At Envision, our clients are seeing significant dividends from digitising their construction timesheets. The more we talk with a range of project and business stakeholders across the construction industry, the more we’re seeing this as a huge area of improvement potential. Some of the people who influence decisions around technology adoption may not have frontline experience, so we’ve put together this summary of the fundamentals of construction timesheets to help build a baseline of understanding.
Fundamental one: time clocks and attendance records aren’t timesheets
Time clocks and attendance records perform functions like recording when specific people arrive at and leave a site. Depending on the process used, they might record who is on site at all times (ie entry/exit rather than solely clock on/off records). Start and end times generated also may not be the same as a person’s start and end time for payroll (eg you might arrive 15 minutes before your scheduled start from which you will be paid). Timesheets, in contrast, record the quantum of work performed against a specific job/costed activity. They are normally used to drive payroll, as well as job costing and performance reports. Both have distinct roles and, when they are both in use, cross-referencing them is a powerful way to identify errors such as missing timesheets and incorrectly recorded timesheets, and verify actions such as payroll and subcontract payments.
Fundamental two: contract types and delivery models influence need
The approach to capturing time from a contractor’s perspective depends on the contract type and delivery model. Timesheets are generally required for staff, direct workforces, labour hire, and hire plant and labour on day dockets. As an example, if a project’s delivery model is largely subcontract lump sum and schedule of rates, the need for timesheets will likely be basic. However, this may change if a project presents considerable risk exposure to the contractor or client if schedule completion milestones are missed, like on large oil and gas and mining projects where the cost of missed production is high. It’s critical to match timesheet processes, and the level of detail captured, to each project’s contract type and delivery model.
Fundamental three: many stakeholders use timesheet data
After a little digging, it’s amazing to see just how many stakeholders are involved in the timesheeting process and/or who typically uses timesheet data. Some of these include:
- Individual workers – they need a record for payment and a fast, simple process.
- Subcontractors – they need a record of their workers’ time to pay them and submit end-of-month progress claims, and need easy access and reliable records to ensure payment.
- Supervisors – they need to check and approve hours worked, ensure costs are allocated to the right activities, get feedback on their team’s performance, maximise their field time to keep their project on track, ensure their people get paid and avoid IR issues…and the timesheet process needs to be fast and simple.
- Engineers – they approve the allocation of costs to the right activities, monitor performance across their scope and forecast job costs based on past performance and forward projections.
- Project managers – they monitor scope performance, ask questions on exceptions and guide corrective actions to keep their project on track.
- Payroll – they track leave, and pay staff and workforce their entitlements and allowances.
- Contracts administrators – they verify subcontractor progress claims, approve appropriate payments and determine accrued costs that haven’t yet hit the finance system.
- CFO – they need accountability and certainty around who is getting paid what, and they need an appropriate audit trail to drive verification and responsibility.
- HSE – they track safety exposure hours worked and safety performance statistics.
- Commercial – they require quantified and verified records to substantiate claims for variations and extensions of time.
- Project controls – they require quantified records for performance reporting.
- Estimators – they require quantified records of time required to perform various activities for comparison against estimating norms to improve competitive estimating on future jobs.
With these fundamentals in mind, manual processes present major risks to projects and leak a significant amount of value (either lost time to perform value-adding tasks or avoidable costs etc). Here is the core difference between typical manual processes and digital processes.
A typical manual process
A typical digital process
In reality, while the digital process sounds simple, the devil is in the detail. Paper seems very forgiving, with minimal validation rules and a human to interpret records. It is also infinitely flexible as it can be routed through different hands to record and extract data. And it seems easy and fast in the first instance. Successful adoption of a digital process requires solid upfront thinking and a simple, intuitive solution that is fast for all stakeholders to use. Then it can remove the need for duplicate timesheet records held in disconnected systems by those diverse stakeholders. We’ll share more on considerations for selecting digital construction timesheet solutions soon.
