Standardized, repeatable processes are not just for owners who want to grow large companies. The current marketplace and economy are prompting construction companies of all sizes to transition to formalized processes and seamless software solutions to ensure profitability and minimize risk.
By standardizing processes and employing technology, contractors gain insight into performance, competitive advantages and costly oversights, and that insight helps them improve accuracy, efficiency and productivity. These five steps map the path to process improvement:
- Real-time analysis of project execution ensures on-schedule, on-budget performance and helps estimators bid similar jobs more accurately in the future.
- More precise estimates help win bids and allow for better profit margins.
- With an organized project workflow, rework is reduced, quality improved and costs controlled.
- Managing documents and project information electronically improves accuracy and accountability, reduces paperwork and redundancy and allows easy sharing across departments, which flows information into accounting for better management of financials, payroll, liens, change orders and more.
- Repeatable steps are easy to follow so that operations are simplified, efficient and easy to measure.
Processes are near worthless if they are not repeatable. Repeatable processes give construction companies ways to measure activity, draw conclusions based on those measurements and make improvements for profitability. Optimal standardized, repeatable processes can be achieved by using an all-in-one construction management software solution.
Klenck Company, a demolition and site work contractor that was growing bigger and winning larger jobs, replaced its accounting and manual systems with an all-in-one solution for estimating, project management and accounting.
Amy Lillich, the firm’s accounting coordinator, explains the challenges experienced with their previous processes and systems: “We did not have the information we needed for management to make confident financial decisions. We also didn’t have the tools to manage jobs specifically and the detailed information for forecasting future jobs.”
With a single solution to manage its entire process, Klenck Company has information visibility that allows them to achieve better profit margins by identifying red flags on jobs ahead of time. Lillich says, “The biggest cost savings will be in the increased productivity of our staff. From a management perspective, it gives me comfort that we are costing correctly to the right jobs and that the project manager is able to see the data and make the decisions instead of the accounting team making decisions related to job costs.”
Much of the value of such solutions is the result of the collaboration and accountability they create. Contractors who use all-in-one software report that information visibility is a necessary component of standardized processes. A comprehensive solution that’s shared by everyone—financial administrators, estimators, project managers, owners—provides stakeholders with identical, real-time information, which provides insight into all aspects of the project. This insight helps to identify critical action items.
Evans Chaffee, a full-service general contracting firm, moved from using disconnected applications and redundant methods to an all-in-one solution for complete construction management.
“We noticed that with the disparate systems, inconsistent data was beginning to creep in,” explains Chris Evans, CEO. In addition to streamlining the flow of information, the company considered how software could help them reduce overhead. Evans explains, “Now, with the all-in-one solution, project managers can be much more efficient because all the data is right there at their fingertips.”
When a construction company of any type or size decides to transition to standardized, repeatable processes, there are best practices to apply:
- Documentation — Communication and document management can become hectic. It is critical that documentation is complete, easy to track and accessible. The more a company can document activity and manage operations in real time, the more it can assure timely payment and averted risks.
- Commitment to improve — Repeatability and continual refinement of standardized processes provide a foundation for business scalability. Technology allows contractors to enhance efficiency and profit, but a company’s commitment to continuous improvement, including direct senior management support, is necessary to ensure benefits are achieved.
- The value of sharing — When company-wide processes are implemented properly, redundant data entry can be eliminated. It also provides owners with visibility that allows them to control operations more effectively. Remember that while the value of shared information is great, some information needs to be secure.
- Acting on the data — Once project information is properly documented and shared, the firm can analyze it to determine which types of jobs are most profitable. Then sales efforts can be focused on the “right” wins.
Construction companies that employ all-in-one construction management software are able to effectively establish standardized, repeatable processes. With everything in a central location and an easy-to-manage workflow, contractors can increase productivity and the profitability of every project.
