Why has Construction Technology not delivered on its promise?

What Construction Leaders are not saying out loud

Why has Construction Technology not delivered on its promise?

I am very fortunate to have many of the ENR 500 CEO’s as investors, clients and friends. They continue to seek counsel on their technology investments.They continue to spend more and more every year, including hiring more and more innovation team members. In general, why do most of them say that the return on these investments have been nominal? First off, they don’t say this in public. It would be detrimental to their marketing image for recruiting, attracting clients, etc.Now there is a scramble to evaluate deploying AI (Artificial Intelligence). As a venture capitalist, I see all the latest technology in Construction including AI, robotics, prefab, etc and provide my insights via this newsletter, podcasts, books, etc. We also are a voice for leading building owners/developers through our IOF organization. Learn more about me here. Let’s dig in.

System of Record Software

Many firms have heavily invested in Autodesk, Procore, Builder Trend, CMIC, etc to manage their projects and company. The reality is that these software packages are not used as a “single source of truth” to manage projects. They have become archival systems for the people that run projects to input data (because corporations make them) after the fact. In reality, projects are mostly managed via spreadsheets, email and text messaging. Then this data is given to a project assistant to be input into the System of Record Software. Tell your teams that they can no longer use email or spreadsheets and see what happens.

Too much software

With the pervasive “Contech” community at large and the amount of funding that has been provided to startup founders, there are new apps being built every week. Many of them share similar features and many of them are just trying to fill in gaps from the System of Record Software companies. In my Construction Innovation Leaders Group, these leaders find that their biggest challenge is evaluating all the new software that is being developed and then trying to deploy them on projects. While the expense to buy all this software isn’t trivial, deploying all this software has a cost to project teams that aren’t focused on technology but rather focused on delivering projects on time and on budget. We just released a 400+ page construction software research project that is free to download here in our White Paper Library

There is not a single workflow

Much of the software that exists is focused on managing project workflows.The fallacy is that every project is the same and that the workflow is the same every time. Most contractors not only have to manage their own workflows, but they also have to manage within the workflows of others. Like I always say, design and constructing a building is less like manufacturing and more like making a movie. It is a temporary structure to execute a project and then afterwards, everyone leaves to work on the next with a new set of directors, actors etc..

Real Time Communication Doesn’t Happen in Software

Most of the software being used is where people record project information after the fact of it occurring. Real time information doesn’t happen in software, it happens via phone, text and email. This means that managing project risk happens outside of software and is managed by people that have access to very poor information. Technology is great, but if it isn’t helping your people make decisions then it is just an archival system.

The Construction Drawings are not everything

While Construction Drawings are very important, it isn’t the only important set of data to manage construction. Along with specifications, schedules, staffing models, etc. A construction manager has to use so many different sources of data that are not connected and also have a constant version control problem. Keeping up with the changes of all this information and how it changed is a black box left for construction managers to decipher.

Too many tools, not enough benefit

As more and more tools come to market, it is becoming even more important that Construction Managers evaluate the ROI of these tools and how they work in their current workflow vs being forced to change workflows to use the tools. How is all of this innovation creating a benefit? I have a free assessment tool that I have created for Construction Executives (especially CFOs) to assess themselves against their peers. Check out DIAL

Later this month, I am hosting a couple of events at the Hensel Phelps Innovation Center.

Vibe-a-Thon : Roll up your sleeves and let us help you build your own software. Yes, biggest benefit of AI is for non-coders to build their own software.

My 9th Annual AEC Summit: Me and my team will tackle the above topics and many more. Including the flow of venture capital into the AEC industry.

Do you want to collaborate with people like yourself?, join our Catalyst Program. It’s a free program that we run to share everything technology in the AEC industry.