If you’ve moved from manual, paper-based timesheets to digital ones, we’d love to hear about your experiences. If you’re intrigued, we suggest you map your own process as you might be surprised at the admin waste and data delay waste for all of those stakeholders involved. And please get in touch if you’d like to know more about our offer in digital construction timesheets.
I was delighted to be invited by Aconex to share at the recent 2017 Construction Technology Summit as part of the panel on ‘Best practices in successfully introducing digital construction technologies’.
For a very well attended event, it was exciting to see the changes in play across the industry, and the desire from owners to contractors to consultants to software vendors around tackling the lagging digital technology adoption challenges of the sector. There’s no question that productivity gains are still hampered by a reluctance to change, as shown by McKinsey in one of their 2016 articles.
With these findings in mind, it’s no wonder I most connected with speakers who shared on how to best digitise the construction industry. While there is a lot of talk at the moment about AI, and how to leverage it to drive better outcomes on projects, as Andrew Newsome from Boston Consulting Group pointed out, without (digital) data, AI doesn’t work. The sector’s future is in better capturing digital and structured data, in part so it can leverage these other technologies.
Of course, that’s easier said than done, so here are three takeaways I particularly valued from Andrew Newsome, Kate Nelson (Head of Business Technology & Innovation, LendLease) and Ken Panitz (Principal Methods & Lean, EIC Activities).
1. Projects are good at avoiding new initiatives
Andrew talked about the fact that project and construction managers have numerous challenges on their to-do lists and are focused on delivering their projects. As he suggested, when you consider that a construction project may have a duration of as little as two years, it’s not long enough to generate a strong return on investment from new initiatives…certainly not on its own.
If you want a project to support new initiatives, Andrew’s advice was to:
- Ensure the initiative is a priority at the highest levels of the company and project org charts
- Allocate dedicated project resources to support and drive the new initiative
I touched on this in my panel session and discussion with Emma Shipley (CFO, Roberts Pizzarotti). In my experience, the best project outcomes for a new initiative come when there is engagement at both a corporate and project level – in contributing resources and guiding the direction of an initiative. It is critical to truly understand what’s going to make a difference at the coal face for a project when you’re setting up an initiative. At the other end, you need to ensure corporate goals are incorporated so value is generated not only at the project level, but also the corporate level.
2. The right people are essential to supporting change
Having the right people involved in a project can make the difference between success and failure. Kate Nelson summed it up when she spoke of the triple threat, below. These are definitely attributes I seek in the people I try to involve in digital initiatives on projects. As Kate put it, the triple threat is:
- Understanding how to use technology: this is self explanatory and essential to being able to evangelise and influence others to adopt new tech.
- Understanding engineering: if you’ve walked in the shoes of various key roles on engineering projects, and truly understand their pain and drivers, and can communicate and relate technology as it matters to them on a practical level, you’ve won half the battle. This is much more powerful than just taking someone a piece of tech and showing them how to use it. The value is in helping users know how to apply that tech to benefit their everyday work.
- Being an influencer (change agent) with strong IQ and EQ: we often refer to this as winning the hearts and minds of people on a project, meeting people where they are at and inspiring them to buy into the vision of the new initiative you’re introducing. That’s when they are more likely to champion it and become change agents themselves.
3. You need a strategy to speed up digitisation
Ken is championing digital disruption in construction through his role at EIC Activities. He made the point that there is no longer a single application that rules. The future is around flexibility, best of breed applications and the need for easy integration. He went as far as to say he won’t consider a solution without it first having an API. His message to software companies was, “build your API first…don’t have it as an item on your roadmap that’s coming soon”. Ken also shared how, at CIMIC, they are fostering innovation through a strategy of lowering requirements to trying new ideas; embracing that failure is okay; and limiting the investment and time to quickly show potential or fail fast. This is certainly a different approach to traditional big business cases and bureaucratic processes by being much more agile.
