Construction Digital Innovation is Essential for Productivity Gains
In August of 2021, when construction tech startup Agora announced a $33M round of funding and triple digit growth, all investor eyes were once again on the construction technology. A $10 trillion global industry, investors see the potential for technology to disrupt one of the slowest adopters of digital transformation. It almost sounds too good to be true, says any cynic that doubled down on Katerra, the construction tech unicorn that filed for bankruptcy in June. On the other hand, the Procore IPO was considered a huge success, albeit over 15 years in the making..
While there are lots of variables that contribute to the success or failure of a startup in construction, economists all agree that labor productivity growth is essential and long overdue. According to McKinsey, it’s been stagnant since 1947.
A frenetic scramble to fill millions of open jobs has been going on in construction for the past decade. Anecdotally, the construction industry talks of a “lost generation” of workers caused by underinvestment in technology, poor construction workforce management and recruitment, and an overdependence on low-cost labor. There’s no sign of the construction labor shortage gap closing. In fact, it’s getting worse. According to Associated Builders and Contractors, construction businesses will need one million more workers over the next two years to keep up with demand. Solutions such as immigration reform and workforce recruiting and training will take years. But digital transformation and the investments in construction technology could help today.
Despite innovations and significant investments in construction technology, the construction jobsite, not the office, is where a construction company makes its money. Or loses it.
Beware VC’s offering Pricey Unproven Tech
The majority of technology solutions promoted today don’t address jobsite management. Instead, they are either trophy projects for high-end projects, or back office solutions meant to streamline workflows with project owners, financers and designers. Katerra was an example of extreme VC hubris, an attempt to disrupt a huge complex industry without nearly enough capital or real world solutions.
Most other VC backed startups that offer jobsite management solutions relay on new, sexier but unproven technologies such as sensors, drones, video automation and robots. They may eventually offer benefits. For example, a drone can access a rooftop or other hard to reach area safely, and a robot might replace a worker at risky location. But many of these products are expensive and won’t be used often enough to justify the investment. This makes them costly except for a small community of national, multi-national or global construction companies. Even for these larger construction firms, measuring the ROI on these higher end technologies will take years. Most will get used in pilot or demonstration projects, but not become day to day tools.
Construction Headquarters is Increasingly Digital Already
Today’s back office solutions primarily consist of software for accounting, engineering, finance, estimating, bidding, CRM,HR and project management. All of them are built by and for knowledge workers. Project management and ERP solutions are the closest to addressing construction’s poor productivity. After all, construction is a project business. Yet gains are limited because project management solutions can only do so much with project complexity and change management. A project plan is an abstraction while a jobsite is where the real world of building occurs.
Also, getting the most from a project management solution requires having the right staff on board. Finding certified project management professionals is not easy, especially those trained in construction project management, and they are very highly compensated. According to the Construction Management Association of America, earning a Project Management Professional (PMP) certification requires a minimum of 36 months of project management experience, including 4,500 hours leading or directing projects. The distinction between leading and directing and being responsible-in-charge is critical. Additionally, the PMP requires 35 hours of classroom education.
And that’s before the training on a particular project management software platform begins. Months of training are typically required before some very expensive software can prove its worth. And most users of project management software are surprised to discover that they must enter almost all the data the software requires. Hope they are good typists! Safe Site Check In implemented Procore integration to automate the capture of daily manpower, visitor and observation data without keying or screen time.
Construction Jobsite Management Differs from Project Management
Jobsite management is largely about managing people. As project size grows, the role of project manager and jobsite supervisor diverge. Any experienced project manager will tell you that planning may be difficult, but it’s still easier than making the plan’s scope, cost and schedule become reality.
Construction jobsite management is about keeping workers and subcontractors accountable, plus handling the innumerable variations that work against a good outcome. And construction productivity won’t improve until the workforce on the jobsite is brought into the digital era.
Since construction workers in the field want to build, not key data interpret or manipulate data, digital transformation will only happen if productivity-enhancing solutions are easy to use and improve productivity almost immediately.
Safe Site Check In is a Construction Jobsite Management App Ready to Use Today
This is likely to lead to a new category in construction tech: Construction Jobsite Management. Since every worker is already carrying a smartphone, jobsite management solutions will be apps. They won’t entirely solve the staffing issue, but they’ll help close the productivity gap by streamlining activities and functions that are time consuming or administrative in nature. Essentially, actions that detract from the actual building process. They’ll also connect to the back office, project manager and site supervisors without adding more screen time or training.
That’s why we created Safe Site Check In — digital technology easy to use in the field to automate jobsite visitor management, the daily log (aka daily report, diary or book) and Procore integration, among other platforms. We make jobsite management easy.
Opportunity awaits those that address the jobsite productivity gap through digital transformation. They aren’t easy problems to solve but we can use technology to shave minutes or hours previously spent on screen time.