Data . . . data . . . and more data. Most construction companies don’t have problems collecting data—whether in paper or electronic form. Efficiently sorting through that data and using it to make the most-informed decisions is another story. That’s why I found it interesting to listen to Joe Burkett talk about how his company puts their data to work.
Joe is chief financial officer of Cafco Construction Management. At least that’s his official title. In reality he wears many hats (HR director, IT director, you name it) in what he describes as a small boutique construction company. Cafco does amazing high-end construction work, primarily restaurants, in the Greater Boston area. Their job cycle is short, with projects typically running from eight to 20 weeks.
That short project cycle affects everything they do from a decision making basis. “Human capital, financial capital, profitability, and expenses—anything looking forward has to be viewed in short windows of time,” Joe says. Every two weeks, for example, he looks at cost-to-complete forecasts for all the company’s current projects.
Cafco uses an integrated accounting and project management software system to sort through all the details. For example, Joe can review in one report current commitments made against each item in the original contract budget and quickly identify any questions for the project manager. “If we have a $100,000 plumbing line item and there is $90,000 commitment to a subcontractor, I want to know if we are saving money on that line item, or are there additional costs to be incurred,” he says.
Understanding immediately whether a project is at, below, or over budget is not only critical for Cafco’s project profitability, it’s essential for their customer’s own decision making. “Our clients are typically privately funded, so there’s a heightened attention as to where the money is being spent,” Joe explains. “If we are saving money on one item, we let the client know because there might be something else they want to do with that money.”
Cafco also monitors its data to track major risk areas such as compliance. If a sub’s insurance expires or a lien waiver isn’t signed, their software automatically notifies appropriate project managers and administrators of the issue. That’s a big time saver for Cafco, which subcontracts about 90% of its work.
With a relatively small staff, Cafco is always looking for ways to minimize paperwork and other data intensive work, so people can focus on what they do best. That’s where Joe says it helps to have technology that keeps track of the important information. “I can focus on the big picture and our project management team can stay in the field preventing and solving problems rather than spending 70% of their time in the office slugging through data.”
About the Author
Deb Carpenter-Beck is a writer and marketer with more than 25 years of experience in the construction and real estate industries. She often writes about technology and best practices and is passionate about helping contractors and real estate professionals achieve their business goals. You can follow her on Twitter @DebCBConstruct.