by Karl Vantine, Chief Customer Officer at Contruent
There’s an oft-quoted line in business that goes, “You can’t manage what you can’t measure.” We could tweak that a bit and say, “You can’t manage what you can’t see.”
This certainly applies to construction — because what you can’t see can jeopardize your ability to fully control a project’s cost, scope and schedule. Managing all of these requires better project visibility.
The Need for Project Visibility
Visibility is a real-time line of sight into project status and progress, its tasks and resources, its adherence to budgets and timelines, and possible risks. But, it’s also more than that.
It’s about viewing it in time so you can act or react. It’s having a window to not just one data point but a panoramic view — seeing the constellation rather than a star, for example — for a more holistic view of your project’s financial health. And it’s about observing your project across time — the verified past, the present and the forecasted future. And it’s about the resulting insights gleaned from all these points of view.
Such visibility is limited when using traditional project controls methods. This poses challenges: insufficient cost data, lack of clarity on progress, inadequate expense tracking, a hampered ability to spot cost overruns, and lack of proactive decisions and risk mitigation. And that all has a downhill effect on profitability.
What provides the visibility to mitigate these challenges and more efficiently manage project costs? There are two things. First is the what: Data analytics and business intelligence processes that each provide clear views into project costs from different vantage points. Second is the how: Software dashboards that can visually represent the data from each process for easier comprehension and decision-making.
Let’s explore how each of these can work for you.
The Power of Data Analytics
We all know that we can learn from the past. And learning from past project data is no different. That gold mine of historical data can be explored and evaluated to help you see into the future, giving clues for how project performance may take shape. For example:
- Do you have past project data that can inform more realistic current and future estimates?
- What risks impacted prior projects, and what was the impact on cost and schedule? What contingency plans were implemented, and how well did they work?
- How accurately can you forecast the financial impact of potential future risks? And can you create contingency plans to mitigate them?
- Using data to perform what-if scenario simulations to experiment with project details (design and materials choices, overtime vs. hiring extra laborers), what do they indicate you might anticipate with costs given the simulated outcomes?
- Are you able to see trends or patterns in your data? Where did sudden or severe fluctuations occur? What do they indicate?
- Can you detect minor cost deviations as they occur and take corrective measures before they become major issues?
Once armed with these results, data analytics takes on a predictive role, making it far easier to plan and make essential decisions that keep your projects running smoothly.
The Role of Business Intelligence
You have to know where you are now to understand where you’re going. That’s what business intelligence (BI) is based on. It’s understanding how your business or your project is performing at this moment and using data to inform what objective decisions or steps need to be taken now to maintain current progress or course correct anything that isn’t performing well.
That data comes from the real-time tracking and reporting of project data that is constantly being gathered and processed by your capital project management software that incorporates BI. It allows you to definitively answer questions such as:
- How confident are you in using your data to decide the best courses of action to keep the project on a healthy financial track and course-correct as necessary?
- Are you able to track all project expenses accurately and in real time?
- How well are expenses staying within planned amounts? Would you know if a project was performing poorly?
- Can you efficiently allocate resources, including budget and labor, when and where needed?
- Can all key stakeholders and project team members access cost information as needed?
- Are cost reports easily understood with little time and effort required for interpretation?
Leveraging the Value of Data Analytics and Business Intelligence Through Dashboards
So, given the vast amounts of raw data a capital project generates on any given day, let alone across the span of its construction, how do you make sense of all the data analytics and business intelligence available to you? Through online dashboards.
The beauty of dashboards is that you don’t have to be a data expert to interpret anything. They’re a simple way to view the complex. As a visualization tool, they condense, arrange and present all that detail for you on one screen per topic. So, they’re essentially delivering real-time project visibility graphically. Graphical representation of your data can take the form of pie charts, bar charts, S-curves, line graphs and so on, and are often customizable by color, line style, layout, etc., to make it easier to digest at a glance.
They’re also customizable by the kind of information being presented. Say you want to surface specific key performance indicators (KPIs); you can define which ones to monitor. Cost performance index (CPI) is a logical one, giving you a view into your project’s financial efficiency. As a responsive metric, it naturally fluctuates with risk factors or project-impacting decisions as they occur, so you’ll get an early indication of a developing issue if it starts to veer beyond its normal operating range.
Consider what having this informational and graphical project visibility enables you to do from a daily project controls standpoint:
- Make observations and data-driven decisions on managing costs essentially on the go.
- View high-level synopses of financial status and progress and drill deeper within the dashboard for more detail as needed.
- Identify potential cost deviations and overruns sooner so you can proactively respond.
- More easily collaborate with other stakeholders operating from the same dashboards for consensus decision-making.
Having full project visibility — fast, accurate and in real time — means better control of your projects’ costs, scope and schedules through capital construction software that incorporates data analytics and BI via dashboards. Ready to learn more? Visit Contruent.com to learn how we can help you deliver value faster with each project.