What is Benchmarking in Construction? (And How to Get It Right)

July 15, 2024

Kristen Sylva

Benchmarking is an important topic, but many people are still unclear about what it is. So, what is benchmarking in construction?

To illustrate, let’s imagine this scenario. It’s the night before a big meeting at a new jobsite and you want to plan your commute to ensure you arrive on time. To help you achieve this goal of on-time arrival, you pull up Google Maps.

You input your desired location and the time that you need to arrive. It then tells you, based on all of the traffic data collected from all of its users, approximately how long it will take you to get there, so that you can plan your departure time accordingly.

This is benchmarking at its finest, and what it gives you is predictability. Every day, Google Maps takes in data from millions of people using its search engine, and uses it not only to help users get from point A to point B, but to actually predict their commute before they even think about getting in the car.

Want to learn more about KPIs, dashboards, data lakes, and more in construction? Join our Construction Data Summit: Navigating Your Data Journey Across the Ecosystem:

Benchmarking in Construction

Benchmarking in construction gives you better predictability in your organization

Now, imagine a different scenario. Same meeting, same intention to plan your commute. But what if Google was only collecting information from a small percentage of its users? How much would you trust the application to give you the right information, if the technology itself didn’t have the full picture?

I know what you’re saying. “That’s silly. Why would they only capture SOME of the information even though every time someone logs onto the app to get directions, that data is pushed into the cloud and stored for analysis?”

Well, you probably didn’t say it exactly like that, but you understand the point.

And, unfortunately, as ridiculous as this scenario is, it’s exactly what we are doing in construction. In a study conducted between Autodesk and Dodge Data and Analytics about the KPIs for construction, it was discovered that while most contractors have sought out technology, such as software, to move their process from analog to digital, they have on average only done this on about half of their projects.

That’s a LOT of data that’s still being managed either on paper or on a spreadsheet saved to a desktop or sharepoint site.

To make matters worse, a JBKnowledge Construction Technology Report shows that nearly 20% of construction companies use six or more different software applications, with 24% reporting that none of their software integrates. This means that what data they do have is spread across multiple platforms–making it impossible to accurately collect and correlate even these limited data points.

The Key Everybody Is Missing

Now, I will admit that I am a card-carrying member of the Data Nerd Club, so this may fascinate me more than the average person. But research shows that most contractors do have the desire to use data and information generated from technology to gain better insights into their projects. You want to make changes to optimize workflows and processes based off those findings.

You can see this desire in action at any conference, by the number of enthusiastic hands that are raised when a speaker asks how many intend to use data to gain better insights.

But watch as most of those hands slowly descend when the crowd is asked, “Who is doing it now?”

The problem is that we all know why data in construction is important and what insights gained from it can do for our projects and business. But nearly everyone is getting it wrong because they don’t have enough data to analyze. And in order to have enough data to analyze, you have to collect it - frequently and consistently across all of your projects.

Here’s how to get there.

How Data Is Being Collected and Analyzed Today

Benchmarking in construction put simply: Use technology to collect construction data, analyze it, and put it to use.

But while as simple as it is to state, if you look at how contractors are currently collecting and analyzing data, there are some gaps. We uncovered some new insights when we conducted a recent survey with Dodge Data & Analytics on construction standards and processes. Promisingly, 79% of contractors are using software to track processes like capturing errors, omissions and/or constructability issues discovered in the “bid set” of construction documents, creating a log of RFIs and responses, collecting and documenting change orders, managing project schedules, recording safety performance, and tracking labor productivity.

However, when it comes to utilizing software for data collection, many firms struggle with standardization. According to our survey, contractors cited the development of consistent methods and standards as the most challenging aspect for implementing software. Respondents also agree that not having standardized data inputs in technology tools can negatively impact their work. Forty-one percent said that non-standardized data input leads to inconsistent, inaccurate incomplete, and unusable data.

The survey also found that the majority of respondents (56%) feel they have an insufficient ability to fully explain or capture data. Forty-seven percent said their issue lies in the lack of clarity of captured data for later analysis, while 32% of contractors don’t fully understand the options in standardized data inputs.

To see more insights on data standards and processes, read the full report:

READ full REPORT

All of these challenges impact the ability to create successful benchmarking in construction today and into the future.

Getting Started with Benchmarking

In the course of my work, I’ve had the pleasure of speaking with many GCs across the world about their process and projects. What I’ve learned is that while most have a desire to use technology effectively for data and analysis, the challenge has been ensuring that processes are set up to consistently collect it.

Fortunately, many contractors realize that adopting these processes doesn’t happen overnight, and that you can’t force technology upon someone. There is a cultural element that needs to be considered - thinking through how you are going to get everyone to adopt this new way of ‘doing things.’ I feel Troy Erbes of Dannis Construction said it best in a recent article noting that in most businesses, and especially construction, culture trumps strategy.

In all my conversations with contractors, I’ve heard what works and what doesn’t work, and where some GCs are seeing substantial success.

Here are some of the best practices those contractors are adopting:

Identify where you want to focus. Instead of a one-fits-all approach attempting to fix all of your processes at once, find the easiest one, identify where processes are inconsistent (not collecting data) and implement new or revised standards. For example, your construction quality program.
Evaluate your current process for that area of focus. Are you using software (cloud-based purpose-built software, not just Excel!) to manage your construction quality or safety program on ALL of your projects? If not, why not?
Identify your blocks. What’s keeping you from implementing cloud-based software on all of your projects?
Evaluate your implementation process. What has been working and what hasn’t? What would a successful implementation process look like?
Collect data in a single source. Once you have tackled the ‘low hanging fruit’ and you start to consistently collect data, you’ll be able to aggregate it into a single source (this is where having a technology platform and integrations between technologies becomes critical). Analyzing this data will give you your benchmark, or baseline, that you can start to measure against.
Consider hiring a data and process specialist, either on a contract basis or permanently. These experts don’t have to be expensive, and they can help streamline your benchmarking and analysis process.
Gain support and buy-in from stakeholders by providing examples of successes. What stories can you show that are compelling?

Now, I know it’s easy for me to sit behind a computer and just type this. I recognize that the process is much easier said than done. Yet many contractors are successfully implementing these processes.

We all appreciate some predictability in our everyday lives (I know I do), and we could certainly use more predictability on the jobsite and in our projects and business as well. Data is the key to predictability, and predictability leads to better quality for clients and stronger reputations for contractors.