Don’t wait for problems to improve tech, says expert
CFOs at general contractors may hesitate to invest in new technologies without understanding the full range of cost benefits those solutions can offer. This article from Construction Dive offers advice to help CFOs ensure optimal ROI from technology purchases.
Information technology often falls under the chief financial officer’s umbrella at construction companies. This means that his or her decision on how to spend money on technology can directly impact a contractor’s growth.
For a lot of construction companies, aging technology is often a problem, and one not noticeable until it causes an issue, according to James Benham, CEO of JBKnowledge, an information technology services company specializing in construction and insurance.
“In most of your budgets, technology is like a lagging indicator,” Benham said at the Construction Financial Management Association Conference last month. “You wait until there’s a big pain point to actually bring on more support staff. And then you get behind the eight ball.”
It’s vital the CFO or head of IT at a construction firm knows how to talk to the IT department, Benham said. A good IT staff is a great tool for advancement, but Benham compared a poor relationship with staff to a hostage situation – they have all the information, and it’s not always easy to get it from them.
He laid out 10 questions that CFOs should ask about their IT systems. They are:
- How does technology fit into our company’s goals?
- What is our company’s appetite for change?
- What in our business causes frustration?
- What are our tech priorities?
- What is our data strategy?
- How can we distribute the cost of our technology investment?
- How can technology improve our process?
- How do we calculate preliminary ROI with a degree of certainty?
- What is the best technology to generate a positive return?
- How do we evaluate our ROI after implementation?
Building a relationship with the IT team – whether they are in-house or a contractor – can be the catalyst for change, Benham said, and asking questions like these help that process. While some companies or teams can get “shiny object syndrome,” as Benham called it, a functioning IT team can be the eyes and ears of the office, aware of the tech troubles that workers experience.
Thinking of IT as just phone and laptop repair experts not only diminishes their role, it keeps companies from reaching their fullest potential. Today, every aspect of a job is impacted by technology, as smartphones and tablets dominate offices and jobsites. As a result, the tech team is the boots on the ground who know the pain points and needs of the entire workforce within a company.
“You need to mentor them on becoming architects of pain,” Benham said. “Look for the pain, the pain is where the profit is.”
One of the most important questions, Benham emphasized, is “What is our data strategy?” Even being able to explain a strategy is not enough, he said; each person involved in the strategy also needs to be able to show it.
Despite widespread use of smartphones and tablets, nearly half of the file and data sharing in construction is still done manually or via spreadsheets, according to respondents to a study from JBKnowledge. That opens the door for a large margin of error, Benham said.
The first step, he said, is collecting data in a digital form. Though many still cling to printed drawings or reports, that can lead to inconsistencies and is more difficult to analyze. Companies should get started on collecting and sorting data sooner rather than later, Benham said. Eventually, they’ll need to do some more advanced data analysis. When that time comes, its better to have a backlog of information to turn to.
Getting experienced or traditional workers to try new methods of data collection can be hard, Benham admitted. Often, field teams can be resistant to change when previous systems have worked. The key, Benham said, is to simplify the process for the team. Providing QR codes on site, for example, for workers to scan and open image-mapping applications on their phone, can be an easy way to teach a new practice and show the value to all team members.
Analyzing the return on investment for new technologies can be challenging, Benham said, but he provided a good rule of thumb: if the cost is returned within 12 months, buy it. Be it software or another solution, if, within a year, the company or IT team predicts a positive ROI, go for it, he said.
The key to making a tech advancement or change is also to not expect a perfect result out of the gate. Learning to settle for “good enough” is a start, Benham said. Once one improvement in a jobsite process or data management storage is made, it is easier to take the next. Focusing too hard on an immediate, perfect solution can result in “analysis paralysis.”
Once a change has been made and the ROI is clear, it’s important to document it, Benham said. He suggested video and simply using a smart phone to capture the old way something is done, and then the new method. Just documenting the improvement can show the value of new practices.
When that’s shared with the company at large, it’s a lot easier to see why the improvements helped, and why it’s important to always evaluate how your tech dollars are being spent.
This article was written by Zachary Phillips from Construction Dive and was legally licensed through the Industry Dive publisher network. Please direct all licensing questions to firstname.lastname@example.org.