Benefits of a Common Data Environment

The commercial construction industry is known for its complex and multi-faceted projects that involve numerous stakeholders, tight timelines, and large volumes of data. Managing and coordinating this data is challenging, leading to potential delays, errors, and increased costs. However, a solution to streamline and optimize data management in the commercial construction industry is a Common Data Environment (CDE). A CDE is a centralized digital platform that facilitates collaboration, data sharing, and information management among project stakeholders in a controlled and structured manner. This white paper explores the benefits of a CDE for the commercial construction industry, including increased efficiency, improved communication, enhanced collaboration, and reduced risk.

Leveraging the features of a CDE in a project controls software, owners and contractors can improve project visibility, streamline communication, enhance document control, manage changes, monitor costs, and track schedules, leading to improved project performance and successful project delivery.

Introduction

In the commercial construction industry, managing vast amounts of data and coordinating multiple stakeholders can be daunting. Traditionally, construction projects have relied on disparate systems and tools for data management, leading to fragmentation, miscommunication, and potential delays. However, with the advent of modern digital technologies, a Common Data Environment (CDE) has emerged as a powerful solution to streamline data management and optimize project workflows.

A CDE is a centralized digital platform that serves as a single source of truth for all project-related information, documents, and data. It provides a controlled and structured environment where project stakeholders, including owners, architects, contractors, specialty contractors, and suppliers, can collaborate, share, and manage data in a seamless and efficient manner. Here we will delve into the benefits of a CDE for the commercial construction industry and how it can revolutionize project delivery.

Benefits of a Common Data Environment for the Commercial Construction Industry:

1. Increased Efficiency: A CDE centralizes data and streamlines workflows, reducing manual and time-consuming processes. It allows stakeholders to access the latest project information in real-time, eliminating the need for multiple versions of documents or data silos. This ensures that all stakeholders are working with accurate and up-to-date information, minimizing the risk of errors and rework. The efficiency gained through a CDE enables faster decision-making, reduces delays, and accelerates project timelines, ultimately leading to cost savings.
2. Improved Communication: Communication is critical in construction projects, where various teams and stakeholders need to work together seamlessly. A CDE provides a unified platform that enhances communication and collaboration among project participants. It facilitates real-time messaging, document sharing, and notifications, ensuring that stakeholders are on the same page and can quickly resolve issues or make decisions. Moreover, a CDE also maintains a comprehensive audit trail of all communications and changes, providing transparency and accountability across the project lifecycle.
3. Enhanced Collaboration: Collaboration is at the heart of successful construction projects, and a CDE fosters collaboration among stakeholders. It provides a common platform where teams can work together on design, planning, scheduling, and other project activities. A CDE enables concurrent work on different parts of the project, allowing stakeholders to collaborate in real-time, make updates, and track progress. This eliminates the need for manual coordination and promotes cross-team collaboration, leading to improved project outcomes and stakeholder satisfaction.
4. Reduced Risk: Construction projects are prone to risks, such as design conflicts, schedule delays, and cost overruns. A CDE helps mitigate these risks by providing a centralized platform that promotes transparency, accountability, and traceability. It ensures that all project information, including design documents, contracts, and specifications, are stored and managed in a controlled and auditable environment. This reduces the risk of data loss, mismanagement, and disputes. Additionally, a CDE provides robust access controls, permissions, and versioning, safeguarding against unauthorized access or modifications. By reducing risk, a CDE protects project stakeholders and enhances project success.

Existing Landscape

In today’s commercial construction industry, owners and contractors typically manage their data using a variety of methods that center around manual processes, spreadsheets, email, and standalone software applications. While workable, these methods result in data fragmentation, miscommunication, and inefficiencies, leading to several problems:

