Editor's Note: This is Part 1 of this multi-part article series provided by D. Brown Management, which will address essential technical systems contractors rely upon-the various technologies used by the engineering desk, field foremen, CFO and owners and management. Each article will focus on technical systems and will provide an overview, best practices and pitfalls in selection and implementation of the various technologies. To read the next article in the series, click here.
Ten years ago, a contractor who effectively harnessed information technology gained a serious competitive edge over their competition.
Today, the bar has been raised in the industry, and use of technology is almost a requirement to compete. But there are still many competitive advantages contractors can gain over their competition by utilizing technology to integrate more tightly with their field crews, subs and customers.
In the near future, the contractor who does not effectively adopt the latest technologies will find it hard to be competitive.
We do not believe in technology for the sake of technology and sometimes the best technology truly is a pad and pencil. When reviewing any technology for your company, it is important to seriously analyze whether you will gain a solid return for that purchase. There are three primary advantages that a contractor will gain by effectively using technology:
Centralized Company Data: Would you ever consider having your accounts receivable tracked individually by different project managers? Of course you wouldn't. Most critical data within a construction company is very fragmented. This includes mission-critical data such as customer contacts, marketing efforts, bid results, employee training, etc. If you have not experienced the value of having all your company's data organized in one place, it is hard to see the full value here. We have seen dramatic improvements across all companies that make the leap of faith and go through the hard work of consolidating all their critical data. After it is centralized, it can be more quickly analyzed for potential opportunities as well as exceptions that management can address.
Standardized Workflow Processes: When it comes to scaling any business, one of the most critical things to do is to standardize workflow to a relatively high degree. The nice (and very frustrating) thing about software systems is that once a process is set up, it is difficult to change. What this requires from management is very precise thinking about the workflow processes involved in project management, marketing, estimating, accounting, purchasing, etc. Many times within a particular software application, these processes are defined in large part by the software company-the contractor has to figure out how or if they can fit within these processes. As a contractor works to integrate various software systems together or customize the applications to meet their specific requirements they will have to think through their processes very thoroughly. While this is very frustrating, the process definitely makes the contractor's business stronger in the long-run.
Increased Efficiency: In almost everything a contractor does on a regular basis from marketing to design to field management, there are technology solutions that will drastically improve efficiency. The low-hanging fruit is the minimization of duplicate data, while the pinnacle of increased efficiency is when your technology systems provide near real-time feedback on things like field productivity and then adjustments can be made daily-or even mid-day in the case of one very proactive contractor we know.
Look out for the next eleven parts of the series, which include:
- Understanding the Basic IT System - Servers, Central Storage, Remote Access and More
- The Accounting System and Related Modules Including Service, Equipment and Purchasing
- Project Management Software - Trends, Technologies and Integration
- Customer Relationship Management (CRM) Software - Getting and Keeping Customers
- Estimating Software and Integrations with Accounting, CRM and Project Management
- Building Information Modeling (BIM) Software - Taking Planning to the Next Level
- Document Imaging for Contractors - The Ultimate Time and Space Saver
- Streamlining Workflow and Exception Reporting - Keeping Your Business on Track
- Construction Software Implementation - Best Practices and Lessons Learned
- Keeping Your Data Safe and Secure - Viruses, Backup Policies, Access Control and More
- Keeping Your Technology Running Smoothly - System Maintenance and Management
We look forward to diving into this very important topic for contractors over the next few months. Along with this series of articles, we will also be augmenting the topics where necessary on our blog at www.constructionbusinessowner.com/blogs If you have specific technical questions you would like to have answered, please send an email to david@dbrownmanagement.com.
D. Brown Management is a consulting and management firm that helps construction companies improve profitability. Learn more at http://www.dbrownmanagement.com/. The article series will be provided by the following D. Brown Management consultants:
David Brown focuses on general management and operations including business development, project management, estimating and field productivity. He's also very focused on how information and exceptions gets presented to executive management and owners so rapid action can be taken.
Leann Evoniuk manages all financial solutions including helping contractors select and implement accounting/management software packages. Her perspective is especially critical because the culmination of most actions throughout a construction company end up being processed by the accounting system in one way or another. This is also the primary system for providing management performance feedback.
Dan Omer works to maintain and integrate all the technology systems for contractors including custom programming interfaces that are required to make everything "talk" and play nicely together. His perspective is critical for helping streamline workflow by eliminating double data entry, extracting management information and truly understanding what can and cannot be done behind the scenes with the systems.
Construction Business Owner, January 2009
