The Money is Made in the Field
The goal of the article is to change your perspective that Headquarters (HQ) is not the center of the construction universe. In fact, the center of the construction universe is the field office because that is where the money is made. Whether you run a heavy civil general contracting firm or a specialty subcontracting company, revenues are generated based on the number of employees working in the field, and on how well projects are managed. Human resources and project management are both executed in the field, therefore the priority of any construction business is to acquire real-time information to enable effective and efficient management of company assets and resources to generate cash, acquire new business, and deliver profits. When real-time information is captured from the field office, the right information can be delivered at the right time to assist management in making informed business decisions.
The challenge today is that construction projects are carrying higher levels of risk, shorter time-to-completion goals, and are returning lower profit margins. In response, many construction companies are resorting to performing more jobs, which require more resources, create higher levels of risk, and generate twice as much information in order to achieve the same financial results as in years past. Making matters more pressing is the urgency to properly manage cash flow. Without cash flow, the ability to bid on new projects is impossible. Effective management lies in a technology strategy that incorporates the economic realities, the reliance on real-time data, and an understanding that the money is made in the field™.
• Managing Cash Flow - billing percent complete vs. cost
• Project Information - entering field and safety reports in the field
• Employee Time - capturing employee time in the field
• Asset Information - tracking usage of backhoes and other equipment
The common thread for all the business challenges is that they occur at the field office. Each and every challenge can be effectively managed if the information about the activity is captured in real-time.
Mobile office trailers serve as a physical office in the field where General Contractors (GC’s), engineers and owners come together. The same should be true for all technologies. It is the trailer that should provide the underlying technology systems that will serve as a platform for employees to connect to, software systems to run on, and tracking systems to communicate through. The SMART Trailer is simply a trailer fitted with a high-speed dedicated Internet connection, equipment to provide a wireless network to the entire job site, an array of smart devices, camera’s, and smart sensors that connect to the wireless network and communicate vital information back to Enterprise Resource Planning (ERP) system.
The high-speed Internet connection and wireless network are the foundation for developing a SMART Trailer strategy to capture vital business information in real-time. The strategy can be replicated for each and every field office. The following examples of technologies all connect to the physical or wireless network in the trailer and show what is possible today in the field:
Wireless Point-to-Point High-Speed Internet Connections - Wireless systems do not require a physical connection to obtain Internet connection. In essence, a trailer can be placed anywhere and still have a high-speed Internet connection.
VoIP Phone Systems - The days of waiting two months and bearing the cost to have a service pole installed are over. Today, Voice over Internet Protocol phone systems allow a construction company to rent the exact number of phones required on per month basis. The phones only need an Internet connection to work.
Mobile Devices - mobile devices for engineers in the field offer a host of communication options. If a wireless network is ubiquitous on a field site, the need for purchasing and paying for a monthly data plan is not necessary. In addition, the mobile device can leverage technologies like Skype to make phone calls through the wireless networks, engage in free video conference sessions through Google hangouts, or take advantage mobile field and safety report forms.
Employee Time Capture - Capturing employee time in the field is a priority for many construction firms combating the buddy punch system and workman compensation claims. There are software solutions currently available for mounting a tablet in the trailer (wirelessly) that connect back to the accounting and construction management system. The punch-in process starts with selecting the correct name, taking a picture of the employee, and requiring the employee to answer several questions about the day like: Did you work a full 8 hours? Did you hurt yourself during the shift? Did you take lunch? Appended to the punch in information is the GPS location and field office information, which is then transmitted in real-time to the accounting system.
SMART Devices - Are devices that perform a function and are connected to the wireless network to allow remote control and notification. An example of a SMART device could be as simple as a remote control thermostat, or a trailer door lock that sends a message upon entry to the trailer. The most functional use is the remote unlock function when a Project Manager forgets to leave the keys to open the trailer.
SMART Sensors - Are similar to SMART devices, but differ because there is no control. Sensors allow proactive management or tracking of assets within a domain. For example, the water cylinder that provides water to the bathroom in a trailer can be monitored. Once the water level reaches a certain threshold, an email notification is send out to add water. Another example is the tracking of tool boxes and products delivered to a site. Any box can be fitted with a micro Radio Frequency Identification (RFID) sticker which allows wireless tracking of those assets. Yet another example is Caterpillar’s wireless monitoring system, which provides proactive updates on the equipment.
Video Cameras - Allows two functions: 24/7 monitoring of all field offices, and the ability to take the video footage and tie it to project management Gantt charts showing progress over a long period of time.
Integrated Accounting & Construction Management Software – This is arguably the most important aspect of the entire strategy next to the Internet connection. The system is commonly referred to as an Enterprise Resource Planning (ERP) system (vendors like AccuBuild, ViewPoint, and Maxwell offer solutions), and is used as a central repository for information about the entire construction process. If the application is not available to the field office through technologies like Citrix or Microsoft Terminal Services, then nothing else matters. The ERP system is interconnected with every aspect of the business and needs to be available on every device.
By employing the right strategy and technologies, acquiring data from multiple field offices and aggregating the information into a software system will greatly increase the firm’s effectiveness and efficiency in everything from managing cash flow to productivity and profitability. The power of changing your perspective to reflect the realities of construction, one in which the money is made in the field ™ manifests itself in the types of questions asked, the strategies employed, and the technologies selected to capture the necessary information. The focus is no longer on the HQ but on acquiring information from the field in real-time to assist management in the HQ to make decisions better, faster, and smarter. That is a competitive advantage.