1. Data Silos: Individuals store data in different spreadsheets, systems or formats, resulting in data silos that are not easily accessible or usable by other stakeholders. This leads to delays in obtaining critical information, duplication of effort, and increased risk of errors.
2. Version Control Issues: With multiple stakeholders working on different parts of a project, managing versions of documents, drawings, and other data is challenging. This results in confusion and mistakes, leading to rework, delays, and additional costs.
3. Lack of Real-time Collaboration: Traditional methods of data management don’t facilitate real-time collaboration among project stakeholders, resulting in delays in decision-making, slow communication, and misalignment among teams.
4. Limited Visibility: Management struggles to gain a holistic view of the project due to scattered data and lack of visibility into the latest information. Lack of clarity leads to difficulties in tracking progress, identifying issues, and making informed decisions.
5. Increased Risk of Errors and Disputes: Without a centralized and structured data management system, contractors face increased risks of errors, discrepancies, and disputes. This also results in additional costs for rework, delays, and potential legal disputes.

Overall, the constraints stemming from disconnected systems and data add significant inefficiencies and risk to project delivery leading to unexpected costs and delays. According to a study by FMI Corporation, inefficient data management practices and bad data can cost contractors up to 16.5% of the project budget due to rework, delays, and errors. Additionally, lack of collaboration and communication can result in increased project durations and potential penalties for missed deadlines, leading to financial losses.

It is worth noting that the costs associated with poor data management practices in the construction industry go far beyond monetary expenses. They can also impact talent retention, stakeholder relationships, project reputation, and overall project success.

Potential Solutions

Owners and contractors have several alternatives to the ubiquitous spreadsheet for managing their data in the commercial construction industry. Some common alternatives include:

1. Construction Project Management Information Software (PMIS): There are specialized construction project management software solutions available in the market that provide features for data management, collaboration, and document control. These software tools offer centralized platforms where contractors can store, organize, and manage project data, including documents, drawings, schedules, budgets, and communications. Examples of such software include Procore, PlanGrid, and Autodesk BIM 360.
2. Building Information Modeling (BIM) Software: BIM software allows contractors to create digital representations of the building or infrastructure project, including 3D models, schedules, and cost information. BIM software enables data integration and collaboration among various project stakeholders, facilitating efficient data management throughout the project lifecycle. Popular BIM software options include Autodesk Revit, Trimble Tekla, and Bentley Systems.
3. Cloud-Based Document Management Systems: Cloud-based document management systems, such as Google Drive, Dropbox, and Microsoft SharePoint, provide centralized cloud storage where contractors can securely store and manage project documents, drawings, and other data. These systems often offer collaboration features, version control, and access controls, allowing contractors to streamline data management and improve team collaboration.
4. Common Data Environment (CDE) Platforms: CDE platforms, such as Relay, Aconex, and Viewpoint for Projects, are specifically designed for construction projects and provide a centralized environment for data management, collaboration, and document control. These platforms typically offer features such as document management, version control, RFIs (Requests for Information) management, and submittals management, all within a single integrated system.
5. Integrated Enterprise Resource Planning (ERP) Systems: Some contractors use integrated ERP systems, such as Oracle Primavera or Sage 300, which provide solutions for project management, financials, procurement, and data management. These ERP systems offer features for managing construction data, including document control, project cost tracking, and reporting.

These alternatives to spreadsheets provide more robust and specialized solutions for contractors to manage their data, improve collaboration, and streamline project workflows.

The industry is shifting

In recent years, there has been a growing trend towards digitization and adoption of construction technology solutions to improve project efficiency, collaboration, and data management. Many owners and contractors recognize the limitations of traditional methods, such as spreadsheets, and are actively seeking more advanced solutions to overcome the challenges associated with data fragmentation, version control, lack of collaboration, and limited visibility.

Various industry reports and surveys indicate that the adoption of construction technology solutions is on the rise. For example, a 2020 report by JBKnowledge on the "ConTech Report: The State of Construction Technology" stated that 78% of construction professionals surveyed use construction project management software, and 49% use cloud-based document management systems. Another report by Dodge Data & Analytics on "Using Technology to Manage Construction Risks" in 2019 found that 43% of contractors surveyed were using BIM (note: however, most of these contractors are not using BIM for a fully coordinated Level 400 detail 3D model), and 37% were using mobile applications for data collection and project management.

