What is the potential risk to a contractor that does not have formal cybersecurity policies and procedures in place?
Mike Ode
Chief Executive Officer
Foundation Software
Without cybersecurity measures, you put your company and your employees at risk. Protecting sensitive information should be a priority for any contractor managing a business. Enforcing these security procedures can help mitigate threats like data breaches, phishing, ransomware and more.
Let’s consider a data breach: Cyber criminals infiltrate your company’s software and steal routing numbers and personal information. They then pose as someone within your company to try and exploit the situation for money or information. Having even a basic plan in place, with cybersecurity insurance and standard trainings included, can reduce the chance of these incidents occurring.
There are a variety of ways to keep your data safe. For example, using a cloud-based system like SaaS can eliminate the misplacement of information. And a multifactor identification system notifies account owners when logins are attempted. Cybersecurity insurance can also ease your nerves, covering your business liability in the event of a breach. And training your employees on how to spot and prevent cyberattacks protects your company at every level. Ultimately, keeping up with security trends will help you establish new ways to protect your data against hacking.
Why is it important for construction businesses to revisit their prequalification process?
Julian Xavier
Managing Principal of Industry — Construction
CLA (CliftonLarsonAllen LLP)
A robust prequalification process has always been one of the best ways for a contractor to protect financial health and help projects perform efficiently and profitably. In today’s construction environment—with numerous challenges around materials price increases, supply-chain issues, shortage of labor talent and rising interest rates—the prequalification process is more critical than ever.
The prequalification process is used to select subcontractors and identify red flags that might lead to issues with timeliness and quality of work. Traditional prequalification methods that focus on balance sheet ratios and historical performance are still important, but in the current environment additional information and discussions should be had with the subcontractor to help mitigate risk.
Key questions should be asked around their ability to procure materials on time and within prices included in their bid, their ability to maintain labor forces, the health of their cash flow position and their projected work schedule over the next 12 months, etc.
Additionally, given the rapidly changing construction environment, the prequalification process should not be a one-and-done exercise. Ongoing conversations and monitoring should be held with the subcontractor to verify their continued financial health and ability to perform on the project.
Upping the prequalification process will take more time and effort. However, mitigating the potential risk of a major subcontractor default can provide greater security and confidence that selected subcontractors will be able to perform and manage their way through unforeseen obstacles.
How can technology help contractors manage payments to subcontractors?
Mike Milligan
Chief Growth Officer
GCPay
Managing cash flow in this economy has become all the more critical right now, which probably doesn’t come as a surprise. However, what might come as a bit of a surprise is how much currency exchange takes place on a typical project between the general contractor and all of its subcontractors. Did you know that, on average, it’s over two-thirds of the cost of a project’s total? That’s a lot of cash flow to manage, both incoming and outgoing. Making mistakes is not an option, and double-entry accounting processes not only can contribute to mistakes but are a time-intensive and painstaking way to invest serious energy.
Paying subcontractors for their work also requires what seems like endless amounts of paperwork, from compliance documentation to lien waivers. Did you know that just this part of subcontractor management can take the equivalent of two working days a week? It doesn’t have to. Managing subcontractors and paying them on time, every time, can be much easier.
That’s where GCPay comes in. GCPay is a cloud-based software application that is integrated with today’s leading construction ERP systems and manages this entire process—from collecting contracts and managing compliance and lien waiver documentation, to paying subcontractors for work throughout the life of a construction project. It can even pay subs electronically if so desired, all the while eliminating mistakes and double-entry accounting processes.
Managing cash flow, especially the payments between you as the general contractor and all of your subs, has never been easier. Or more efficient!
What advice do you have for contractors that are still using spreadsheets to manage their businesses?
Joel Hoffman
Director, Product Management (Construction, Field Service, Property Management)
Acumatica
Today’s construction industry is rapidly evolving—with new technology, complex projects and shifting customer demands. To be profitable, contractors have to track key metrics and accurately forecast/manage job costs, cash flow, change orders and more. Data must be precise, and project information should be easy to find. So, relying on manual data collection methods—like spreadsheets or even pen and paper—can turn modern construction management into a nightmare.
