Technological advancements have affected several industries, forcing businesses to adapt to these innovations or fall behind. Similar to other service related fields, construction has also been affected by these changes, which has heavily promoted technological developments within the past decade. Some of these advances include sustainable construction materials and diversifying methods for designing and building facilities. According to the 2021 JBKnowledge ConTech Report, 26% of respondents stated their company has a technological research and development budget, while 56% reported that they did not. Perhaps the implementation of this research within construction is slow moving because the processes are still relatively new or developing. Regardless, it is inevitable that technology will continue to progress resulting in strategic advantages for businesses.
Innovations in building materials are one the main advancements in technology that has significantly influenced the construction industry. Sustainability is a main driver behind construction technology with the goal of developing projects on a mass scale without creating a lasting effect on the environment. The use of green materials results in buildings built with less impact on the environment – as well as more cost effective solutions and long-term savings. Leadership in Energy and Environmental Design (LEED) is the most widely used green building rating system and is an international standard for the design, construction and operation of high-performance structures. LEED certified materials include recycled products, high efficiency pumps and motors, LED lighting, and watering-conserving plumbing. While sustainable resources are growing in popularity, technology is also changing how traditional materials are used and how labor costs and waste are being reduced.
3D rendering software programs such as Building Information Modeling (BIM) allows projects to be designed from start to finish using a digital interface. BIM functions include coordination and clash detection, project visualization, planning and virtual markups. It provides contractors a systematic evaluation of the project and reduces the risk of major errors. BIM is a relatively new technology; however, it paves the way for the future of construction technology. Augmented, virtual and mixed reality, as well as, robotics, machine learning and AI are just some of the other technological advances that could provide construction companies with a competitive advantage in the industry.
Although there are a surplus of benefits of technology in the construction industry, there are several risks such as a reduction in labor due to the use of software, robots and machines. It is important for veteran construction workers and beginners to diversify their skill set and learn new methods pertaining to technological advances listed above.
Accounting within the construction industry relies on a high level of complexity. Unlike traditional businesses, construction companies are mobile with work customized to particular jobsites. Due to changes in projects and jobsites, construction companies must monitor different categories of cost and relay that information back to their accountant. These costs include travel time, mobilization costs such as packing tools and equipment, delivery of materials and clearing of excess materials once the job is completed. It is important to track, report and categorize costs and expenses to understand how to bid on projects, which projects are profitable for your business, how to accurately bill clients and how to efficiently utilize your firm’s resources.
Corrigan Krause Specializes in Construction Accounting
If you’re unsure which accounting method is right for your business, the Construction Services group at Corrigan Krause can help. Email info@corrigankrause.com for more information and sign up for our Construction Services newsletter here.