Building the foundations of the future with process automation

Maggie Murphy00:00

Hello and welcome to Construction Executive's professional education series. You have joined the webinar titled Building the Foundations of the Future with Process Automation, sponsored by FlowForma. My name is Maggie Murphy, and I'm the managing editor for Construction Executive, published by Associated Builders and Contractors. I'll be serving as moderator of today's presentation.

Maggie Murphy00:24

Now I'd like to introduce our speakers, Philip McCartney and Paul Stone. Phil has recently joined FlowForma as Vice President of Sales. He has a wealth of international experience and a career spanning more than 20 years, and his main focus is helping companies take the next step in their digital journey by embracing the no-code revolution and empowering their teams to digitize faster than ever. Paul Stone is a product strategist at FlowForma, the leading provider of no-code process automation tools. Paul uses his in-depth product and construction sector experience to support FlowForma's construction clients in achieving serious savings and competitive advantage, and he is committed to empowering citizen developers to digitize their processes without using any software code.

Phil McCartney01:23

Thank you, Maggie. Hi everybody, good morning, good afternoon, good evening, wherever you are. I'm Phil McCartney, VP of Sales at FlowForma. As Maggie said, I've only recently joined, so a caveat before we begin: whenever you hear me asking pretty simple questions, that's not an act. I'm still learning all about the construction business and process automation within it.

Phil McCartney02:01

The idea of this session is to build the foundation to truly automate and digitize construction businesses. We're not here to sell. Instead, we're here to give you the benefit of our experience, certainly more Paul's than mine, and paint a picture of what we've learned from our clients in construction and other sectors.

Phil McCartney02:53

First we'll look at the current digital state of construction: where the sector is, what the issues are and where you are on your digital journey. I'll share some personal insight from my first weeks, then results from a survey we commissioned this summer of decision makers in the construction sector, just like you. Paul will then cover the strategic needs and process trends for 2023, and most importantly, how to get started. We want this to be as interactive as possible, so we'll run anonymous polls as we go, and please use the chat to comment, ask questions, and even debate us a little. We'll leave five to ten minutes for Q&A at the end.

Phil McCartney05:01

I've never worked in the construction sector before, so it's been a very fast learning curve. Before I share that, Maggie, can we open our first poll? We want to find out where your organization is on its digital transformation journey. This is about your organization, not you personally.

Phil McCartney06:14

So 60% of you say digitization initiatives are among the main priorities of your business right now. Paul, that's pretty much what we've seen over the last six to 12 months, isn't it?

Paul Stone06:28

Yes, absolutely. We've really seen an uplift in interest from construction companies in digitization. They're seeing that the technology is now available to make a real difference: to carry out their operations faster, respond to change in the marketplace and deal with challenges like resource onboarding.

Paul Stone07:28

I think we're really at a turning point. Over the past 12 to 24 months there's been an upsurge in the adoption of digital processes and digital tools across construction. Four or five years ago people were talking about it but not doing much about it. Right now they're definitely acting.

Phil McCartney08:04

On my own journey: in my second week at FlowForma I was in New York, trying to understand the challenges in the construction industry. There were a lot of events that week, on everything from the Inflation Reduction Act to how to adopt it, and a lot of the chat was about the new digital processes companies needed to manage it.

Phil McCartney08:54

The most important part of the trip was our own breakfast briefing at the Irish consulate. Our client Sullivan Engineering gave great insight, but the real insight came from the coffee breaks. Professionals in the construction industry, chatting idly, shared exactly the same pain points: manual processes, problematic sites, keeping up with codes and standards. It made it abundantly clear to me that a platform like ours could come in and solve some of these problems.

Phil McCartney10:36

Before we move on, I'd love to take another poll. What are the biggest obstacles your organization is facing right now?

Phil McCartney11:08

Great, we can close that poll now. Thank you, everyone. Paul, there it is: 43% say manual processes.