Our team’s recent work on the APLNG project with CPB Contractors underscores the importance of these considerations. The project team ultimately transitioned from having 600 paper dockets per day to 95% of those being electronically submitted. We worked with project leaders to address hurdles, like getting individuals to use a mobile device for project processes, getting subcontractors to let go of paper dockets, and getting engineers, supervisors and leading hands to adopt an unfamiliar digital process. We took learnings from a trial roll-out to streamline training and team engagement and it has ultimately been a huge success. Among a range of factors, I really saw the importance of:
- Strong engagement from project leaders
- Responsible champions with success linked to their KPIs
- Consistent and ongoing communication with staff and subcontractors through the change.
In closing, there are learnings already available in the Australian construction sector when it comes to introducing new tech. For project leaders, seek software partners who have been there before and don’t be afraid to ask them for their learnings as well as successes to give you a running start.
Watch the session here
Based on projects I’ve been involved with, I’d say the answer to whether the construction foreman’s paper diary is dead, is a resounding…no.
While we’re seeing a growing trend in the desire for electronic diaries and digital workflows, the default is still typically a paper-based system – unless a project’s leaders drive digital. Research conducted by McKinsey suggests the construction industry is second lowest only to agriculture and hunting when it comes to digital uptake.
What’s the purpose of the foreman’s diary?
In Australia alone, the value of avoidable waste from disputes in the construction industry tops $7 billion (see this CRCCI study). That’s an insane figure considering the massive push for efficiencies. One of the keys to avoiding disputes is early notification of issues that may lead to time and cost impacts (see this analysis).
Here enters the foreman’s diary. It’s a key source of what’s happening at the workface and a powerful communication tool for raising issues with project leaders via engineers and project managers who read these records daily.
The foreman’s diary is also a critical tool in the unfortunate circumstance a claim moves into a dispute. That’s because it’s a record of what has happened from the perspective of the client, contractor and subcontractor – recording key facts such as resources on site for the day, work performed, performance observations, key issues and delays, directions given, weather etc. These records support a court assessment regarding the amount that should be paid by one party to another for work delivered.
Why transition to digital?
1. Faster communication and easier search capability
Digital records are available and searchable as soon as they are created. Rather than wait to the end of a day, or the next shift, for a manual, paper report, everything from Events to photos to progress updates are available immediately. This improves communication between a team, enabling earlier identification of issues and faster mitigation…reducing time and cost impacts.
While digital records add immense value during the delivery of a project, if a dispute arises, they also support significant savings by avoiding the need for claims consultants to go through paper records and convert them to digital records. The records are captured as the work is done, meaning they are ready and available from the outset as an as-built record of the project.
2. Better recording consistency with earlier identification of missing records
With paper diaries, missing or poor quality records are not identified until they are actually required, which can be as late as a dispute situation. This is generally because those records are filed in a site office but not used by anyone downstream. This means they’re not that visible to a project team.
A digital foreman’s diary is easily built into the daily and weekly communication processes of a project and is highly visible to everyone, particularly project leaders. Just one benefit is that missing and poor quality record keeping are very quickly picked up.
3. Richer records
Paper diaries typically don’t include photos and GPS-tracked, time-stamped records. It’s true that a picture tells a thousand words. With today’s technology, including smart phones, there is no reason why diaries shouldn’t be supported by rich photos that are tagged to issues, Events, Activities, the work breakdown structure, team commentaries, GIS information and more.
There are many digital solutions available in the market, from apps as simple as Evernote to specialised construction diary applications.
Naturally, I’m most familiar with Envision’s diary solution. We’ve developed and deployed this across major infrastructure and resources projects. Through this, I’ve seen the content of digital diaries being actively used during delivery – and by many more stakeholders than traditionally possible with paper diaries…in ways, you would have never considered. Digital diaries are supporting the daily workflow of:
- Project engineers
- Construction managers
- Project managers
- Commercial managers
- Contract administrators
To find out more about how Envision can help your site record keeping, check out this video: