A Paperless Construction Office?

It’s a fact: The construction industry runs on paper. Blueprints, CAD drawings, budgets, schedules, purchase orders, invoices, change orders, payrolls and punch lists — all of which must be quickly and easily accessible.

Plus, most of these documents must be archived for years to protect the contractor from legal issues. As a company grows, its offices practically stagger under the heavy load of paper.

Computer technology hasn’t reduced the need for paper; by placing what amounts to a printing press near every desk, it’s increased it. But new online tools offer opportunities to level the paper mountain and sharply reduce the personnel hours that go into maintaining it. These streamlined systems let employees easily find, view and transmit documents from their computers.

Online organization can reduce costs, avoid lost documents, improve efficiency and ultimately raise a contractor’s bottom line.

Payables and Receivables

In a business where revenue recognition is driven by costs, recording invoices quickly is critical. But most contractors today rely on a process made cumbersome by the physical separation of the accounting office from the project manager. Paper invoices can easily get lost or sit under a pile on a desk in the PM’s trailer.

By moving to an electronic platform, contractors speed the process, safeguard documents and quickly spot bottlenecks. A PM alerted by a built-in email notification can view an invoice, add comments to it, code it by job and activity, approve or disapprove payment and advance the document automatically.

Electronic billings are also becoming more popular, as some government and other contracts require them. Whatever burden this poses to contractors is usually offset by a shorter receivables cycle.

Managing Bids, Managing Subs

Accurate bids are more important as competition intensifies. Electronic estimating and bidding systems confer an advantage over companies that manually process, copy and deliver their documents.

Online bidding systems can also help manage subcontractors. New software makes it easier for subs to participate in the estimating stage, and easier for GCs to target bid invitations according to a sub’s past performance, skill sets, bid history and compliance with EEOC and other regulations. Meanwhile, the ready availability of online plan files and high-resolution images helps subs develop more accurate bids.

Safety Inspections

The first line against accidents is adequate safety inspections, which most contractors perform with pencil and paper. The system is open to delays and errors, and it’s easy to let a necessary follow-up — Has the sub fixed the third-floor railing? — fall through the cracks, with consequences both tragic and expensive.

A new generation of tablet PCs transfers the inspection process online. The devices are better suited than larger computers to the rigors of a job site. They run dedicated software, draw on long-lasting batteries and display information clearly even in bright sunlight.

Many programs prompt responses, creating a consistent and repeatable routine that speeds up inspections and makes it hard to overlook details. And most can pull up OSHA rules on demand.

When an inspection is complete, the handheld device can synchronize automatically with home-office systems over the Web. The link works both ways, tracking violations and alerting inspectors to follow up with subcontractors. The centralized system lets a GC manage multiple subs on a single platform, and preserves a record that makes safety audits easier and protects the contractor against complaints or lawsuits.

Cost Effective

The technology isn’t new and it isn’t overly expensive. High-volume scanners are available for less than $1,000; machines capable of scanning extra-wide plans cost less than $2,500. Software prices vary depending on ease of use, automatic backup routines, Web hosting and other features.

As this technology becomes integrated with construction and project-management software, it helps contractors organize their records, their accumulated knowledge and their businesses more effectively than ever.

Finally, when disputes arise, the party with better documentation usually wins. Winning one such dispute can easily pay for an entire electronic document management system.

Porter Keadle Moore, LLP is a founding member of ProfitCrew, an association of accountants and business advisors dedicated to helping construction companies build profitable businesses. For information, contact Adam Polakov at apolakov@pkm.com or visit www.pkm.com.