How to Leverage Technology for Improved Performance in the Construction Industry

The construction industry is experiencing a pivotal moment in digital transformation, facing persistent challenges threatening efficiency and growth. Despite these hurdles, a recent study indicates that 90% of construction professionals feel confident about market conditions over the next 12 months.

From navigating economic volatility and fluctuating material costs to labor shortages and productivity issues, construction executives are looking to technology as a motivating force for maintaining a competitive edge and solving challenges.

Based on the needs and goals of the construction industry, here are the key areas of focus to improve performance:

Data Collection & Management

Poor data management and utilization can contribute to significant project inefficiencies and budget overruns. Proper data handling has the potential to address these issues, streamline operations, and enhance decision-making processes.

Research suggests efficient data capture and standardization can result in a 13% savings on total construction project spending.

Despite recognizing the value of data, many construction entities still rely on paper records or non-digital processes in their workflows. Without a single source of truth, making informed decisions in a timely manner is nearly impossible.

Data collection is also crucial for organizations focused on sustainability efforts. The Global Alliance for Buildings and Construction reports that construction accounts for about 10% of total greenhouse gas emissions. Strategic and growth-minded construction leaders are reacting by tracking — or planning to start tracking — carbon emissions on their projects within the next 12 months.

Cybersecurity & Risk Mitigation

A top challenge toward digital transformation within construction is overcoming concerns around data security. It’s a double-edged sword — companies must become more digital to stay ahead of the competition, but more data and information hosted online increases risk. Balancing innovation with safety can be challenging.

An example of this conflict is the Internet of Things (IoT). While the IoT provides incredible opportunities for site monitoring, predictive maintenance, and supply chain optimization, data privacy and security regulations may impact implementation.

A ReliaQuest Cyber-Threat Report recently ranked construction as the most targeted industry.

The best solution to combat risk is not to avoid transforming but rather to take steps to prepare for and defend against threats. Most cybercriminals select targets based on accessibility, so investing in cybersecurity infrastructure and educating staff members can significantly help construction companies ward off these bad actors.

Whether you are transitioning from an on-premise system to the cloud, adapting to modern work, or concerned about the security of sensitive data, there are simple and effective strategies to safeguard your cloud environment.

AI & Automation

Many construction companies are looking for solutions to increase productivity, make teams more efficient, and reduce rework. AI and automation (or, even better, AI-enhanced automation) can offer promising opportunities to reshape how the construction industry operates.

Consider this: Construction decision-makers believe one of the most effective strategies for increasing profitability is to improve project pricing and enhance the accuracy of estimates.

AI can analyze large quantities of historical data from previous projects, including material costs, labor expenses, and timelines. By identifying patterns and trends, AI can predict future costs with greater precision. Additionally, machine learning algorithms can be trained on extensive datasets to create cost prediction models.

Implementing generative AI also allows organizations to streamline processes, reduce manual workloads, and enable employees to focus on tasks that require creativity and critical thinking. This shift drives innovation and growth, helping construction entities remain productive and efficient despite labor shortages.

Even so, organizations must take careful and strategic steps to harness AI effectively. From preparing your data to defining business objectives and establishing a plan for change management, successful AI implementation must start with a plan.

Technology Optimization & Combination

With economic volatility causing many construction organizations to analyze their current costs, many are reassessing their technology investments.

According to a survey by Procore, 22% of construction professionals feel they need to evaluate their existing tech stack, and 23% want to consolidate their investments to lower costs.

To better understand the impact of your current technology investments, consider the following:

By taking these steps, construction industry leaders can systematically evaluate their technology investments, identify opportunities for optimization, and make informed decisions about consolidating or adopting new solutions.

Moving Forward

While leveraging modern solutions to address challenges is crucial for long-term success, construction entities must first develop a comprehensive digital strategy. A reactionary approach focused on quick fixes and imitating competitors will only result in technical debt and convoluted data.

An advisor can assist in developing a roadmap for strategically applying technology across your organization. At Eide Bailly, our team combines business acumen with technology expertise to help organizations of all sizes integrate solutions into their business processes in a strategic and methodical manner.