Paul Stone11:21

I'm not surprised at all by those results. Manual processes are a real bugbear, especially since the pandemic, and they're definitely impacting the smooth execution of projects. It's interesting to see adoption at number two. Many people investing in digital technologies are finding it hard to get them adopted by the workforce, and a system that's not adopted isn't giving you the benefits. That combination of manual processes and adoption is the story we hear again and again from construction clients, and something we look to address in every project.

Phil McCartney12:10

It does seem to be the tipping point. The pandemic forced a more digital view of the world, and now people are asking, why are we still doing these things manually?

Phil McCartney13:10

FlowForma works in multiple sectors, including insurance and finance. When we decided to move into construction in a much bigger way, we wanted to know at a very deep level what the challenges were, so we put our money where our mouth is and commissioned a survey of 100 construction decision makers. We wanted to find out three things: the challenges construction is facing, how technology plays a role in the response to them, and the desire in the sector to broaden its digital capabilities.

Phil McCartney14:33

The first result is where construction is right now: 57% of respondents said their organization's processes are managed in outdated ways, on paper, email and spreadsheets. Paul, this is what you're seeing day to day with our clients, isn't it?

Paul Stone15:04

Yes, absolutely. It's quite a surprising statistic that over half of the construction companies surveyed said over half their processes were running inefficiently, using outdated mechanisms. But it's not too surprising to us. Processes are typically run on pieces of paper or email chains, maybe with a spreadsheet to track progress, and all of those methods are prone to error. It's very difficult to capture valuable data that can be used later for analytics to make better decisions.

Paul Stone15:59

People might say, we're using email, that's digital. It's not really. It's not capturing the data, and it's not a reliable communication mechanism. You need something better to track those processes and make them run efficiently.

Phil McCartney16:31

When we showed this slide in New York, it really resonated. On a very complex project, email folds in on itself, because it's so difficult to track exactly where things are and what changed.

Paul Stone17:12

That's it. You have to keep track of it in your mind: you sent an email on Monday and they haven't got back to you, so you're chasing people all the time. An automated system that prompts people to do the work is the way to go, so you can focus on getting your job done rather than reminding other people to get theirs done. Spreadsheets are not a whole lot better. They have to be kept up to date to be useful, and that's an overhead.

Phil McCartney18:16

The next question we asked was what outcomes are important to your organization when digitizing, and safety comes out on top. Paul, is that only true of construction?

Paul Stone18:36

Safety is one of our top use cases across all sectors: incident management, safety reporting, safety observations and NCRs all come under the same umbrella. But it is absolutely number one in construction, so it's no surprise to see it at the top, with quality procedures close behind.

Phil McCartney19:21

One outcome I'd expect to rise as the sector learns more about automation is increasing operational efficiencies. That's ultimately what we're trying to do at FlowForma.

Paul Stone19:51

Indeed. With digital processes in place, work moves automatically from one person to the next, whether they're on site or back in the head office, and they're prompted that they have a piece of work to do. That really accelerates processes, and you can track them automatically and see the status in real time instead of updating a spreadsheet. A lot of construction companies see potential for real growth in the coming year, and improving efficiency enables that growth.

Phil McCartney20:53

When we start working with a client, we look at outcomes quite closely, so let's run another poll. What outcomes are important to your organization when digitizing: safety, quality, time to market, better customer experiences, or increasing operational efficiencies? It's all anonymous, so you don't have to go automatically to safety.

Phil McCartney21:28

Very interesting: 63% are looking at increasing operational efficiencies. I think that reflects the people in the room. In the first poll, most said digitization is a critical need, and the further down the line you are, the more operational efficiency rises to the top.

Paul Stone21:57

It was really interesting to see operational efficiencies so high. I was expecting a more even response. It's great to see people realize they are inefficient. Often people look at their systems and say, we've got digital systems, they're good enough. What people in construction are realizing now is that it's not good enough. You have to make use of the technologies that are there to keep pace with the market and your competitors, and to handle future growth.

Phil McCartney23:00

We quite often see customers come to us in panic mode, which is fine, we can help with that, but the problem could have been identified six months or a year earlier.

