Today’s technology is disrupting the world’s oldest industry, construction, according to James Benham, CEO of JBKnowledge, Inc., a construction and insurance technology solutions company based in Bryan, Texas.
For Benham, technology is a means, and the end is improved construction productivity.
Benham is adamant that, because construction is a low-margin, low-productivity business and its productivity is lagging behind other industries, the construction industry must embrace technology now.
What do construction firms have to fear if they don’t get on the technology bandwagon? According to Benham, they risk being left out of a phenomenon that some call “constructuring,” the merging of construction and manufacturing. Manufacturing could steal construction’s business out from under it as it takes increasing advantage of technology to improve its processes and safety record, said Benham.
Contractors should upgrade their technology use now. Benham explained that one of the first things they can do is convert their paper and spreadsheet output to digital.
“Get rid of paper plans, get rid of submittal reports. Whatever they do on paper and in excel, these are easy pickings to automate,” said Benham, adding that contractors should make the following three technology changes a priority. They are: (1) digitize paper and excel workflows; (2) integrate technology systems (for example, integrate estimates with the projects they manage to integrate with product financials); (3) build robust virtual and construction capabilities by having a team of Building Information Modeling (BIM) engineers and detailers who take a leadership role in coordination and clash detection on building projects.
Benham’s advice to sureties is: “get serious about data.” He said sureties should convert from systems that rate risk on a historic time-frame measured in years. Instead, they must ask themselves, what is the risk like today? Technological applications make that assessment possible, added Benham.
“Real-time data rather than historical data and working with contractors to actually track what’s going on at the job site—if you can’t measure it, you can’t manage it,” Benham said. “Who cares what they did three years ago? What matters is what they’re doing right now.”
Benham sees construction 10 years from now as moving inexorably toward prefabrication of buildings and roads through techniques such as 3-D printing. The finished products are then transferred to the sites where they are needed. He said the implication for surety professionals and their construction clients are a major improvement in safety, which will require refiguring risk and, therefore, surety rates.
“Construction can mitigate risk and increase margins through the use of technology and through the use of process improvement,” Benham explained.
Benham sees lower production costs through efficiencies, lower labor costs, and improved safety. The key for construction, Benham said, is to escape the current paradigm of a high-risk, low-margin business.
Learn more about how construction can embrace and benefit from technology by purchasing the 2019 NASBP Annual Subscription Series to obtain the recording of the NASBP January 15 Virtual Seminar featuring James Benham and titled “The Future is Now: How Today’s Tech is Disrupting the World's Oldest Industry."