While the exact percentage of contractors using these solutions may vary, it is clear that there is a growing trend towards adoption of specialized data management solutions in the commercial construction industry to overcome the challenges associated with traditional methods and improve overall project outcomes.

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The Impact of Doing Nothing

Continuing to manage data in Excel spreadsheets or relying solely on manual and disconnected data management processes, has many negative consequences for contractors in the commercial construction industry. Some of the potential impacts of doing nothing and sticking with Excel spreadsheets for data management include:

1. Inefficient and error-prone data management: Excel spreadsheets are susceptible to errors, especially when multiple team members are inputting and manipulating data. This leads to data discrepancies, duplicate entries, and version control issues, resulting in inaccurate and unreliable data. It is also time-consuming to manually update and manage spreadsheets, leading to inefficiencies and increased administrative overhead.
2. Limited collaboration and communication: Excel spreadsheets are typically stored locally on individual computers or shared via email, which can limit collaboration and real-time access to data. This leads to communication gaps, delays in information sharing, and difficulties in coordinating among team members, subcontractors, and other project stakeholders. Lack of a centralized system for data management results in confusion and delays in decision-making.
3. Reduced visibility and reporting capabilities: Excel spreadsheets lack advanced reporting and analytics features, making it challenging to gain insights from the data and generate meaningful reports. Limited visibility into real-time project performance, cost tracking, progress tracking, and other critical metrics impedes data-driven decision-making, hinders project analysis, and compromises project success.
4. Increased risk of data loss and security breaches: Storing project data solely in Excel spreadsheets or local computers can increase the risk of data loss due to hardware failures, software glitches, accidental deletion or a team member’s departures. Additionally, Excel spreadsheets may not have robust security features, such as access controls and audit trails, which can expose project data to security breaches and unauthorized access, potentially leading to data breaches, legal issues, and reputational damage.
5. Reduced competitiveness: In today's competitive construction industry, contractors who do not adapt to modern data management practices face a disadvantage compared to competitors who are utilizing more advanced solutions. Inefficient data management practices lead to project delays, increased costs, and reduced project quality, which impact the contractor's reputation, client relationships, and future business opportunities.

Continuing to manage data in Excel spreadsheets is ineffective, resulting in inefficient data management, limited collaboration, reduced visibility, increased risk of data loss and security breaches, and potential negative impacts on project performance and competitiveness. Embracing more advanced data management solutions enables owners and contractors to mitigate these risks. Ultimately, more predictable and repeatable project delivery results, empowering companies to improve their competitiveness in a rapidly evolving construction industry.

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Benefits of Common Data Environment

While BIM, ERP, and PM softwares are valuable tools in the construction industry, a CDE) offers unique benefits that make it a compelling choice for contractors. An owner or contractor might prefer a CDE over other software solutions for the following reasons:

1. Collaboration and Coordination: A CDE is specifically designed to facilitate collaboration and coordination among all project stakeholders, including contractors, architects, engineers, subcontractors, and owners. It provides a single platform for all stakeholders to store, share, and manage project-related data, documents, and communications, promoting seamless collaboration and coordinated workflows, while maintaining and protecting their independent workflows and data. BIM, ERP, and project management software don’t provide the same level of integrated collaboration features that a CDE offers.
2. Data Centralization: A CDE serves as a centralized repository for all project data, ensuring that all stakeholders are working from a single source of truth. This helps to reduce data discrepancies, inconsistencies, and versioning issues that may occur when using multiple software tools. BIM, ERP, and project management software have their own data silos, which leads to data fragmentation and lack of data integrity.
3. Document Management: A CDE provides robust document management features, allowing contractors to efficiently upload, share, and track project-related documents such as plans, specifications, contracts, and change orders. It ensures that all stakeholders have access to the latest and most accurate documents, reducing the risk of miscommunication or delays. BIM, ERP, and project management software don’t have the same level of document management capabilities as a dedicated CDE.
4. Project Analytics and Reporting: A CDE typically provides advanced analytics and reporting features that allow owners and contractors to gain insights from project data, generate customized reports, and track project performance. This helps in making informed decisions and optimizing project outcomes. While BIM, ERP, and project management software may have reporting capabilities, a dedicated CDE offers more comprehensive and project-specific reporting features.
5. Security Compliance and Standards: A CDE is often designed to comply with industry standards and regulations, such as SOC 2, which ensures the platform  is built to the best practices for data integrity security. A SOC 2 certification must be verified and then regularly audited by an independent third party. BIM, ERP, and project management software may not always have the same level of compliance with security standards.
6. Access Control: A CDE provides controlled access and auditing to project data, allowing contractors to manage permissions and ensure that only authorized personnel can access and modify data. This helps in maintaining data security and confidentiality. BIM, ERP, and project management software may not provide the same level of integrated access control features as a CDE.