Phil McCartney23:33

Third, we asked which business processes respondents would classify as a priority for optimization and automation, with health and safety coming out on top, only just.

Paul Stone23:56

Health and safety comes up as number one all the time. People consider it a must-have. What's interesting is how high procurement, supply chain and onboarding are. Supply chain is becoming increasingly difficult to manage with all the price increases on basic supplies, and being able to switch between suppliers easily as availability and prices change is so important. People are finding that the systems they have in place to support that aren't reactive enough.

Paul Stone25:13

On onboarding, we're seeing resource shortages across construction projects. Next to health and safety, onboarding of contractors and suppliers is probably our biggest use case in construction.

Phil McCartney25:44

That's the bread and butter. When we do a first process, contractor onboarding tends to be the one everyone wants, because they see the volume. But the processes that have captured the imagination of some of our construction clients are things like subcontractor submittals and compliance, where well-defined filing means you can instantly refer to anything to do with safety, legalities or insurance.

Paul Stone26:48

Right down at the bottom of the list, bid management is really significant in sectors like civils, where companies going after new government funding have to go through tender processes. For maintenance providers and subcontractors, fleet management is a big thing. If we could split this list by sector, you'd see a different set of priorities in each.

Phil McCartney27:42

Finally, what are the biggest obstacles standing in the way of your company's digital transformation? IT talent comes out on top. FlowForma was built on the premise that IT talent would always be scarce, and that's why we built a no-code solution. I'd also include the second answer, internal talent and recruitment, which is the same problem in a lot of ways.

Paul Stone28:31

Yes, absolutely. Implementing systems that track and change your business isn't usually easy, so you look to internal IT resources, and they're just not available. Packaged solutions are very expensive and take a lot of time and expertise to implement. Traditional IT, whether your own staff or IT vendors, isn't delivering the change you need quickly enough.

Phil McCartney29:28

I'll touch on the internal champion a bit further on. We'll make these slides available, and the construction survey results are very good for building internal agreement on what's important and why.

Paul Stone30:10

We break the strategic needs of the industry into three. First, operational efficiency, so you can better handle change, whether that's growth, new regulations or changes in your supply chain. Our suggestion is to take a process-first view. Rather than treating it as a technical problem, think about how you operate your business and what steps you need to make a positive change. Deliver a system your workforce can adopt quickly, that benefits them directly and that they feel ownership of. Reduce your IT dependency, because if you're waiting on IT, it will take a long time or never happen. And monitor performance, using the improvement to build momentum for change.

Paul Stone32:20

Second, customer satisfaction: improve quality and report it back to the customer, so they can see the progress you're making and the benefit you're bringing. Customers are more demanding now. They're asking you to evidence the work you did and show you're progressing according to contract.

Paul Stone32:59

Third, better decision making. One of the top things we hear in construction is analytics. Your accounting system captures invoices, but what you want is detail on the activity of the resources in your business, so you can see how they're working toward business and project goals. Data also lets you find broken processes and refine them. And you want to connect your systems, so data moves smoothly between them and the people working on the project.

Phil McCartney34:14

We connect into numerous systems through an open API, and as a salesperson I love that, but it was Paul who educated me on our process-first approach, and it's been a game changer for me. Customers stand back and decide, as a business, what they want to happen and the outcomes they want, irrespective of the systems they currently use. Paul, if we're going to give away one thing on this webinar, it's that, isn't it? Strip everything back, decide what you want to happen and how, then layer your systems on top.

Paul Stone35:27

Yes, absolutely. Your processes are all about how you use your resources, and focusing on process focuses on what your business actually does day to day and how people work together, or don't. That lets you improve processes over time and get more from the people you have. And it's not that hard. It doesn't need IT resources. You can do it.

Paul Stone36:15

Here's an example of a process before and after digitization: a permit to dig, used at a large transport civil construction company. Before, there were lots of emails flying around as people chased permits to find their status. There was no visibility of who had the ball, and you need the permit to carry out your construction work, so projects were delayed, and delays cost money. The data was recorded on pieces of paper and wasn't being captured.

