by George Hedley
Are you convinced computers are here to stay? Many construction companies still haven't embraced technology as a required business survival tool. And survival is not enough to be a leading company that stays ahead of the competition, maintains loyal customers, and always makes an above average profit.
In a recent survey I conducted with over 2,000 construction company managers, staying on the cutting edge of technology is not a priority. Most companies are scrambling to catch up with computerization and are content doing the minimum to stay even with their competitors and customers. When I speak at construction industry conventions, I observe older company owners hope to retire before they have to learn the computer. One of our company goals is to be a technology leader. We won't consider hiring a project manager or superintendent who isn't 100% computer literate in e-mail, word processing, scheduling, and estimating. It is too risky to hire someone and hope they will become techno savvy.
Customers Are #1
It is obvious construction companies must conform to their customer's wishes or lose business. Over 75% surveyed use e-mail to correspond with customers and 66% to communicate with architects and engineers. Only 50% use the internet for job correspondence with other contractors, subcontractors, or suppliers. Contractors reluctantly follow their customer's wishes but don't embrace technology for their own business and project management practices.
Only 10% use the internet to submit invoices or progress payments to customers. Our industry is considerably behind the times compared to others. In the retail business, products are ordered, produced, shipped, paid for, and re-ordered without a single piece of paper. Construction still requires paper invoices, original and notarized signatures, conditional and final lien releases, joint checks, architect and bank inspector approvals, and copies for everyone involved.
Computers are becoming more of a required tool as 50% of project managers carry laptops while only 25% of field supervisors have or use a computer. Maybe the old mindset that field people work with their hands instead of their head still prevails.
Years ago we bid a large office building project. The specifications required us to submit a construction schedule as a part of our bid using Microsoft Project software. Up until then, we were drafting simple bar charts schedules by hand. This bid requirement forced us to finally move to computerized scheduling. Once we computerized, schedules became simple and easy to modify or update, and what once took hours had been reduced to minutes.
Of the companies surveyed, 50% now use some type of scheduling software. A few years ago, we upgraded our scheduling software to a more sophisticated cutting-edge comprehensive package. Now when we propose on projects, our schedule puts us ahead of our competitors and often is a major factor to winning the job.
Tech saves cash
A few years ago, I read an article how General Electric reduced their overhead costs 25% just by implementing and maximizing the use of technology. This inspired me to make it our company goal to reduce paperwork by 50%. We researched and purchased the best integrated construction project management software for our size company. It has helped us become more efficient as we eliminated paper, faxes, and mail for project minutes, job correspondence, shop drawing tracking, subcontract logs, change order requests, daily job reports, and many other items. We also contracted with a blueprint company who receives the plans from architects and engineers and then transmits them to our subcontractors directly over the internet.
To my surprise, the survey shows only 20% of subcontractors and 33% of general contractors use a comprehensive project management software package. What are they waiting for? Recently I spoke at a Marriott construction conference. Marriott requires all of their contractors and subcontractors use the same software system for every project. On most government projects, a project website is built to handle all job related matters including scheduling, correspondence, changes, and everyday communications.
Spend money to make money
The last question surveyed: 'Do your kids know more about the computer than you?' Answer: 50% said yes! The world is changing and technology is a reality. Companies who realize it become leaders while those who don't fall behind and never catch up. Technology can make you more efficient, more professional, help you win more profitable contracts, keep track of job costs, and make you money. Leading companies invest at least $2,500 per employee per year on technology. Are you keeping up with tech?
George Hedley owns a $75 million construction and development company and
Hardhat Presentations. He speaks to companies on building profitable businesses,
leadership, and loyal customers. He holds 3-day in-depth "Profit-Builder
Circles" open to construction company owners in an interactive roundtable
format every 3 months. His "Profit-Builder System" includes proven
tools to always make a profit, build equity, create wealth, win profitable
jobs, motivate your people, and enjoy the benefits of owning a profitable company.