Should current global crises be considered as challenges or opportunities? Are construction companies merely holding their heads above water, or should they be seeking to regain control?
The digital tsunami is a phrase that's increasingly being used to describe the torrent of data being generated by and thrown at companies, with the expectation that they will somehow make sense of it all. And the digital tsunami is just one of many challenges that the construction industry is currently faced with. Others include skill shortages and health and safety, evolving construction methods and the looming net-zero carbon debate, and critical issues rising from the current pandemic and Brexit such as material shortages and rising prices.
Riding the digital tsunami is an apt metaphor for dealing with the wealth of information we have available, and which we should not be afraid of using. Properly managed, all of the issues we are coming across can be addressed and problems mitigated. That is the role of Access Construction, whose ERP and estimating software gives project managers the information they need to make those critical decisions, but more importantly, presents it in a meaningful way that shows the impact they will have on a project's profitable outcome.
MATERIAL SHORTAGES Let's look at the shortage of building materials, which happens to be one of the most widely discussed issues at the moment. The COVID pandemic is being blamed for some of this, but there are developing problems with all different types of materials. There is an increased global demand for steel, for example, and British Steel for various reasons is not accepting new orders. Increased growth in infrastructure projects is hoovering up current supplies.
Timber is increasingly being used for environmentally friendly construction projects, which is going to hamper the hoped-for increase in housing projects. The shortages in usable plastics, such as polyethylene and polypropylene, is suffering from an increased global demand incurring raw material shortages - resulting in price increases.
To put it bluntly, construction companies can no longer rely on the goodwill of suppliers, fixed prices and scheduled delivery dates. Tenders should not ask for fixed price bids, but should be based on inevitable price fluctuations and the changing market circumstances that trigger them. Keep your head to the ground and you will know when or what shortages will occur or are occurring, and you can feed that into your project budget's 'what if' scenarios to gauge the impact on your cash flow or profitability.
There's a more serious issue here though - force majeure. The contract you have with your supplier should be tagged as a contract relevant event, insulated against contractual penalties and insured against associated losses and expense. Speak to Access Construction before you send out your next round of tenders and ensure that bids accepted and contracts raised cover all legal and financial obligations. Remember also that your supplier is a partner, and is likely to be suffering the effects of adverse market conditions as much as you are.
MODULAR CONSTRUCTION The demand for modular construction is an opportunity rather than a challenge. It has ramifications for the supply chain, project planning and scheduling, sustainability and skill shortages. The shortage in raw materials will probably be felt by building component manufacturers as hard as building contractors, but volume manufacturers will be able to stockpile materials in larger quantities and, consequently, pre-order materials which can be processed and delivered to contractors on a just-in-time basis.
This means that builders can more or less guarantee pre-manufactured components when they are needed and use fitters, rather than craftsmen, to erect them. Once again, Access Construction job costing utilities can be used to compare costs against traditional methods of construction, incorporating component delivery and resource costs to provide more accurate budgets and project costs.
Modular construction is also at the forefront of the drive towards the country's net-zero carbon targets. They have the facilities and the need to research alternative materials, technologies and building methods. Building contractors on tight margins focus on the projects in hand. It is essential that architects and engineers, faced with governmental pressures to reduce carbon emissions, speak frequently to off-site fabricators to keep abreast of developments, and the driving force for this must be the opportunity to reduce a project's construction costs,
SKILLED LABOUR SHORTAGES Skilled labour shortages result in poor productivity, rising costs and dwindling profitability. Although Brexit has been cited as a contributing factor, it is a global problem, with an ageing workforce, poor training programs and the nature of the job, which is felt to be poorly paid and dangerous (numerous surveys point out the construction industry's poor safety record). Skills don't necessarily just refer to the ability to lay bricks professionally, but also to the processes and workflows on a building site. Incompetence in this area leads to work not being carried out properly and procedures missed.
The obvious outcome is that the quality of construction on the project is lower than it should be, and the tagging of defects and the remedies required to clear them becomes an expensive and unforeseen addition to the project's costs.
Communication between the team on-site and in the office is critical, therefore, to both direct and monitor the daily activities of the construction site: the comings and goings of employees, the recording of material deliveries and the ordering of equipment, and the commencement and completion of tasks.
Besides recording costs on a real-time basis, updating employees timesheets, even checking whether a particular employee has the skills to do a particular job, the information can be used by Access Construction to compile reports that can be analysed to discern trends and unearth reasons why particular aspects of projects tend to go astray.
Should tagging reveal that, for example, light fittings have been installed incorrectly on a number of occasions on a building site, checking the appropriate report will reveal which contractor and employee was directly responsible, and to allow them to remedy the situation.
Access Construction's mobile application is used to maintain direct control over the activities on a construction site, but it also helps empower the local foreman using it, making them a more important and valuable member of the team.
DEALING WITH THE UNEXPECTED There is nothing so certain as death and taxes. The world is in flux, and many things will change over the next couple of decades: high tariffs on imported raw materials (Chinese steel), evolving transport and electricity supply technologies, migrating populations, changing work patterns and more. Governments will have to define the rules that govern our responses.
The signs are there already, and the information is flowing. Access Construction has the responsibility of keeping track of such changes and keeping clients in touch with how it affects them and their business. It's your responsibility to take advantage of their expertise.