's success. Many construction firms rely on a varied—and perhaps incompatible—set of specialized software applications to perform these key processes, resulting in lost time and money.
Purchasing an integrated software system that is capable of being scaled to specific business requirements can help construction firms avoid costly updates from numerous vendors. An integrated system can also help prevent firms from purchasing unnecessary applications and and wasting time getting different software "solutions" to work with one another.
How inefficient software systems hinder performance
Common software problems—such as limited functionality and incompatibility between applications—demand additional time and attention from office personnel. This wasted time distracts workers from the company's primary focus: construction. The software solutions construction firms rely on for key business processes are often a piecemeal collection of applications, leaving firms with little alternative other than to build a patchwork system of additional software applications to provide a working interface. These additional software applications (including data management systems) are almost certain to further complicate key business processes. They can be time-consuming to use, difficult for new employees to learn, and potentially inaccurate in the results they produce. Further, they decrease the transparency of information within a firm.
Inefficient, non-transparent data management between key business processes also hinders management's ability to monitor key performance indicators (KPIs), which are the primary metrics that enable proper strategic decision-making. The software systems that support key business processes must properly manage the data necessary for monitoring KPIs. Without integrated software systems in place, it can be very difficult for management to make informed decisions at strategically critical points, when timely, accurate information is most important.
Relying on incompatible software solutions that offer limited functionality can result in inefficiency and management challenges for construction firms. Software-related diversions and complications in key business processes decrease productivity, limit managers' ability to make intelligent business decisions, and lower profitability.
Integrated software solutions boost performance
Construction firms that understand their key business processes, and the information requirements of these processes, can avoid many efficiency, productivity, and information transparency challenges. Careful consideration in selecting software systems is critical, as ongoing problems that can result from adding unsuitable new software can render those upgrades ineffectual.
Construction firms must evaluate their key business processes and data management requirements, both now and looking into the future. For example, one firm may need to improve a particularly awkward scheduling system, while another firm may need a more robust and better-integrated estimating system. A third firm may want to grow significantly in coming years. These current needs and future goals should guide software purchases.
Successful, profitable construction firms focus on construction—because they are not in the software business. But construction firms can benefit from considering scalable, modular, fully integrated software solutions that provide the necessary features and functionality, while also sharing data automatically between applications. Such integrated software solutions allow for more rapid and accurate completion of key business processes, and better information transparency to support timely KPIs.
By investing in a scalable, modular software solution, construction firms can also avoid purchasing a software system that offers more functionality and applications than necessary, which can be expensive for the company and confusing for users. A modular software solution—made up of a group of integrated applications—can grow with a construction firm. This can help a construction firm avoid some of the problems associated with a software system that, in contrast to the system that includes unhelpful functionality, offers limited functionality. These limitations can then require the purchase of more applications from other vendors, which can hinder growth or create the compatibility issues mentioned above.
By purchasing an integrated software system that can be scaled to specific requirements, construction firms can avoid the confusion and cost of learning and maintaining unnecessary applications as well as awkward, detrimental interfacing challenges. By ensuring that the correct technology is in place to enable key business processes to be completed efficiently, construction firms are better able to meet or exceed project owners' expectations, because they can focus on their core competency: construction.
Sabine Hoover – Sabine is the team leader for FMI’s Denver Research Group and is based in Denver, Colorado. She has more than seven years of research experience, and is responsible for designing, managing, and conducting research projects for a wide range of stakeholders. Projects typically range from small, custom research requests to large, comprehensive market assessments that help clients in their strategic planning or business development efforts.
Nick Schubert – Nick works in FMI’s Denver Research Group and is based in Denver, Colorado. He has been working with FMI for the last year and a half, in support of the Denver Research Group team leader on a variety of project types and sizes, from small, custom research requests to large, comprehensive market assessments. Nick recently finished his J.D. at the University of Denver College of Law, and has been awarded the 2006 Roberta Steinhardt Ehrlich Award for Excellence for his work in mediation. |