Manual processes worked when the world was less digitally connected. Supply chains weren’t global. Customers didn’t expect to instantly connect with their contractors for updates. A website was a nice feature, not a functional necessity. But those days have passed, and manual construction management methods just can’t get the job done anymore.
Contractors should use construction management software across the entire project lifecycle—from financial and project management to field communications and beyond. It will keep them from analyzing and making decisions based on data that is out-of-date or skewed by human error. It will keep them mobile, connect field workers to the office, integrate the entire supply chain, give customers access to self-service portals and keep the business running like a well-oiled machine.
What are the telltale signs that your current construction software isn’t getting the job done?
John Rosch
North American Sales Manager
Explorer Software
Construction software is an essential tool that helps builders and contractors streamline their workflow, manage projects and optimize their resources. However, there are some warnings that your current construction software isn’t meeting your needs, leading to frustration, inefficiency and costly mistakes. Here are some telltale signs that your current construction software isn’t getting the job done:
Over-reliance on Excel: Excel is not designed for construction-specific tasks and can lead to errors and inefficiencies. Your construction software should be designed to store data and showcase that information in an easy and reliable way.Inadequate reporting capabilities: Accurate and timely reporting is crucial for monitoring project progress, identifying issues and making informed decisions. If your software lacks the reporting capabilities you need, you may find yourself spending valuable time manually creating reports or not having access to critical data when you need it.Lack of mobile support: In today’s fast-paced construction environment, workers need access to project information on the go. If your software doesn’t offer mobile support, it can limit the ability of workers to access information from the field, leading to inefficiencies and communication breakdowns.Lack of integration: Your construction software should be able to integrate seamlessly with other software programs and tools you use. If your software is unable to integrate with other tools, you may find yourself wasting time manually transferring data from one system to another.
If you are experiencing any of these issues with your current construction software, it may be time to evaluate other options that better meet your needs. A software solution that addresses these concerns can help streamline your workflow, improve collaboration and increase efficiency, ultimately leading to better project outcomes.
What are the key benefits of workforce management technology?
Ryan Meitl
CEO
RIVET Work
Labor is one of the largest cost and profit drivers at specialty and multitrade construction contractors. In today’s tight construction labor market, it’s never been more important to maximize labor resources. Labor operations and workforce management software can help by enabling your most valuable people to work “on the business” rather than “in the business”. Ops leaders (operations directors, VPs and superintendents) are some of the most knowledgeable and experienced staff at construction companies, but spend most of their time on non-value-added administrative tasks. Workforce management software offloads many of those administrative tasks.
Also, software ensures business continuity when staff inevitably go on vacation or retire by bringing important business information out of the heads of a few key people and into a database accessible from anywhere.
Additionally, workforce management technology can optimize labor utilization. Too many people, too few people and the wrong people all add to margin fade. Workforce management and labor operations software ensures that your business is properly staffed for the work you’ve won, and that you have the right people staffed on each job.
Is the industry ready to employ AI, machine learning and analytics?
Varsha Bhave
Founder and President
Projectmates by Systemates Inc.
The industry is absolutely ready to employ these new technologies. At Systemates, we’re working with innovation lab developers from Hexagon, our parent company, to create new AI-enabled tools for our Projectmates construction program management software. The goal is to glean important information from documents without a user ever having to open them. Instead of wasting time rifling through these documents, AI will be able to find and organize the exact files you need in a fraction of the time. This is the kind of schedule-saving functionality that construction professionals are clamoring for.
And AI-enabled innovation won’t just improve the office.
Hexagon already uses AI for detecting site workers, site equipment and site safety measures to ensure everyone is where they need to be when they need to be there. Digital technology has already enhanced construction efficiency. Harnessing the power of machine learning and AI is going to kick efficiency into overdrive.
