It’s generally acknowledged that the future of construction lay in technology, software in particular. There are a lot of software options to adopt out there, though, with most focused on a single construction business function. Do any standout? More than half of respondents to the InEight Global Capital Projects Outlook ranked construction estimating as being the most important category to invest in to support their future success.
That’s pretty understandable. There’s a lot riding on estimates — budgets, project performance and profit margins. Where this may be most noticeable is when a company is focused on capital projects or in expansion mode. It’s for these companies in either or both of those scenarios that a more robust option may compel a bit of exploration. That option? An integrated platform.
Why is an integrated platform option worth exploring and deploying? That’s what we’ll take a look at here.
Dramatically improve quality and accuracy of estimates
Construction estimating has long been an inexact science. What starts out as a well-intentioned effort toward accuracy almost always ends with costs and schedules far exceeding their original estimate targets. This can partially be attributed to incompatibility issues among the different siloed solutions many construction companies have adopted — such as estimating, scheduling and contract management. Not only is each business function working with its own set of numbers but sharing and updating data becomes more problematic. Every time there’s new or changed information, that data has to be reentered in each of these solutions. It’s not only time-consuming but it increases the likelihood for keystroke errors, which then lowers confidence in the accuracy and quality of the data.
By contrast, construction estimating within one integrated platform reduces the possibility of these errors and inconsistencies ever occurring. The data from each step instead flows seamlessly into the next step without encountering missing or omitted pieces of information that can lead to cost overruns at a later stage in the process. With more reliable data a more realistic estimate is achievable.
Streamline workflow from one source of truth
An integrated platform acts as a single source of truth. With estimate information such as pricing data and labor rates stored in one database there’s no risk of those details getting lost in someone’s computer files or delayed due to issues such as emailing spreadsheets back and forth. This single source provides one consolidated view of the project that improves visibility into costs and schedules, something that has eluded the capabilities of disconnected solutions. Users can see how changes affect the construction estimate in real time so they know what impact they will have on schedules and budgets before they make them.
This in turn creates a smoother workflow with none of the inefficiencies caused by multiple tools working separately on different steps of the process. With less time and effort spent on overmanaging data that has to be reentered, corrected or recalculated, there can instead be more focus on how that data is used to better estimate projects.
Share the same data across business functions
Companies that have thin margins and tight budgets often run into one major problem when it comes to creating a construction estimate — lack of communication. Because it’s not just the estimator who has a hand in creating estimates. There’s engineering, accounting, purchasing, scheduling and project management, for example, and each has its own priorities and approaches. There is no way to properly integrate this information without the proper technological solution in place for sharing vital data across the whole team.
Using an integrated platform allows everyone on these business units to share information quickly and easily among each other without having to use separate applications or emails. This saves time, money and frustration by eliminating duplicate work and emails. It’s not just a matter of sharing information, but ensuring each department is able to contribute their expertise and knowledge to the process. As such, they become more of a collaborative unit, able to make better, more-informed decisions about the project from the beginning as the estimate takes shape.
Extend projected and real-time risk management
A well-known challenge with construction estimating is incorporating the unpredictability of work and materials into the final estimate. And yet, no estimate is complete without addressing risk. This is where incorporating past project data comes in.
Taking the integrated platform approach, the information that business units generate and use shares a common data structure they all can interpret and draw insights from. Those insights, condensed into cost performance (CPI) and schedule performance (SPI) metrics, are meant to show real-time financial and timeline efficiency. But these metrics can be used in a predictive way to more easily identify past internal and external risk factors that are likely to occur and then apply their measurable impact to current estimates.
Relying on this connected data helps answer key questions that will affect the final estimate: How did those risks affect costs and timelines of similar past projects? Did contingency plans work to mitigate those risks? Will these risks likely affect the current project and how can this inform better resource planning? How can the business units collaborate on risk-adjusted contingency plans that can be incorporated into estimates?
Gain more certainty for a competitive advantage
Construction estimating within an integrated platform delivers more than the above project-related advantages. Combined, they deliver a level of estimate certainty that construction companies relying solely on point solutions aren’t able to provide. Of course, point solutions are very popular in the construction industry, and they’re definitely efficient for their intended functions. But from a business perspective, there’s a strong competitive advantage to be gained by transitioning to an integrated platform. It gives construction companies the ability to pivot, to be more responsive as scope is modified or details change. That can make a huge difference when estimating for complex capital projects that come with higher price tags, longer build schedules and more risks. There’s little room for error on these projects. An integrated approach can provide the more accurate, reality-based, risk-adjusted estimates project owners want, and therefore a higher level of cost certainty that simply can’t be achieved otherwise.
The industry is slowly but surely headed in a clear direction with integrated platforms like InEight integrated project controls platform, that comprise the construction business functions necessary to build successful capital projects. Of course, the end goal starts with a well-informed estimate at the beginning. That’s why the importance of integration can’t be understated. We’re happy to show you how construction estimating, combined with other business functions, can improve not just workflow but project outcomes.