Paul Stone37:32

After digitization, the process is kicked off by an electronic form that captures all the requirements for the permit, which is then submitted for the permit to be issued. The approval process is tracked, so the person who requested the permit knows exactly where it is, who has the ball and whether it's running late. Once the permit is issued, it's referenced back into the GIS system, so they can quickly see it was issued appropriately.

Paul Stone38:12

This example is from the same company: job records and timesheets. New contractors and employees are inducted onto the project through an electronic form on a public link, before they have access to any company systems. Once registered, they can sign in and out of the project and record the work they're doing, all held in a central database, and the information is sent on to payroll for processing.

Paul Stone39:18

At the end, the system automatically generates Word documents that the payroll provider uses to pay employees. The perfect system would integrate straight into payroll, but people found they could put this process together really quickly, and that integration would add only a small extra benefit. Inducting people, getting them on the register and recording their hours generated massive benefits over the manually filled paper they used before. These two processes were covered in more detail in one of our webinars with Downer, which is available on our website.

Paul Stone40:31

This is what you get as an output of digitization: reporting. This live dashboard came from a very large project called the A14 in the UK, upgrading a 30-mile section of highway. Again it relates to permits to dig. They aggregated all the permits across the entire section, so they could see a complete view of progress. The project ran for more than four years, with over 2,500 people working on it, and I think somewhere in the region of 30,000 permits were issued.

Paul Stone41:50

Everybody on the call knows permits are a really significant part of construction, and it doesn't just apply to permits to dig. Capturing information electronically, getting it approved and then generating an automatic email or document that says, here's your permit, carry out this piece of work, is an area that could be greatly improved in most construction companies.

Paul Stone42:43

I'll keep it brief, because time is running away. First, documentation is being generated digitally. You record data on an electronic form, on a mobile device or a desktop, and generate the documents you need automatically, including any your customer's contract demands.

Paul Stone43:37

Second, all that data enables analytics. Everybody wants better data to make better decisions on the progress of the project, and better forward decisions six to 12 months down the line on the people and materials they'll need. You only get that if you digitize and capture the raw data electronically.

Phil McCartney44:21

And mobile first is really important to construction. When you capture data properly across the organization, back office or on site, the analytics get better and better.

Paul Stone44:41

Absolutely. We work in a few different sectors, but construction has driven our development of mobile technology. We've improved our mobile technology twofold at the very least, based on the requirements of our construction clients.

Phil McCartney45:06

How to get started. In our survey, people talked about not having an internal champion in the business. I think that's critical, and those champions exist in construction more than in a lot of sectors, because your people understand how to take a project from A to Z and get things done. The best champion is someone who won't just sell digitization to the business, but will drive adoption and training and change the core of the business.

Paul Stone46:03

Definitely. Construction is all about getting things done, and companies can find people who desperately want to make improvements. Unlike some services companies, where individuals at desks aren't so aware of the bigger picture, people in construction generally know their processes pretty well, which is a great starting point, and they're keen to champion digitization.

Phil McCartney47:24

On the process-first approach, what's the first thing you'd advise someone to do?

Paul Stone47:41

It ties in with targeting the obvious. People in construction know their biggest pain points and are very quick to give answers, so they know where to go first to make the biggest impact. With tools like FlowForma, you can digitize a process in four to six weeks, get it out there and get a measurable return from that point on. Measuring that return demonstrates the value and builds momentum for broader change.

Paul Stone48:42

Avoid getting bogged down in things like integrations. You absolutely can do them, and they add value, but they can be a stumbling block. The feedback from our customer base is that the most successful approach is to focus on digitizing the process and come back to integrations as a second phase. That generates the best return on investment.

Phil McCartney49:20

And once you can clearly show the financial officers, the CEO and the owners the return on just one process, you get that C-suite buy-in and off you go. Involving external suppliers and contractors has also worked really well. We can bring externals into processes at no extra cost, and it's been a big part of our growth.

