Arm your business with data
By Michael Wright
With more than 680,000 companies in the construction industry, and many of those companies working together on projects, disagreements resulting in litigation are bound to occur. The most effective way to combat these disputes is through proper documentation. As both personal and professional technology evolves, the difficulties associated with managing and controlling contemporaneous project documentation grows exponentially. To thrive in an increasingly digitized construction industry, contractors must adopt project management solutions built for real-time communication and control.
Indeed, the industry as a whole is turning to cloud-based technology to manage workflows. New software continues to evolve to meet the industry’s productivity challenges, and venture capital firms are taking notice. There has been a 324 percent surge in U.S.-based construction technology startups, garnering nearly $3.1 billion in funding in 2018 alone.
Cloud-based technology allows project constituents to access their information from anywhere, not just the office. Through the use of cloud-based software, construction businesses can update plans, contracts, and more in real time, making it easier to execute everything related to their business. This includes managing business development, preconstruction, project management, scheduling, field management, and cost control. By having access to these tools anywhere, businesses can better track documents and keep consistently updated and accurate records, thereby providing operational transparency and improving project outcomes. Moreover, better documentation can drastically reduce the timelines of controversy and litigation, should it come to that, or to prevent it altogether.
The construction industry is turning to the latest in project management technology to streamline document creation and management. By centralizing and automating large volumes of construction documents and associated metadata, companies can save time and money when it comes to construction disputes.
According to the 2018 Arcadis Global Construction Disputes Report, the average dispute in North America in 2017 cost $19 million and lasted more than 17 months, a number that significantly surpasses the global average of 14 months.
A factor contributing to the extremely long dispute process is a lack of advanced documentation methods within the industry. These inadequate documentation methods make it difficult for construction companies to easily collect the documents necessary to add context and depth to construction litigation in an effort to settle a dispute quickly. The volume of documents and the number of stakeholders involved in each litigation cause construction companies to waste valuable resources, such as time, money, energy, etc., that could be devoted to ensuring successful construction projects.
Lack of documentation on a construction project can easily snowball into a “he-said, she-said” situation that could ultimately amount to hundreds of thousands, if not millions, of dollars in costs to prove whether a simple change order was approved or not. Through the use of cloud-based project management software, the construction industry can mitigate a long, resource-depleting discovery process and get back to the business of building.
According to a survey conducted by Software Advice in 2015, only 24 percent of construction contractors are using construction or proprietary software. However, cloud-based document and project management technology have their fair share of benefits to help establish detailed information to expedite the litigation process.
Construction software aids companies in defining the scope of their project by organizing the documents associated with it, including contracts, estimating costs, establishing qualified subcontractors, soliciting quotes, and finalizing pricing for a project proposal.
Throughout the life of a project, industry-specific software helps make establishing goals and organizing the full scope of a project attainable. Since construction businesses are able to see everything laid out in one place, they can more easily visualize and materialize a project in a timely and cost-effective manner.
Although project plans are set prior to starting, changes are inevitable during its duration, and transparency is a must. Project management software makes it easier to generate, share, approve, and execute change orders. This software aids the construction industry in forming a consistent workflow to make sure the correct process is being followed for the various orders, such as: collecting vendor quotes, ensuring appropriate negotiation fees are being charged, and keeping everything up to date.
The latest generation of cloud-based construction platforms are transformational because they facilitate communication and collaboration, while automatically and passively capturing a vast amount of metadata and contextual documentation along the way.
One of the key features construction software providers have developed is the ability to foster transparency by collaborating with partners in one platform. Software makes it easy for all parties involved to implement real-time revisions on documentation including photos, plan markups, costs, and timelines. All this documentation collection is vital to reducing the settlement process. With it, users can easily identify which parties knew what information and when they became aware of it. Approvals for change orders can be viewed in the software, as well as changes to contracts. Users can also upload photos that can establish why a task was or was not completed—for example, a delay due to weather. These markups can be made in real time directly to plan, notify stakeholders of issues, and record any issues. By using a cloud-based platform, information can be accessed from any location and by all relevant parties.
Within the context of disputes, knowing all the benefits associated with choosing the right platform provider as a construction company can be the difference between a short or lengthy litigation process. Although litigation is not easily avoided in the construction industry—the right software provider can shorten and simplify the process significantly. By promoting collaboration for partners, both parties have access to the same files in a centralized location, ultimately allowing them to allocate their resources more effectively due to the shorter dispute times.
About the author
Michael Wright is CEO of RedTeam Software. With a background as a commercial general contractor with hands-on experience in all aspects of commercial construction, Wright developed RedTeam as a comprehensive cloud-based solution for construction project and accounting management built by contractors for contractors. For more, visit www.redteam.com
Modern Contractor Solutions, December 2019
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