If there is one profession that has really changed the face of our universe is the building and construction profession. These builders and constructs are the people who sit down and draw these skyscraper bridges and all the other man made buildings that we look upon and marvel. However, even with the high number of success stories they have their own share of problem that very few of us know about. Project to project contractors both big and small face some problems. Whether just a painter or a high qualified engineer there are problems each one faces some common other severe.
Despite the rapidly recovering construction market, many companies are still finding it difficult to be successful. Margins are tighter than ever and a lot of companies are trading dollars, but not finding the success they are seeking. In our discussions, we have identified some challenges that our industry faces. Ken Y., Training & Development Manager, discusses 5 challenges the construction industry is facing right now.
Undercapitalization—Operating money is critical to achieve success. Do not underestimate the capital needed to pursue the most profitable projects and have the cash necessary to fund those projects until draws can be obtained. Many bad decisions are made while companies are in panic mode due to their cash being unavailable.
Bad Cash Flow—We all know that getting paid gets harder and harder all the time. Submitting for draws and having an understanding of how each particular client pays is critical to maintaining a positive cash flow into your businesses. A missed draw or poor paying clients has caused many problems in our industry. Stay on top of your cash flow and draw dates.
Inadequate Planning—Understanding your manpower and cash issues can determine the success or failure of any project. Do not overestimate your capabilities or underestimate your cash flow. Map out the details of all of the projects going on and what you are bidding that could happen in the near future. Know who you are and what you can do (more advice on this subject).
Inflexibility—Map out your plan and continually review your plan versus reality. Be willing to make changes when you see your plan is failing. Working without a plan or refusing to gauge success against that plan has doomed many companies to continue down a road to failure. Have a willingness to change the plan and learn. If you haven’t failed, you have not done much. However, learn from failures and incorporate that knowledge into the next plan.
At this time in life the construction industry is at a point referred to as the inflection point same as the move we had on telephones from landline phones to the now cellular phones. The building and construction industry is being disturbed greatly by the digital technologies which are providing the industry with way to address their many challenges. The digital integration into the building and construction world is not a question of when and if but it’s a matter of what is happening now.
The dirt-under-the-fingernails world of construction is breaking digital ground.
In an industry where practices have barely changed for decades, the building site of the future promises comprehensive online modeling, drones as surveyors and virtual-reality images of everything from building sites to commercial real estate.
Led by some big builders and a clutch of startups stretching from Australia to Silicon Valley, the industry is seeking to eliminate the delays and cost overruns that have plagued it in the past.
“We are certainly seeing a rapid shift toward digitization in the construction sector, as the industry looks to harness new technologies to drive more-efficient delivery,” says Alasdair Reisner, chief executive of the U.K.-based Civil Engineering Contractors Association, who sees huge opportunities in building a digital construction industry.