Construction Companies: Move to the Cloud or Risk Getting Displaced
A recent article on Forbes discusses the cloud and digital strategy for the construction industry. The author contends that construction must make a profound digital transformation over the next few years, spurred on by help form the cloud. This is not only because of the COVID-19 outbreak, but simply because the industry must find a way to be more agile.
As we have seen in previous research from McKinsey on the construction industry, it is among the least digitized and that includes use of the cloud. This lack of digitization is the primary reason that McKinsey ascribes to construction’s regression in productivity.
Here is an excerpt:
Too often we hear the argument that digital transformation is only for digital companies.
Consider the field of construction and building maintenance. Two years ago, a survey by Ernst & Young of companies along the engineering and construction value chain (including general contractors, designers, developers, and companies focused on infrastructure, building materials, and engineering) showed that only 25% of respondents had a clear digital transformation plan in place. That’s a fairly shocking number for industries of this size. The construction industry alone employs more than 7 million people and creates $1.3 trillion worth of structures each year, according to a report by the Associated General Contractors of America, the leading association of the industry. This means that businesses that can put together and execute their digital transformation plan are in a good position to disrupt a market that’s slow to adopt modern technologies like cloud computing.
Many transformational opportunities exist for construction companies that embrace the cloud, including, AI, IoT, smart building and digital twins. However, these are the fancy new things.
One place that the cloud can make a significant productivity difference for construction companies is in the back office. Most construction project processes are not digitized, let alone consolidated so that they work together seamlessly. They need a real enterprise construction ERP.
A major opportunity for construction companies adopting cloud technology is the ability to consolidate their disparate point applications into one comprehensive business system. This integration possible with the cloud can transform business processes for these companies. Insights that used to take days or even weeks to produce are now available instantly.
That is what Project Business Automation does for construction. PBA creates construction business software platform on which project-based companies (e.g. construction) can run their entire business. PBA offers construction companies the chance to disrupt their competitors.
Jumping into the cloud with a full-fledged system to support your entire business may not seem revolutionary or like a competitive advantage, but it is for construction.
Matt is the CRO for Adeaca and is on a mission to create the Project Business Automation category in the market. He is leads Adeaca's thought leadership in project business. He has significant experience in high-growth ventures, helping companies gain awareness and position themselves as leaders in their industry.
