Learn about business intelligence in the construction industry and explore different ways to gain actionable insights.
What is business intelligence (BI) in construction?
In construction, business intelligence is the process of collecting, analyzing, and applying relevant data to optimize performance and support continued growth. Using business intelligence software and other tools, a construction company will gather information about competitors, research industry trends, or assess internal operations and use what they learn to better plan business strategies and make more informed decisions.
When are the benefits of using BI in construction?
The main benefits of using business intelligence in construction are:
Increased productivity
Higher profitability
Faster growth
Increased productivity
Whether you’re busy on the jobsite or managing multiple projects from the office, it’s easy to get stuck in familiar workflows. Taking a step back and looking objectively at your business operations can reveal inefficiencies you never would have caught otherwise.
It’s also often helpful to research how competitors and peers handle aspects of the construction process differently than you do. You may learn new best practices.
Higher profitability
Using business intelligence to optimize performance will naturally lead to higher profitability through reduced spend and better-managed resources.
You can also mitigate the risk of projects going over budget by analyzing past performance and researching the current market before planning bids and estimates.
Faster growth
With a thorough understanding of industry trends, you can more easily plan for the future of your business. What areas of the market are growing quickly, and which are growing slowly? What cutting-edge tools and techniques are available? What features or value propositions are currently in demand for your target customers?
Employing business intelligence strategies at your construction company can help you answer those kinds of questions so you can better prepare for challenges ahead and adjust your strategies to maximize your potential.
How does BI actually work in construction?
It’s easy to get overwhelmed with data, but with modern tools, using business intelligence effectively as a construction company may be easier than you think. Follow these steps to get started.
1. Goal setting
First, determine what you’re trying to accomplish with your business intelligence strategies. Your goals may be general or highly specific, and you may be working toward more than one at the same time. Here are a few examples:
Optimizing your pre-construction process
Conducting research on local competitors
Creating a five-year business plan
Determining what roles to hire for the coming year
Assessing whether or not to expand your current services
Setting goals will help determine how you approach your next steps.
2. Data collection
Before you can take advantage of the data that’s available, you need to collect it. As a construction company, you have several options for researching and gathering key information.
Internal documentation
Review internal data to assess past performance and identify any operational issues that could be resolved. You can utilize daily reports, production data, work logs, time cards, photos, safety and quality documentation, sales data—whatever kind of information you have that’s relevant to your goals is valid.
It’s essential that your internal data is accurate. If you’re having a difficult time finding clear, consistent data, your first goal should be improving your reporting processes. Without accurate data, your business intelligence strategies will be less effective.
External research
To collect data externally, start with an online search. Reports posted by government websites, financial and consulting firms, industry publications, and other trusted resources can be used to gather facts and statistics about the current market or your target demographics. You can also research your competitors by reviewing their online content.
While there are many free resources, it can also be worthwhile to explore paid options, like construction-specific databases, which may offer deeper insight.
Third-party services
Many third-parties offer market research, competitor research, and other business intelligence services for the construction industry. These agencies often use dedicated software and other tools that are not easily accessible to your average contractor. This way they can provide detailed, high quality data that would otherwise be difficult to capture.
If your goals are especially complex or you lack the time and internal resources to dedicate to business intelligence, consider investing in this specialised service.
Using a combination of resources
You’ll likely rely on multiple data sources, depending on your goals.
For example, if you’re using business intelligence to determine whether or not to create a new quality manager position, you may review your own internal documentation to see if there are recurring issues that could be prevented with a greater level of oversight. In addition, you may also browse competitor’s websites or social media platforms or use a construction database to see how many companies of a similar size also employ workers in the quality manager role.
3. Data reporting & analysis
As you review data, you’ll need to organize and analyze it. What data is most relevant? Document what you learn and, most importantly, put it in context.
We’ll continue with the quality manager example. When you reviewed your internal documentation, you found that several recent construction errors occurred due to miscommunication between your field crew and your project manager, who travels frequently between jobsites. While the project manager would have caught the errors had they seen them in person, due to a lack of clear reporting, they went unnoticed until they resulted in costly rework. You’ve also found that most businesses of your size do not have a dedicated quality manager on staff and, at your current growth rate, there is likely not enough work to warrant a full-time quality management role at this time.
Now, by combining those insights, you’ve determined that there is likely a way you can improve quality control without adding a new position. You pivot your research to ways to improve visibility for your project manager and reduce miscommunication.
Data analysis is a skill, and it’s often the most difficult step of implementing business intelligence strategies. Business intelligence software can help construction companies organize and analyze their data automatically. Instead of manually reviewing documentation, you can input your data into a software system that generates automated reports showing you key insights based on your custom goals and criteria.
4. Actionable Insights
Finally, it’s time to turn the data you’ve collected into action items. Create an implementation plan and involve stakeholders to execute it.
Maybe you’ve learned that the demand for environmentally-friendly construction is growing rapidly in your area, and your competitors have yet to take advantage. So, you schedule training on how to use sustainable materials for your crew and work offering green construction into your future business plan. Or, you’ve decided to invest in a daily reporting tool that includes photo and video capture to improve offsite visibility for your project manager, hopefully reducing quality issues.
Be sure to track the success of any new strategies you implement and be willing to adjust if new information becomes available.
When backed by business intelligence, your decisions are more powerful and impactful.
Gain actionable insights with Raken
Raken’s all-in-one field management app improves visibility and makes gaining actionable insights as easy as clicking a button. Field crews capture data on mobile and report accurate progress updates in real time, while the office can assess performance at a glance with detailed dashboards.
We offer:
Digital daily progress reports - Easily identify issues and keep track of everything that happens on the jobsite (with photos)
Automated production insights - Track time and material use and automatically compare actuals against estimates
Equipment management - See how and where small and heavy equipment is being utilized
Safety and quality tracking - Prevent injuries and construction errors with easy-to-use tools and easily track compliance
Labor management - Manage employee certifications and make sure the skilled labor you need is always available
Raken keeps all your critical documentation in one place for fast, reliable access whenever you need to review or assess past performance.