Why Construction industry needs digital transformation
The construction industry needs to focus deeper on digital transformation for long-term benefits across growth, cost reductions, risk management, and productivity. The connectivity provided by digital transformation tools allows for agile decision making, greater visibility, and last-mile communication with on-ground teams. Managers are also able to digitize documentation and submittal management, which improves efficiency in project delivery.
Project management tools, ERPs, CRMs, 5D BIM, and other industry solutions are vital to connecting fragmented processes that are being performed across multiple locations. They introduce standardization across workflows, which helps in automating manually intensive processes. This improves cost savings further, while freeing resources to focus on timely delivery. Leading providers within the construction technology space offer enhanced visibility across projects, which organically improve output for enterprises.
Reasons for Why Construction industry needs digital transformation
While digital transformation can radically transform productivity levels, which are at roughly 1% for the construction sector, there are several challenges associated with complete digital transformation. That is why only about 16% of global firms have experienced sustainable performance improvements from digital transformation initiatives. Companies need greater clarity in their objectives when adopting digitization, while also understanding its core requirements from connected technologies.
Workflow optimization across all processes
A key need of the hour for construction firms is workflow standardization and optimization. There is a significant risk of misinterpretation, miscommunication, and execution lapses introduced when workflows are not standardized at scale. Decentralization, coupled with lack of visibility, can lead to compounding issues that can require rework and remediation.
The best way forward for the construction industry is to expand digital transformation across all levels. Digital transformation project management tools offer built-in modules and features for managing various processes, from procurement to daily financial progress. Workflow optimization provides a comprehensive project map for managers to access, which can expedite milestone achievement significantly.
Improved budgeting, forecasting, and financial management
Project financial management software offers forecasting, budgeting, and financial mapping solutions to construction firms for their portfolio. Project managers can prepare highly granular estimates with comprehensive budget heads that are configured to reflect site activities closely. Budget revisions, collaborative forecasting, and restructuring can also be performed through digital project management solutions.
Construction firms can also perform data analytics initiatives on their projections, estimates, indents, and variable costs for each project. Managers can visualize the financial data present within their data houses, and capture daily, weekly, and monthly consumption through various charts. Approvals, summaries, and flagging can also be automated based on predefined metrics.
Better productivity due to technology access
For global enterprises, around 68% of them focus on digital transformation for operational efficiencies to improve output. The enhanced productivity gained from digitizing various processes allows companies to improve project outcomes significantly. Teams have access to automation tools, standardized workflows, data management systems, and chat solutions for better efficiency.
An additional benefit that digitization provides construction firms is transparency in execution. All functions, such as finance, procurement, store management, and labour management, can be transparently analyzed with real-time updates. Data is automatically updated via the cloud, giving managers the right insights to ensure streamlined execution.
Enhanced collaboration capabilities for timelier delivery
Collaboration is key for timely delivery and quality execution. Construction projects are widely known to experience delays of around 2-3 years for large-scale projects, owing to complexities arising from lack of reach and management. Teams need to collaborate with internal and external stakeholders for seamless site decision making, using project management tools such as Zepth.
Enhanced collaboration also improves innovation within the execution, enabling teams to solve real-time challenges using the best available resources. Procurement challenges can be streamlined with faster indent approvals and outreach to material vendors. Site inspection issues can also be mitigated using on-site robotics, drones, and visual inspection methods in a highly collaborative way.
Improved reporting capabilities for construction firms
A key benefit of adopting digital transformation technologies, such as the cloud, AI, and analytics, is the access to in-depth reporting. Construction project managers can gain access to updated reports on on-site work, project schedules, material consumption, daily cost outflows, Capex insights, and inspections.
Detailed reports on payments, estimates, projections, labour output, and delays, can be generated within minutes using a centralized data housing and reporting technology. For many construction firms, the transition from manual to digitized data management can completely transform critical metrics such as profitability, time to delivery, and productivity.