Finding Concrete Tech Solutions

 OP INDUSTRIALBy HK Bain

Construction contractors and suppliers face a dilemma: how to manage jobs and company operations with maximum profitability in an industry fraught with roadblocks to efficiency including rising costs, remote job sites, regulatory issues and project delays. As this digital age brings advances to nearly every business sector, the construction industry has been slow to adopt new technologies. How might attachment to paper-based document management processes be contributing to lost productivity and higher overall job costs?

With construction professionals typically spread across job sites – and limited office support for immediate needs – retrieving information from paper documents has become burdensome, time consuming and costly. In today’s digital universe, employees (and customers) are accustomed to real-time accessibility of data. Companies unable to deliver this risk losing a competitive advantage.

According to PricewaterhouseCoopers, traditional paper-based processes carry significant costs: 

• The administrative cost of retrieving a paper document can cost as much as $122 per document.

• It takes an average of 20 minutes for employees to retrieve, copy and forward needed information in a paper document.

• Employees spend an estimated 20 percent of their time searching for information in paper-based filing systems.

• An estimated 7.5 percent of company documents are lost completely – seriously impacting receivables, customer satisfaction and productivity.

In addition, a 2012 International Data Corporation (IDC) study found that the risks associated with outmoded document business processes are extremely high. In the construction industry, where compliance with a variety of governmental regulatory agencies is mandated, lack of access to information can create serious productivity delays. The IDC report found that nearly 80 percent of companies reported suffering severe consequences due to inefficient document processes. It’s time for construction site managers to resolve inefficient paper processes by embracing digital options.

Facing Jobsite Realities

The old adage that “time is money” has never been more accurate. To manage deadlines and control budgets, construction professionals need to know a job’s status at all times. This need is made more critical by the real-time communication of email, instant messaging, voicemail and texting. Construction companies can no longer utilize modern technology in the field while relying on outdated processes back in the office. 

One of the world’s top five producers of construction aggregates, Vulcan Materials Company of Birmingham, Ala., recognized this problem at its Midwest distribution headquarters. As of 2015, Vulcan Materials employs 7,000 individuals at more than 344 facilities in the United States, Mexico and the Bahamas. The company ships millions of tons of crushed stone, gravel and sand each year. 

At the Midwest distribution headquarters, shipments typically generate more than 200,000 paper “proof of delivery” (POD) tickets each month, which are shipped from 30 locations to be sorted and filed by hand in a 200 square-foot storage space. 

Costs to operate and manage the system proved astronomical, yet were not atypical for a company with a field-centric organization:

• Average annual storage costs of $21,600. 

• Annual cost of $1,600 to employ temporary labor in support of occasional audits for collections and cases.

• One full-time salaried employee responsible for locating requested tickets for customers. 

• Thousands of dollars in write off losses each year on tickets that were lost in the system. 

Making the Move 

Vulcan Materials sought a solution to solve their process inefficiencies. Like many companies in the construction industry, Vulcan’s organizational needs required a system with low cost of entry, ease of training and operational simplicity. 

Vulcan Materials identified an enterprise content management (ECM) system that offered the company the familiarity of their paper-based system while eliminating inefficiencies. Vulcan works with a local imaging provider to convert paper POD tickets to electronic files, which are then securely managed and accessed via the cloud ECM service, ImageSilo. Employees were easily trained on the new system and can now retrieve data from the system almost instantaneously. ImageSilo allows Vulcan employees to retrieve information from wherever they are – and customers can gain secure access to documents when needed. 

Savings Realized

The implementation holds a lesson for all construction industry companies hoping to resolve their own document process challenges. All told, Vulcan Materials has saved more than $128,000 by streamlining its POD ticketing system.  Although paper will always be an integral part of construction business processes, adopting new ways to streamline its use across the organization is critical to growth. Without taking this step forward, you risk being overtaken by competitors able to communicate at a faster pace. 

HK Bain is the president and CEO of Digitech Systems, Inc., a provider of content capturing and management products. For more information, email info@digitechsystems.com, call 866-374-3569, or visit www.digitechsystems.com

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