The Rise of Business Intelligence in Construction
5 Minute Read
The Rise of Business Intelligence in Construction
The construction industry collects mounds of data. But the contractors that dive deep into and analyze that data to make intelligent decisions about their projects and overall business strategy reap the greatest rewards. As business technologies grow across all industries and younger, more data-informed professionals enter the construction workspace, contractors are diving deeper into their data by deploying business intelligence solutions in construction that fuel real-time analytics.
Business intelligence in its simplest terms is the gathering of data — largely produced through construction management and project management software — and sorting and analyzing it to make intelligent business decisions. While studies show that the construction industry represents one of the last major North American industries to embrace business intelligence practices, the companies that have done so have gained significant benefits.
Among them: identifying areas where increased project efficiencies and productivity can be achieved; the ability to more accurately bid and scale for future projects; spotting consistent problems on projects and developing strategies to solve them; effectively factoring industry trends like building patterns, economic conditions and material costs into project planning; and streamlining labor and workflows to maximize overhead costs. For example, crews in the field can benefit from analysis that predicts material ordering needs, ensuring that the right materials are always on hand when they need them while project managers can streamline project planning by having material orders built into workflows.
Streamlining, Simplifying Construction Data
Business intelligence has caught on across multiple industries, largely embraced by those with highly-standardized processes, such as the manufacturing industry. While that industry remains largely systematic, utilizing business intelligence software to easily stay on top of all data points in the highly-variable world of construction is transforming how contractors analyze their projects’ strengths and weaknesses. The merging of so much project data and the complexity of jobsites, however, requires solutions that can handle the influx of information and present it in ways that don’t add layers of confusion or frustration to the end users.
Solutions such as Viewpoint’s Spectrum Business Intelligence — integrated into the larger Spectrum construction enterprise resource planning (ERP) platform — lets contractors easily take advantage of the cloud to collect and parse data in virtually any format they want. From in-depth reports, to dashboards, to creative charts, graphs and even geographical mapping of data, Spectrum BI puts the end user in the driver’s seat, removing the headaches of trying to manually make sense of the mountains of construction data, or wait for specialized reports that internal IT staffs or external consultants are needed to pull together.
Effective business intelligence solutions like the one available with Spectrum is fueled by a data warehouse and data analysis platform. By integrating directly with the contractor’s ERP system, the data warehouse is automatically refreshed with the latest data, organizing the information into logically organized data cubes. Once the data is aggregated, the data analysis platform lets users view or manipulate the data to glean the information they seek. With Spectrum BI, the process is as easy as dragging and dropping data fields into the analytic and report builder canvas.
“I feel like Spectrum Business Intelligence has opened up a whole new world for reporting,” said Howard Dembs, CFO with W. Soule and Co., which was one of the early adopters of Spectrum BI when it was released.
Endless Opportunities for Today and Tomorrow
The larger the job, greater the amount of data and potential for unplanned costs and risks. But with the risk also comes the increased potential for improved efficiency and savings, leading to a greater profit margin for contractors that are used to typically razor thin margins on projects. Better tracking and analysis of things like material and equipment, labor deployment and costs for projects, productivity rates for various subcontractors and much more after the project can lead to intriguing post-mortem discussions. But software that analyzes that same data in real-time creates opportunities to make a difference in the here and now.
Cloud-based, integrated construction software and mobile applications that allows data to be accessed and updated in real time are the technology tools helping construction business intelligence succeed in an industry where change is a constant. The aforementioned technologies allow visibility into all aspects of a project from any device, creating collaborative working environments for all construction professionals, whether they work in the field or the back office. Working with current data in real time lets contractors meet modern business needs. But the ability to analyze that data and quickly make smart decisions as part of the process is what is giving modern contractors a significant competitive edge.
In an industry where 35 percent of costs come from material waste and remedial work, cost management proves vital. Business intelligence software allows a firm to control costs by better managing and anticipating labor, inventory, project costs and more in every process from bidding to building. Bringing in historical data from other projects will help more accurately identify efficiencies that can be gained in current projects — pointing managers to the suppliers who have provided the highest-quality materials in the past or letting firms map out more effective and efficient building phase schedules in the field
When it comes to planning, the right business intelligence software can analyze and predict what is needed to be successful future and potential projects. This lets contractors smartly chase and bid for the right projects that provide the best potential for successful bottom lines.
By better understanding construction data and making actionable decisions to improve their operations for today and the future, they’re setting themselves up to better manage their organizational risk in an ever-changing environment. The more serious a construction firm is about lean construction processes and innovative building strategies, the more business intelligence software moves from a nice-to-have to a must-have. It’s simply an intelligent business decision.
What is your company’s approach to business intelligence? Let us know in the comments below. Or, contact us today to learn more about how the right business intelligence solution could benefit your organization.