Navigating uncertainty and boosting productivity in the construction sector

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One of the largest industry sectors, with a gross value of £122 billion in 2021, construction has rebounded in a big way post pandemic. Some figures suggest that workloads spiked by 66% in the 12 months to July 2021 (The State of the Field Service Sector, a report published by BigChange). 

However, in parallel, 2022 is set to experience a major labour shortage of around 665,000 construction workers. According to trade association ABC, an estimated 1.2 million construction workers will leave their jobs in 2022, accounting for much of the shortfall. At the same time, entry-level construction laborers increased by 72.8% against an increase in the total number of construction workers of just 25%, highlighting a large skills gap. 

6000 wasted hours a year 

When you consider that poor back office processes in the industry are collectively taking around 6000 hours every year, it’s clear that rapid action to help mitigate this shortfall is required. 

One of the challenges in addressing poor productivity is that construction companies have been slow to embrace digitalisation, and instead have relied on spreadsheets and paper-based processes for longer than many of their peers. As workloads have spiralled, they’ve invested their energy in keeping up with the deluge, fighting against the inefficient processes in play to a degree, rather than taking a longer term view. Given that nine out of ten projects were delivered late in 2021, and over two thirds (69%) went over budget by at least 10%, it’s clear this isn’t sustainable.   

In fact, taking a step back and understanding the level of back office inefficiencies, and taking action to modernise and digitalise, can free up valuable resources to instil greater productivity, collaboration and accuracy, and support skills and labour shortages which are so prevalent currently.

Expediting digital investment by 70% 

The good news is that we are now seeing significant traction in this area with more than 70% of those involved in construction technology planning to invest more in 2022 compared with 2021 according to research.

CIS systems in particular, which incorporate financials, can facilitate greater efficiency, productivity and collaboration. When it comes to project management, they can provide a comprehensive overview which spans all contractors, subcontractors and employees, thus ensuring the right people and equipment are at the right site at any given time.

Crucially, they can deliver enhanced communications and workflows which can flag anomalies and provide trends and insights. These insights also support the customer experience, as documents and reminders can be stored to manage communications across the entire customer journey. In turn this of course helps to mitigate the time, cost and frustration associated with relying on excel and long e-mail chains to manage time-sensitive decisions and activity.  

Effective contract costing can make or break the profitability of a particular job. Fully integrated with financials, the best systems span all elements of contracts management, managing contract costing, valuations, sales applications, purchasing and subcontractors, from payment applications, VAT invoicing and cash receipt matching. Through being able to measure actual expenses against forecasted costs to flag gaps and facilitate intervention before they get a chance to escalate, costs and audit trails can be identified in real-time. This can then be used to support short term tweaks in the project’s budgets and/or timeline, and feed into estimates and projections for future projects to increase accuracy. 

Embracing a new digital era 

There’s no doubt that the future of construction is buoyant. Modern, future-ready back office systems and processes are therefore needed to support a new era and ensure the sector can capitalise on its growth potential.

Ultimately, the right kind of digitalisation can help equip the construction industry for the future through instilling resilience and agility, and reducing the impact of the unpredictable. 

Those technologies making the biggest difference are ones which capture, analyse and distribute insights in order to manage a project faster, more responsively, and more accurately. These insights help teams anticipate and respond to unpredictable issues quicker, or even to prevent them before they arise. In strategic terms, this results in increased opportunities to improve worker productivity and bring more jobs in on time and on budget, not only helping to mitigate the labour shortage, but enhancing the customer experience and reputation along the way.  

To learn more about our CIS solution, CIS 5, please contact us today to discover how it could help your projects or to arrange a personalised demo for your business.

Posted On: July 29, 2022