Construction IT: Top Ten Trends for 2024

By: Christian Burger | President & Founder

Any list of Top Ten Technology Trends is subject to variables such as contactor type, size, and the level of ambition. However, these ten trends are carefully chosen based on what the market seems to be focused on. They are not necessarily in priority order. Enjoy the read, check the list, and if you are current on six or more of the ten, keep doing what you’re doing. If you scored lower than five, consider upping your game and giving us a call.

Enterprise Resource Planning

Many companies that are on older client/server enterprise resource planning (ERP) solutions are examining the extent to which these solutions are hindering their progress and evaluating their alternatives. There have been a few new entrants into the Constriction ERP market space and a couple of older solutions that have made significant platform moves over the last ten years to keep pace.

Burger Consulting Group expects to see several thousand construction firms
migrating to newer platforms better suited to their long-term needs over the next five years. This migration will strain many software firms and value-added resellers (VARs) who support these products. Contractors are also utilizing this transition to evaluate business processes, adopt best-in-class strategies, and achieve better integration.

Project Management

Many contractors have automated their project management (PM) platforms, often using Procore or perhaps AutoDesk Construction Cloud. Some have successfully integrated these with their current ERPs. Many general contractors are experiencing good adoption within their organizations and even among their subcontractor communities. However, the complexities and frustration for subcontractors when working across multiple platforms are significant. They are trying to determine how to consolidate data and documents from various owners and general contractor platforms into their own platform for accessibility and safekeeping.

Precon

Estimating, scheduling and buy-out functions, as well as building information modeling (BIM) and virtual design and construction (VDC) are all receiving considerable attention now. This is another area that will experience significant advancements in the next several years, as it is burdened with legacy technology (e.g. on-premises/client-server systems). Contractors are transitioning to subcontractor prequalification and invitation to bid solutions, opting for more suitable and scalable estimating solutions (i.e. moving away from spreadsheets).

Self-performing contractors are striving to better align their estimating solutions with costing and field productivity functions to ensure improved reporting and historical cost accuracy. Some larger contractors are beginning to implement procurement solutions that offer extensive marketplaces for acquiring materials at better prices. This is also helping to alleviate the supply chain disruptions that COVID created.

Safety

Safety has always been a priority in construction, thankfully. Some firms excel more than others in tracking incidents, training personnel, and providing personal protective equipment (PPE), among other aspects. Most firms have some level of automation in place for tracking these safety measures. There are plenty of good solutions available in the marketplace. However, Burger Consulting Group observes contractors integrating HR platforms, where training
administration and content are stored, with inspection systems to better align training requirements with training content and activities.

Human Resource & Payroll

Many contractors have either shifted to stand-alone human resource (HR) platforms or are currently in the evaluation phase. This is leading firms to also consider outsourcing payroll, either integrated within the HR platform or as a separate entity. However, this remains a challenging transition, particularly for multi-state, union contractors, and those involved in jobs requiring prevailing wage reporting. Construction payroll involves high nuance and complexity.

Most of the vendors entering the construction sector with hopes of managing payroll did so either naively or underestimated the complexity. Firms are also prioritizing training, particularly the storage aspect link a learning management system (LMS). While there are good LMS solutions available, content creation remains a challenge for many firms.

Scheduling

Burger Consulting Group has observed an increased emphasis placed on scheduling. Many firms still use P6 or Project, depending on the owner’s requirements, but they are improving in maintaining schedules. Some firms are hiring scheduling engineers to assist their project management staff in developing and maintaining schedules throughout projects. Certain firms encounter claim situations that necessitate support with detailed schedules. Additionally,
Burger Consulting Group notes the integration of PM solutions with schedules to connect scheduling activities and dates to functions tracked within PM solution (e.g. submittal dates). Contractors are also using schedules more frequently to load resources and manage staffing over forecasted backlog.

Document Storage

Enterprise content management (ECM) solutions are being deployed at a greater frequency in the industry as contractors realize the value of having their digital content stored safely, accessibly, and permanently, in conformity with the records retention policies. This can be in SharePoint or more purpose-built solutions like M-Files or OnBase. Contractors are recognizing the risks associated with digital content being saved in numerous systems, some of which they don’t even control. For reasons of audit, production, claims, and compliance, contractors are prioritizing this enterprise architecture and the related business processes. Middleware, also discussed here, can play a significant role in the capture and storage into an ECM solution.

Data & Analytics

Contractors have been hearing about data and analytics for several years now. Some have been experimenting with Tableau or Power BI but are quickly realizing the condition of their data is suspect and unreliable at best. This realization is actually a positive development as it compels management to focus more energy and attention on improving data quality and implementing middleware to help move and transform data into a proper data warehouse. Larger firms are beginning to emphasize data architecture more and are bringing on data analysts to prepare for the upcoming decade and the value of readily accessible analytics.

Integration

Many construction firms still have disparate, disconnected solutions, which are sometimes connected via a point-to-point integration or batch uploads from CSV files. Some are still double-key data from one solution to the next. Many firms will be transitioning to middleware solutions (e.g. Boomi, MuleSoft) over the next several years. This will require additional resources within IT or the hiring of a third-party firm to assist with the connections. Middleware typically wouldn’t be implemented for a single integration but can actually handle many.

Eventually, this will allow for the implementation of master data management (MDM), meaning masterful data will be maintained in one solution, housed in the middleware solution, and then shared with other solutions as needed.

Governance

The IT Steering Committee was an idea that has outlived its original design. Larger firms are implementing governance models to help management prioritize business transformation, process improvement, AND technology deployment.

Solutions should not be deployed just for the sake of automation or keeping up with the market. The governance model allows management to direct resources and strategy without getting caught up in the technical details of products and enterprise architecture. This ensures better alignment of tech strategy and staffing with the overall business direction and demands for change and technology.

Process Orientation

Thankfully, many contractors are recognizing the importance of business process improvement. This includes streamlining workflow, integrating systems, training personnel, and insisting on standardization. This is contrary to the way many firms used to operate in the past, but as firms have grown, management is seeing the limitations of this laissez-faire approach. To grow and scale the business, and to have better data available, contractors have to focus on process improvement. Sometimes this involves implementing technology companies already have better, rather than simply chasing some new solution that looks modern.

In Summary

The decade ahead will be an interesting one, busy for many construction firms and the software suppliers working here. The industry was lagging in technology adoption for many years, creating a large amount of accumulated technical debt. COVID woke everyone up, and now contractors are scrambling to close the gap, pay off the debt, move their organizations forward, and attract younger, more tech-savvy workers. This will place pressure on IT as they reengineer
their departments and skill set to meet the new demand.

Another trend to watch is the investment community. Billions of dollars have poured into the construction industry for technology in the form of startups, acquisitions, and growth. This trend surged five years ago and continued until late last year. However, these signs indicate this trend is slowing. This means newer startup solutions will need to prove viability fairly soon or see their funding evaporate. This puts pressure on contractors to be extra vigilant as they
evaluate various solutions and enter into multi-year SaaS agreements.

Burger Consulting Group remains bullish on the industry overall and the prospects of improved efficiency and increased productivity as a result of the changes. However, a degree of cautionand a measured approach should prevail.