April 29, 2021

Why enabling the “digital transformation” of construction isn’t about technology

The construction industry is undergoing a major digital transformation across the entire business lifecycle - but what are the underlying opportunities and challenges associated with this transformation and how can stakeholders on all sides of a project best identify them?

The need to utilize new and innovative construction solutions that create measurable efficiencies is understood by many. This drive has resulted in the creation of tools that are literally and figuratively powerful, the latest of which can be seen with the recent news from Dodge Data & Analytics (“Dodge”) and The Blue Book Building & Construction Network (“The Blue Book”), which saw the two companies combine their businesses in a merger. 

The Dodge | Blue Book Construction Industry Database will contain more than 10 billion data elements and contains the most complete information about projects, people, firms and products in the construction industry. While these types of solutions have been touted as the way to address construction inefficiencies by further enabling the digital transformation of the industry, their potential to change the way established workflows function often creates hesitance around adoption. Those challenges are further complicated by the fact that there are few industries where the risk is as high as it is in construction. This can cause hesitance around such transformations, even when the economic benefits of doing so are well understood. 

Dodge CEO Daniel McCarthy specifically referenced how the construction industry is undergoing a major digital transformation across the entire business lifecycle in the press release that announced the merger, but what are the underlying opportunities and challenges associated with this transformation and how can stakeholders on all sides of a project best identify them? For McCarthy, the answer to that question relates to the much more powerful contextual data that Dodge and The Blue Book will now be able to provide but is also connected to a much more fundamental challenge around adoption that the construction industry as a whole needs to address.

The origins of the most complete construction industry database

Frederick Warren Dodge founded what would become Dodge Data & Analytics in 1891. He co-opted the card catalogs that were just being introduced into libraries at the time to help connect what were otherwise disparate processes throughout construction. What that looked like in a practical sense was a stack of index cards that would cover the life of the project from the beginning through planning and design and bidding, etc. If you were a building contractor, you would get the cards you needed to go find the architect. He saw all of these pieces that were not connected and figured how to connect them. 

“Fred Dodge was a genius because he recognized how card catalogs could be utilized to answer a fundamental question in construction,” McCarthy said. “It’s one that always has and always will exist, which is, ‘how do I make this piece of information useful to the right person?’ He solved it with cards and we solve it with software but that same spirit and that same drive around organizing principles is the same across the eras.” 

This direct connection to the past was further echoed in many of the conversations that the contemporary leaders of Dodge were having when asking their users what they were doing with their data. The same challenges that firms, projects and people were struggling with in the 1800s were evident. They realized they needed to connect all of these elements with more complete information, which the Blue Book contained. That realization fast-tracked a merger that has created the most complete primary data source of information about people and firms in the industry. 

Crucially, what was also evident in those conversations was the fact that the construction industry as a whole has moved from applications to solutions. These solutions are intended to drive change, but how can those changes take place when user experience problems arise? And how are those changes connected to what has been positioned as a much bigger shift for the industry itself?

What does the “digital transformation” of construction really mean?                                

Talk about the “digital transformation” of the construction industry has been happening for a long time but the concept is being positioned in a wholly different way on account of reports that many construction projects can be as much as 80% over budget and take 20% longer to complete than scheduled. Many look to solutions and tools that digitize processes or connect workflows as the solution to these inefficiencies, but the true transformation of the industry is about something much more fundamental.

“People like to characterize the digital transformation of the industry as a wave, but it's actually just the water level is rising,” McCarthy continued. “Everyone has laptops and cell phones now, and they’re using them to define an entire technology ecosystem that still supports their traditional processes. People are executing more and more of their day-to-day activity in a digital ecosystem powered by digital tools. The challenge is how do we as an industry create the kind of ease of use, superior user experience that will let people continue this evolution naturally.”

The Dodge | Blue Book Construction Industry Database is designed to be that exact type of ecosystem, which organizes data in a way that drives strategy on multiple levels and in numerous departments. However, seeing it used on those levels and by those departments isn’t a question of accessibility or technology. Seeing individuals and entire organizations take advantage of such tools often means making a change, and anyone making that shift can be taking on tremendous risk. What happens if those changes are not successful?

For Dodge, ensuring that success is about making data as accessible, usable, reliable and complete as possible. Dodge is helping companies reduce uncertainty and risk by linking all these data elements together, so that each user can easily find the data they want at the right time, and in the right way. Even with all of those pieces in place, users still might need to adjust their approach in order to actually make those connections and see those efficiencies realized. Fully enabling them is more about people than it is technology. 

“Are you adaptable?”

The dangers and risks associated with the construction profession as a whole are often cited as the reason many are cautious to adopt or utilize something new, and there has to be respect for that caution. However, human beings also have a fundamental resistance to change, with change that encounters risk being especially difficult for people to get emotionally organized around. Determining the core issue around this resistance isn’t as important as sorting out the best way around it.

“A rubric that I've used over the years is related to being adaptable rather than compelling change,” McCarthy continued.

“Are you an adaptable person? That’s really different than saying, ‘I want you to change’. Adaptability is a characteristic that people feel is positive and they want to associate with themselves because no one wants to be rigid. At the same time, you have to consider the user experience, which is more art than science. User experience is all about avoiding that one critical error that makes someone say, ‘I'm never using this again.’ That requires organizations to think through everything from the perspective of a user.”

What this actually means for an individual user and an entire organization obviously varies throughout the construction industry, but one of the critical fault points for anyone adopting a new tool is data. The more noise you have in your data, the more challenging it is going to be to execute whatever you're trying to execute in that adoption and digital transformation process. Digital ecosystems that provide constant feedback allow users to effectively adapt in the short and long term, showcasing what it can mean to move past adoption hesitancy.

Ultimately, an effort to allow everyone to use the same grade of data is at the heart of the combination that Dodge and The Blue Book represents. This new system creates the most accurate primary, data source for people, projects, firms and products in construction. That information can be used to positively change processes, but doing so is ultimately just a byproduct of an endeavor to turn disparate relationships into connected knowledge that will positively redefine construction workflows.



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