I can’t think of many other businesses that have as much data as a construction company. The surge of information from sources such as emails, plan revisions, conversations, documents, and change orders – from across multiple projects and jobsites – is mind boggling. As I wrote in my blog post last week, a solid reporting system can synthesize large amounts of this data into useful project summaries, field reports, and financial statements. But many construction executives are taking their business visibility a step further by using technology to filter through the data so they can track major risk areas and act quickly.
Here are three ways you can actively monitor your business:
- Key Performance Indicators: These high-level benchmarks serve as yardsticks to evaluate how things are going, whether you are reaching your goals, and if you have any red flags. Some common KPIs include liquidity, work backlog, budget variance, and cash flow.
- Alerts: These instant notifications are triggered when certain conditions are met and are sent through email, text messages, or via a daily dashboard. One CFO I know set up an alert to notify him when their current profit margin is less than a specified percent.
- Dashboards: An effective dashboard provides a visual snapshot of important metrics, KPIs, and other relevant information. While a dashboard provides a high-level view, you should also be able to drill-down to find more detail and context.
For more information about monitoring your construction business, download the monitoring edition of The Construction Executive’s Interactive Guide to Business Visibility. In this e-book, you will learn about tools, technologies and tips that will keep you focus on what matters most to your business.
How are you using KPIs, alerts, and dashboards?
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.