Why Embracing Construction Tech Leads to Sustainable Profit Growth

Whether it’s activity on the jobsite or necessary, behind-the-scenes work that takes a construction project from start to finish, technology is changing the way companies operate to help increase profitability.

Now, more than ever, the industry is leaning into advanced technologies and automated solutions to continue working safer and smarter in order to run a more cost-effective business. Embracing technology helps companies remain competitive with increased efficiencies in both labor and processes, allowing firms to continue operating as essential businesses while helping to reduce costs.

In a recent USG Corporation and United States Chamber of Commerce Commercial Construction Index, 60% of contractors reported using one or more advanced technologies and 80% said they plan to implement advanced technology within the next 3 years.

With most respondents citing intent to implement a new form of technology by 2022, it’s clear that tapping into new tools to improve efficiency is top of mind for the industry. There are three areas in particular where technology impacts construction, ranging from jobsite productivity and safety to back-office efficiency, allowing for growth and scalability without adding head count.

Increased Site Productivity

No two construction sites are alike, which creates unique needs and challenges for contractors who are often managing multiple jobsites and projects at once. Streamlining for productivity can be difficult, but 78% of contractors believe advanced technology can increase productivity in the industry, allowing more efficient operations to keep projects profitable and on schedule.

Automating the way project information is generated and shared has gone from “nice to have” to a reality in the construction industry, leading to increased collaboration, easier information sharing and more efficient ways of working.

Building information modeling (BIM) is providing construction firms with logistical data to mitigate risks early in the process to avoid costly mistakes and drive innovation before a project even begins, giving valuable insight to better plan, design, execute and manage a project.

BIM has taken what was once 2D drawings to 3D visualizations to help with viewing renderings, detecting potential conflicts and planning logistics. Beyond 3D visualization, which in and of itself is a tremendous lift, BIM models have advanced to incorporate cost and time dimensions, with the end-in-mind target of the ultimate knowledge transfer experience to the owner for facilities management.

In the same vein of enabling visibility, the use of drones on jobsites has also given contractors the ability to view locations, materials and workers from a new perspective to ensure people and processes are operating efficiently. With the ability to capture aerial images and video, it’s easier to map projects and monitor progress to keep things on schedule. And, with access to new resources like drones, it’s not surprising that 75% of contractors believe technology is leading to better overall management of project schedules, according to the Chamber of Commerce report.

Increased Worker Safety

In addition to increased productivity, 79% of contractors cited “improved jobsite safety” as a top benefit and reason for investment in advanced technology. Construction sites have inherent risks and according to the U.S. Bureau of Labor Statistics, it was the leading industry for fatal work injuries in 2018. Fortunately, the safety of workers on the jobsite is another area of the industry where technology can make a major impact, with a safer environment contributing to increased productivity, decreased turnover and more timely projects.

Now, wearables and smart personal protective equipment (PPE) help record and track data to decrease operational and environmental risks that could lead to injury or death. Wearables can also track worker location, allowing safety personnel to locate and react to jobsite incidents quickly and investigate locations and incidents thoroughly.

In addition to the benefits mentioned previously, like the ability to complete site surveys and inventory management, drones can also be used analyze and enforce safety precautions. According to the 2018 Commercial Drone Industry Trends Report, leveraging drones can increase construction site safety by 55%. What were once safety checks completed by an inspector in-person can now be done by a single, pilot-operated drone from a safe location. With an increase in site safety and efficiency, 64% of general contractors expect to use drone technology by 2022.

Increased Back-Office Efficiencies

While the construction site is the most visible area of transformation, technology has played an equally important role in improving business operations behind the scenes, like keeping up with compliance regulations, time sheets and the accounts payable (AP) and payments process. Transitioning to cloud-based technology was a major shift across all industries and, in construction, implementing cloud-based solutions keeps contractors, back-office functions and the jobsite more connected than ever.

Software-as-a-service solutions change the way businesses track critical data, making information easy to capture and readily available. No more lost documentation or manually transferring and filing important materials. With the help of technology, the construction industry can quickly process data and act upon it to make informed decisions, identify gaps or opportunities and run a more efficient operation.

Technology also allows businesses to digitize previously paper-based processes, like AP and payments. By integrating AP automation solutions directly with key accounting software, firms can eliminate manual tasks and paper across the full invoice to payment process. This means AP teams are no longer writing, stuffing and mailing paper checks or keeping track of paper invoices.

Contractors can review and approve invoices and payments from any location, at any time, using a mobile device, so there are no delays in payments—and, therefore, no delays in projects. In the current environment, while aspects of the construction business are operating remotely and not out of a central office, AP automation allows for critical payments to continue regardless of circumstances. With increased visibility and control over cash flow, contractors, subcontractors and suppliers also know where payments are and when they will be received, strengthening this vital relationship.

Cloud-based technologies also give contractors access to vital information for planning and scheduling future projects. With quick and easy reporting in AP solutions, contractors can review payments made throughout a project to better predict future costs, ensuring accuracy and profitability moving forward. Other cloud-based solutions allow contractors to monitor where time and resources are being used to help keep costs down, track change orders and ensure proper billing to increase profit margins.

Moving Forward

Technology is rapidly shaping and improving the construction industry, from jobsite safety to the way contractors pay bills. As the use of technology continues to gain momentum, companies that resist this change will fall behind in productivity and profitability. But those eager to adopt can get a leg up on their competition and set themselves up for sustainable growth and significant profits in a shifting landscape.