Revolutionizing Construction: Empowering Change Through Process Improvement

By: Christian Burger | President and Founder

Note: This article first appeared as a guest byline on January 15, 2024 at Enterprise Viewpoint at https://enterpriseviewpoint.com/revolutionizing-construction-empowering-change-through-process-improvement/.

The appetite in Construction for better data, analytics and more controlled risk has never been stronger. Contractors have struggled over the last couple of decades trying to get timely and accurate information into the hands of those who need it, whether it be executives, project managers (PMs), or even supervision in the field. For a time, the problem was systems and technology not being able to meet expectations. For some organizations, the problem was compounded with adoption and compliance, people not filling out time sheets accurately or requesting material via a purchase order (PO). While technology has made tremendous advances in the last five years, organizations are still struggling with accessibility, timeliness, and accuracy of information.

The influx of new solutions, better technology (e.g., middleware), and the emergence of tech-savvy workers has alleviated many of these problems. However, the process standards and compliance problems persist. And while that obstacle is not easy to resolve, there is a solution available to all construction firms, both large and small…a focus on process improvement. 

At the end of the day, all contractors regardless of type and size have to do many of the same processes. They all must bill for their work, pay suppliers, budget work, record time, order materials, forecast cost at completion, etc. These processes, when properly automated and performed, yield a wealth of information from which important indicators are derived and valuable lessons are learned. This article will briefly focus on how to create a process-oriented culture and manage change within the organization.

To begin, a firm should establish the top ten (or so) key business processes; those that will either make the most difference to streamline, yield most valuable data, or inherently need to be controlled very carefully. Not all processes have the same basis for improvement; some carry more risk, while others are high-volume). Once the top ten are identified, a small team can be assigned to the task of process improvement. This is not an IT-led initiative, but rather led by the business. IT will certainly play a role in automation, yet it might not necessarily drive the identification of these changes.

For the remainder of this article, we’ll use the Procure-to-Pay process as an example. This process starts with estimating and the development of a bill of materials (BOM) or series of subcontractor quotes. It then progresses through contracting and issuance of POs, receiving, change orders, invoice and draw processing, and finally, payment. In order to do an effective job of process improvement, you need to examine the process from beginning to end, not just a siloed view which is artificially broken up due to departmental structure or systems involved.

Once the team has been created and assigned a process, they can begin the work of documenting the current workflow. This often involves a business process management (BPM) solution like Visio or Lucid Chart. The team should focus on documenting the current process(es) all the way through including roles, approvals, and systems involved. The Procure-to-Pay process could involve multiple sheets in order to capture the end-to-end state. Once complete, the team and management can carefully analyze the process and all of the various inefficiencies and risks such as spreadsheet use, double entry, lack of workflow, and control. Once there’s a consensus on the current process and where the issues reside, the team can initiate efforts to streamline. This would involve going back to the BPM solution and drafting the ideal to-be state. The following table presents some of the more common problems associated with a given process along with potential solutions.

If the company has many legacy systems in place, lacks middleware or other integration solutions, or does not possess all the necessary IT resources to keep pace, the company may realize the need to transition to a newer solution overall. This would not be an easy decision but one that would be made if a number of key business processes are hindered by older non-integrated solutions. Historically, firms were fond of putting many ‘Band-Aids’ in place, making small incremental fixes to a system rather than stepping back and looking for a more holistic approach.

Once a new solution or multiple improvements are identified and then implemented, the team can begin developing proper training materials for the new process. The training should be focused on which systems to use, how to use them, and why the process is so important. The team can then monitor the improvements and eventually close out the initiative. Another team can start work on the next process. Many organizations designate one person or perhaps a pair of people responsible for a given process (e.g., Process owner) and task them with monitoring the process’s health continuously. And don’t forget to celebrate the team’s accomplishment and use that result as a template for the next process.

Many organizations are saddled with processes that have ‘always been done this way,’ with little or no examination or desire for process improvement. Some people aren’t even aware that they have agency and can change things. Developing a strong culture that embraces change goes a long way toward more efficient, reliable processes and a high-performance organization.