In summary, while BIM, ERP, and project management software are valuable tools in the construction industry, a Common Data Environment (CDE) offers unique benefits such as dedicated collaboration and coordination features, centralized data management, robust document management, project visibility and reporting, industry compliance, and integrated access control. A CDE may be a preferred choice for end-to-end, efficient and effective data management in the commercial construction industry.

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Collaboration in particular

Collaboration in the construction industry is a critical, but notoriously challenging, aspect of successful project delivery. A CDE in particular offers a far more effective collaborative environment than other software categories to organize the collaboration of the many stakeholders involved in project delivery. Here are some ways in which collaboration can improve when a contractor uses a CDE:

1. Centralized data management: The centralization of data allows all stakeholders, to access the latest and most accurate information in real-time. It ensures that everyone is working from the same data, reducing the risk of data discrepancies and miscommunication.
2. Streamlined communication and coordination: A CDE facilitates seamless in-app communication and coordination among project stakeholders. Contractors can collaborate with other team members, specialty contractors, and vendors in a centralized platform, enabling the easy exchange of information, clarifications, and updates. This helps in resolving issues, addressing changes, and making decisions in a timely manner, reducing delays and potential conflicts.
3. Enhanced document management: A CDE enables efficient document management, including plans, specifications, contracts, change orders, and other project-related documents. Contractors can upload, share, and track documents in a secure and organized manner, reducing the risk of document versioning issues, misplaced or lost documents, and delays in accessing critical information.
4. Improved visibility and accountability: A CDE provides visibility into the status and progress of project-related activities and tasks. Contractors can track and monitor project milestones, timelines, and progress in real-time, ensuring that everyone is on the same page. This enhances accountability among team members and subcontractors, promoting better collaboration and coordination.
5. Enhanced project analytics and reporting: A CDE often provides advanced analytics and reporting features that allow contractors to gain insights from project data. Contractors can generate customized reports on project performance, cost tracking, resource utilization, and other key metrics, helping them make informed decisions and optimize project outcomes.
6. Secure and controlled access: A CDE provides controlled access to project data, ensuring that only authorized personnel can access and modify the data. This helps in maintaining data integrity, confidentiality, and security. Contractors can control access permissions for team members, subcontractors, and other stakeholders, reducing the risk of unauthorized access or data breaches.

A CDE mitigates many of the entrenched issues owners and contractors contend with by providing a centralized platform for data management, facilitating real-time collaboration, improving visibility, and reducing the risk of errors and disputes. By optimizing data management practices, a CDE helps owners and contractors unlock efficiencies, reduce costs, and improve overall project outcomes.

Conclusion

In summary, contractors in the commercial construction industry currently face challenges in managing data effectively, often relying on Excel spreadsheets which results in data duplication, lack of real-time collaboration, and increased risk of errors. It is well documented that these challenges result in increased costs, delays, and reduced project efficiency.

To address these issues, contractors have several options for managing their data, including dedicated CDE software, excel spreadsheets, or BIM, ERP and PM solutions. Dedicated CDE software offer specialized features for managing project data, documents, communication, and collaboration. Implementing a CDE can provide significant benefits to contractors, including improved collaboration, streamlined data management, reduced errors, increased productivity, and enhanced project visibility. Choosing the right CDE option requires careful evaluation of needs, budget, project requirements, ease of use, scalability, data security, and support for industry standards, with potential training and support for team members to ensure effective adoption and utilization.