Paul Stone50:22

Absolutely. Interactions with suppliers, contractors and subcontractors are often a bottleneck, so systems that reach out to those external parties increase the efficiency of any process they touch. Pretty much every construction customer we have has built processes that interact with external parties, and it's a real selling point to the board.

Phil McCartney51:21

Key takeaways before we go to questions. There's plenty of ROI and plenty of benefit in digital process automation, but the main point is that it isn't that hard. Paul is constantly saying, just get that first one done. This isn't a giant project that needs millions of people just to get to stage one. It's an iterative process that should grow in your company over a number of years. With no code you're not dependent on IT resources, and you don't need a million meetings. The way to get everybody on board is to get one process in the bag.

Paul Stone52:50

Just to reiterate that: we have clients who took a big-bang approach and digitized over 40 processes, and very shortly afterwards they saw a 50% reduction in customer complaints. You might be focusing on efficiency, but you may not realize you're having a really positive effect on your customers.

Maggie Murphy53:32

Thank you both. I'll start with: what processes do you believe are worth prioritizing for automation, specifically for construction companies?

Paul Stone53:50

Onboarding is a very big one. Pretty much every construction company digitizes human resource onboarding first, or as one of the first. Second, supply chain and supplier onboarding, which is very relevant right now. Third, safety, because everybody has to do it. And fourth, quality checks: where people have used FlowForma for quality checking, they've seen significant benefits, and it ties in with customer relationships.

Maggie Murphy54:55

Can you give a specific example of an ROI that you've calculated, and how you determined it?

Paul Stone55:11

A number of customers have done this themselves, to sell what they're doing internally. FlowForma automatically tracks the progress of processes, how long each step takes and how resources are being used, so you can compare how processes worked before and after digitization. For specific figures, the A14 project digitized over 76 processes. One of them, targeted risk monitoring, saved an estimated £37,000 on that process alone. On the permit to dig process, with about 30,000 permits issued, they calculated savings of over 2 million over the lifetime of the project. It varies by process and the size of the organization, but it can be very significant, and it's easy to measure because the system captures the metrics you need.

Maggie Murphy57:07

Some construction companies have a lot of employees working on job sites with very poor or no internet. Is that something your app can support?

Paul Stone57:21

Yes. Everything is stored in a central database, and you typically access it through a web browser back in the office, or through the mobile application, which has been particularly successful in construction. The app has an offline ability, so you can fill in a form or a process step on site while offline and synchronize it when you're back online. For example, a large client in the UK on a tunneling project has no connectivity in the tunnel, so they capture the data on the mobile device and synchronize it when they're connected again.

Maggie Murphy58:21

Switching gears a little: an attendee asks if you're open to working with universities to prepare construction-specific case studies.

Phil McCartney58:34

We're always open. We're working with a couple of universities at the moment, so yes, absolutely.

Maggie Murphy58:48

You touched on ROI for one company, but give us a broader sense of how you can quantify the value digitization brings to an organization.

Paul Stone59:06

We quantify it by looking at the duration of the process. The system gives you the metrics, and you multiply the reduction in duration by the number of people involved and their pay rates. That's how our customers have done it. We have a series of case studies on our website with specific calculations. Customers take slightly different approaches, but they all look at resource utilization, how digitization reduced the duration of a process, and multiply the difference by the number of people.

Phil McCartney60:34

Thank you so much, everyone, for attending today. It's been great to see your feedback in the polls. We'll have a post-webinar survey, and we'd love to hear more from you. Feel free to get in touch with me directly for a one-to-one chat, or book a demo.

Maggie Murphy61:07

Thank you both, thanks to FlowForma for sponsoring this webinar, and Paul and Philip, thank you for the expertise and experience you've shared with us today. Please take a moment to subscribe to Construction Executive, follow us on social media at constructionexec.com, and subscribe to our weekly newsletter, CE This Week, to be notified of upcoming webinars. Thank you very much for your time and attention today.