Innovations Uncategorized

How Construction Companies Can Use Digital Technology to Gain a Profitable Advantage

Author Alf Delli Fiori – CEO – Eredox – Construction Technology Systems

Has your company established digital technology that allows all your systems and processes to be more cost-effective? 

“A construction project is a network of hundreds of processes, participants, products, and materials. Money transaction and/or data exchange are frequently performed along with project progress.

There are a significant number of disputes and litigations occurring during construction. Although things like payment terms and data confidentiality are outlined in a contract or an agreement, disputes often arise over the stipulations of the agreed protocols” (Taylor, 2017). 

In line with research, around 30% of the cost of construction is wasted due to errors, labour inefficiencies and other problems that could be fixed with the help of technology. The reason for this might be in the variability within the construction industry – it is hard to get all participating parties (engineers, subcontracting firms, designers, and general contractors) to embrace the digital technology at once.

This highly fragmented state of the construction industry might explain why it is so challenging for this sector to adopt the benefits of digital technology. At the same time, however, big construction projects are taking longer to complete and exceeding their original budgets more than ever before. According to the McKinsey Global Institute, capital projects take up to 20 percent longer to finish than scheduled and run as much as 80 percent more over budget. A key reason is that construction firms are often slow to adopt technologies that would enable them to cash in on this growth.

Distributed ledger technology also known in the tech industry as DLT, is changing the world at a faster pace than ever expected, and the adoption of blockchain Smart Contracts has made it possible the develop software with this technology for the present and the future. 

The rise of blockchain technology has created new ways for businesses to seek greater efficiency, new business models, and to disrupt incumbents. We live in a time of both great opportunities and great risk for the construction industry. Oxford Economics’ Global 2030 forecast predicts that construction will grow more than 4 percent annually over the next 15 years. In the US, the news is even better: the construction market is projected to grow 6 percent per year, reaching $10.5 trillion by 2020.

We must embrace change now. When designing software, proprietary technology such as the Eredox Platform has placed great emphasis on collaboration not only for the end user, but collectively uniting all departments and business actors under one system, with an easy to understand user interface (UI) and user experience (UX) in getting all participating parties (engineers, subcontracting firms, designers, and general contractors) to participate under one intelligent business system on any given project resulting in a scalable network effect.

Construction software must be able to give weight to these elements to ensure that users not only find it easy to learn how to use the system but also to enjoy the experience of using it. The greatest promise lies in technologies that are just beginning to take hold, such as artificial intelligence (AI), blockchain with smart-contract technology management, and big data analytics, trend analysis and contractor payment systems. Specifically, blockchains. To give some insight a blockchain is a database that is shared across a network of computers. Once a record has been added to the chain it is very difficult to change. To ensure all the copies of the database are the same, the network makes constant checks. Blockchains have been used to underpin cyber-currencies like bitcoin, but many other possible uses are emerging (Murray, 2018).

Matsika (2018) suggested that the benefits of blockchains are:

·        No third-party involvement

·        Trusted transactions

·        Reduced costs

·        Transparency

·        Real-time tracking

·        Security

·        No single point of failure

Blockchains are huge opportunities for construction companies just to compete in the market place for the future, simply put, digitise your business today and become a leader in the industry tomorrow.

Eredox users deal with all their construction participants through the Eredox environment, inviting them to tender, quote, contract, invoice and view construction transactions as guests. This permits an exponential spread of the software creating a network effect throughout the related industries – engaged initially as guests, the construction participants regardless of company structure like enterprise, SMB’s are highly likely to embrace a standardized system collaborating and working with their clients under one system. 

A quote within Charles Dickens’, “A Tale of Two Cities” eloquently describes the crossroads of today’s construction companies. “It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us…Yes, we everything before us, let’s seize the opportunity now.

To request a free copy of The Eredox Whitepaper, visit our website here or to request a client representative to get in touch and discuss how we can assist click here

About Eredox

Eredox is a blockchain based Enterprise Resource Planning (ERP), Business Intelligence (BI) and Artificial Intelligence (AI) software for construction management businesses in Australia and globally. It offers a comprehensive collection of integrated, Smart Contract based, decentralized applications DApps that organizations can use to effectively collect, store, manage, pay, exchange and interpret data from business activities.

References

Matsika, B. (2018, August 24). Short View: Block Train electoral voting solution to the “rigging” problem. Business Times: Retrieved from: //businesstimes.co.zw/short-view-blockchain-electoral-voting-solution-to-the-rigging-problem.

Murray, M. (2018, June 15). Blockchain explained. Reuters Graphics. Retrieved from: //graphics.reuters.com/TECHNOLOGY-BLOCKCHAIN/010070P11GN/index.html.

Taylor D (2017). Construction and Blockchain: how can it help the industry? Published in Capterra Construction Management Blog., 2017–2–28.

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