Why Are Contractors Using Fewer Software Applications?
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Compared to other industries, construction tends to be slow to go digital. That doesn’t mean the industry isn’t going digital at all, though. The majority of construction companies are using a variety of software solutions for accounting, project management, estimating, and other important functions.
Every year, JBKnowledge releases its Construction Technology (ConTech) Report detailing the state of technology use throughout the construction industry. The 2017 report includes many insights about software use in our industry. Particularly interesting is data suggesting companies are using fewer software solutions than they were in 2012. Five years ago, 22.9 percent of contractors reported using six or more solutions. In 2017, only 16.6 percent were using that many, while 22.5 percent of respondents—the largest group—reported only using two software applications. This suggests businesses are integrating software functionality and working to simplify processes.
Let’s take a closer look at what this could mean for the industry, as well as where contractors might go with software in 2018.
Tying construction workflows to software
One of the biggest reasons construction companies turn to software solutions is to streamline workflows. Workflows—the repeatable processes that go into completing jobs—occur in all departments, and often involve multiple departments and multiple people. A common workflow in construction might look something like this: The need for a change to the original project plans exists and a change request is issued; that request is routed to accounting for approval; if the projected cost involved with the change is above a certain amount—say $50,000—then it would need to be routed to owners or trustees for additional approval; the change would be approved and sent back to accounting to issue a change order that change order then needs to be communicated with everyone on the project team, including subcontractors that might be affected by the change.
The 2017 ConTech Report indicates while these types of workflows are the most likely to utilize software programs with automated workflow functionality, many contractors are still using manual methods like paper or spreadsheets and communicating changes via phone or email. This is an interesting finding, and suggests that while companies are opting for software, things aren’t necessarily as integrated as they could be.
The report also found that software is often adopted at the department level. Accounting and project management software were among the most prevalent types of software used by contractors last year. Software adoption is generally a good thing, but there is a downside to department-only adoption: The chosen software solution might not be the best solution for the whole business.
Is construction software becoming more integrated?
As mentioned above, the ConTech Report found that companies are using fewer software solutions than in the past. While we can’t directly conclude from the data that this trend is driven by companies opting for more integrated software—the report points out that a company might reduce the number of solutions it uses due to costs or other reasons—we’ve seen many companies transition to integrated software solutions in order to work smarter. This transition will likely continue in 2018 as businesses look for ways to operate more efficiently and effectively.
The benefits of this transition are numerous. Many businesses still use manual efforts, spreadsheets, CSVs, email, and other methods to transfer data between software programs that aren’t integrated, and those methods can be time consuming. Disconnected methods also make it easier for information to fall through the cracks, potentially leading to miscommunications, mistakes, and delays. Integrated solutions, on the other hand, improve communication both within workflows and across departments and functions, enabling better collaboration throughout the entire organization.
Solutions like Viewpoint’s Office/Team/Field software suite help improve performance and visibility, allowing all members of an organization to get the data they need. If you’re ready to find out how an integrated construction software solution can benefit your business, get in touch, or reach out to us on LinkedIn.
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