Throughout my 20+ years of consulting, I’ve never seen the construction industry as ready for digital transformation as it is now.
However, despite the industry’s need, E&C professionals often resist adopting new technologies because digitalization is either too expensive, too time consuming, or may threaten their existing business processes.
This is where benchmarking comes in handy – both as a justification for change as well as a tool of measuring its impact. If we can leverage data to monitor trends, we can begin to predict how new technology can help save time or money over a project’s lifecycle. This is digital transformation in action.
To be fair, many of the applications developed for E&C over the years were a big hassle. They were either expensive to implement, time consuming to configure, or hard to learn and use in the field. Industrial-strength mobile devices, smart phones, and tablets are now efficient tools of the trade. But owners, contractors—and even some software vendors—often wrongly assume that implementing a specific software or solution alone will fix a broken process.
The key to examining – and ultimately fixing – the process is benchmarking.
The E&C industry is poised to more accurately measure their progress by leveraging the power of benchmarking once they've adopted new technology.
A report titled ‘Benchmarking and Improving Construction Productivity’ suggests nine steps:
The Associated General Contractors of America (AGC) and its members still utilize many—or all—of these steps when they’re running large projects.
The fundamentals of benchmarking begin by identifying how long any particular process should on average take to complete. Once this is determined, you can precisely measure that process against the expected time.
Take the first step by defining, mapping, and implementing a repeatable, measurable process. Start with a project that requires the least amount of effort with the highest level of adoption. Track process efficiency with the goal of continual improvement.
For example, measure the percentage of a given workflow against the expected time to complete. Identify workflows that are struggling to become 75% efficient. Workflows that are 10-15% below efficiency are to be expected, but you should understand the root cause of the delay.
Establishing a historical baseline on any given process is one of the most difficult exercises with potential customers. Failure to achieve this may be because either: a) the data wasn’t available, or b) repeatable processes weren’t consistently followed from project to project across the organization. Benchmarking processes can improve once E&C professionals identify the root causes of their cost overruns and schedule delays.
Measuring accurately on an individual basis—as well as across the project—can be very difficult. We often consult with clients who should have established repeatable processes for deploying construction management software and solutions.
For example, I recently spoke with a program manager who worked on large airport projects. She consistently struggled with how to quickly locate materials. The employees often re-ordered the same parts (expedited, of course) rather than spending time locating the materials already on-site.
The company must return the extra materials for pennies on the dollar at the end of the project. How does one accurately measure time wasted with monetary loss on materials? Companies like Here Technologies and Jovix have realized that wayfinding is becoming a necessity for construction workers searching for materials . . . as well as for passengers searching for gates.
These benchmarking processes are based on a specific set of steps and approximate times. We categorize these common processes into three areas:
We are on the threshhold of a new standard for Lean construction and predictive analytics. Oracle SaaS, PaaS, and IaaS technology is designed to help construction business processes. Our new Innovation Lab in Illinois was created to accomplish just that.
The owners and executors of tomorrow’s mega projects will have benchmarking and process insights they never imagined possible—all thanks to new benchmarking standards and measurables that we’re implementing in Oracle’s cloud today.