35% of construction costs are accounted for by material waste and remedial work!
I am certain a similar issue faces Capita, Serco, Mitie, 4GS, Carillon and other BPO contractors. Imagine the impact on the bottom line of reducing this by 5% points to 30%. And then more...
If ever there is a case for big data analytics I would start here. One reason these costs are so high is the black-hole between planned outcomes and actual activity. The cause?
These processes are seldom digitised and usually manual with poor records and therefore data. Probably 80% to 90% of the data is unstructured and not usable by enterprise applications, analytics or BI.
Snagging lists lead to remedial work that cascades between main contractors and up & down layers of subcontractors. Too often, descriptions and instructions are misunderstood and the remedial work not completed satisfactorily.
Not even mentioned variations; the constant process of identifying "out-of-scope" additional time and materials required to complete major projects proceed. Even when captured on digital devices this data is seldom discoverable and analytics ready.
Take Video and Photographic data, augmented by free-text commentary- no wonder all parties are forever arguing to whether work is finished and delivered to spec. That in turn leads to the fractious issue of retentions that suck out cash from every business.
It is no good thinking that giving onsite staff IP connected devices exploiting streaming video is the answer. You will come up against a practical hurdle- the other black hole between front-office online platforms and inflexible back-office legacy systems.
Only solutions delivering one single digital record across the front & back-office will work effectively. An online platform that link directly with the back-office via a uniquer and secure url as found with 360Globalnet.
One single digital record for every job and/or variation to share securely the information to specify, quote, accept, build and complete across all the supply chain.
And make sure it is not just the Project Management Office (PMO) that views the 10, 20, 30 KPI measures vital to any huge construction undertaking. Make sure all people can view these on whatever device they need:-
- Quantity Surveyors
- Site Foreman
- Suppliers
- Sub-contractors
- Inspectors
- Designers
- Board of Directors
- Consultants
- Facilities Managers
- Health & Safety
- Contract administrators
- Site Access Managers
- Analysts
In every large project how often is it difficult to find a specific document, drawing, blueprint, email, hand-written annotation?
Time and money wasted searching for the elusive item; fine of the document management system had a flexible way of structuring data but too often that is not the case, If everything were predictable there would be no problem. The truth is that the important information was recorded in free-form text or rambling emails. It was a sticky note stuck to a quote.
If only it were possible to apply a Google style search across all that unstructured data- maybe 50% to 80% of the data relevant to any large project. Well there is an answer 360Retrieve.
If it is good enough for police force investigations and Tax Authorities it should be good enough for construction and engineering contractors!
If it can reduce insurance fraud by 30% and more it will allow the PMO to root spurious quotes, job sheets, delivery notes and tackle unnecessary remedial work and excessive waste.
Collaborative Big Data Analytics for everyone involved in these projects so you should ensure mobile BI is a practical part of the digital platform so that all these users can access BI on the device of choice, wherever they are, whatever the time and whatever the size of the screen. Using all the data, not just the structured data, to see every project and every variation across the complete supply chain.
- Data in the new online platform
- Data in the core, legacy systems of record
- Joined into a 360 degree view of the complete project
Achieve that and you are well on the path to higher margins and happier customers
The construction industry is responsible for undertaking some of the biggest and most expensive projects on Earth. Huge amounts of resources and work go into construction projects which means that huge volumes of data are generated. Number crunching has always been a big part of construction – a commonly heard phrase is "construction companies are accounting companies which happen to erect buildings" 35% of costs are accounted for by material waste and remedial work. So counting the cost of every screw could be the difference between delivering on budget and bankrupting an organization (or several ) financing a build. Even though analytics has always played a part in the sector is it lagging behind other industries such as retail and financing. More advanced analytics and Big Data are just now finding their ways into the sector.
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