Construction firms lose NZ$53b pa in labour costs on unproductive work
‘Unproductive work’ is costing construction businesses in New Zealand and Australia nearly NZ#$53 billion a year, according to new research.
The findings are part of a survey of the global construction industry covering 599 respondents internationally. The Construction Disconnected research included 80 construction leaders and decision makers from New Zealand and Australia.
Tomy Praveen, the Asia Pacific managing director of construction productivity software provider PlanGrid, which partnered in the research, says the project reviewed how teams spend their time while on
It also studied the challenges associated with poor data management practices and miscommunication, and companies’ technology investments.
“Construction companies on both sides of the Tasman are losing a third of all working hours to unproductive activities.
“That equates to over NZ$53 billion a year in financial waste.”
The research found that each construction worker on a jobsite spends 11.5 hours every week on non-optimal tasks.
The most time-consuming unproductive activities are: looking for project information (4.9 hours), conflict resolution (3.4 hours) and dealing with mistakes and rework (3.2 hours).
This comes despite most businesses (46 percent) saying improving productivity is the main reason behind their technology investments to date.
Construction firms’ productivity is being hindered by poor data and communications.
According to the survey, the most common reasons for tasks taking longer than expected are: poor communication between stakeholders (29 percent), lack of confidence in data accuracy (23 percent), and delays getting data (18 percent).
In addition to causing inefficiency, these shortcomings are contributing to expensive mistakes; poor data and communications alone cause a total of $8.4 billion in rework across the region each year.
Businesses have a made a positive start by investing in technology; now there is a great opportunity to refine their approach by choosing tools tailored to the needs of employees on the jobsite.
Tomy Praveen, Asia Pacific managing director, PlanGrid
“New Zealand’s KiwiBuild initiative is calling for innovative technology and productive construction to drive down costs and make housing more affordable,” Tomy says.
“Investing in the right technology on jobsites will deliver savings and reduce rework, not just for the residential market, but any major construction project in the heavy civil, commercial and residential sectors.
“Bringing field workers into the conversation when selecting technology will not only benefit individual firms but help to keep construction in New Zealand and Australia at the forefront of the industry worldwide.”
Tomy says firms are turning to technology to address the challenges caused by poor data and communication.
Based on survey responses, the top purchasing drivers behind investments in digital tools are: improving the accessibility (36 percent) and accuracy (34 percent) of project data.
However, the report points to a disconnect between the priorities of those selecting technology and the needs of field workers. At present, technology is purchased mainly to suit the needs of the office (54 percent) rather than workers in the field (36 percent). Only 17 percent of firms considered gathering feedback from potential users of solutions before making the purchase.
“Construction firms in Australia and New Zealand are experiencing a concerning productivity shortfall.
“Although many companies have started to invest in technology, these tools aren’t meeting the needs of workers on the jobsite where real performance improvements can be made. As a result, firms aren’t getting the full value of their technology spend and productivity is lagging, while employees are left disconnected and disengaged.”
The use of mobile phones highlights the technology gap between the office and the jobsite. While 44 percent of construction firms give mobile devices to project managers, only eight percent actually use those tools consistently for accessing data or collaborating with other stakeholders.
Where technology fails to meet expectations, it is due to these solutions being a poor fit with existing working practices (39 percent) or technology (11 percent), as well as inadequate training (11 percent).
“Businesses have a made a positive start by investing in technology; now there is a great opportunity to refine their approach by choosing tools tailored to the needs of employees on the jobsite,” said Praveen.
“Embracing technology will improve performance on every project by reducing errors, improving communications and enhancing employee engagement. Bringing field workers into the conversation
when selecting technology will not only benefit individual firms but help to keep construction in Australia and New Zealand at the forefront of the industry worldwide.”