Web Exclusive: Purchasing Right Information System Takes Planning
“Most construction companies are not experienced directing or managing a resource as complex and pervasive as computers and systems,” said Burger, president of Burger Consulting Group (Chicago, IL). “Most find technology confusing, frustrating, and expensive.”
Burger tried to supply directions through the technology maze in his presentation, “Leadership and Technology: Managing the Contractor’s Information System” at the 2002 Mechanical Contractors Association of America (MCAA) convention, held here recently.
“Most construction companies do not have enough or the right people in place to adequately manage technology or its use,” said Burger. This got more than a few nods from seminar attendees. “And many struggled with their first selections and implementations.”
So what to do? Burger suggested that construction companies p-l-a-n. “It’s necessary in order for you to get the systems you exactly want and need,” he said.
“The goal is to work toward a single information system vision. You should try to have alignment of business objectives and strategies with system and technology directions. Know your organization. Establish realistic time frames and budgets. And gather information from vendors and other contractors.
“By planning,” Burger continued, “you come off with a platform, a foundation, on which you can build your entire business.”
IT TAKES TEAMWORKTwenty-five to 20 years ago, only the largest contractors had computer systems; 15 years ago, many contractors were buying their first PC for accounting; 10 years ago, contractors were on their second generation of accounting systems and beginning to implement estimating; and five years ago, the Internet was an abstract idea for many.
“It’s not like you have a decade of experience to build on, in respect to technology, on how to handle your business,” said Burger. “This [technology] is a new resource, a new concept. It takes some research and planning.”
For instance, he noted that many, if not most, contractors have a system in place for accounting and job costs that is not associated with other facets of the business, including human resources, equipment management, billing, service management, and tool tracking. In each area, different types of hardware and software are used. The systems are not interlinked.
“Today companies realize that this is not an effective way to build systems and maintain them or, more importantly, to keep pace with technology,” he said.
Doing homework is important. In the preselection process, contractors need to iron out management expectations, points of integration, overall system structure, know existing infrastructure, get organizational experience, compile vendor candidates, and discuss overall strategic issues, including producing a preliminary budget.
“In order for this to be successful, you must get broad participation, well-defined requirements, a structured process to make things happen, get thorough demonstrations, and adequate reference calling,” he said.
In the participation category, Burger recommended selecting a committee to set objectives (which should include management expectations, scope of project, and measurable objectives), analyze needs, prepare a request for proposal, and analyze responses. “By bringing more people in, the better the chance of [the new system] being accepted,” he said.
In the selection process, Burger said every would-be vendor should provide demonstrations and customer references, which committee members should contact. If contracts need to be signed, they should go through legal review and all costs should be identified. A decision can then be made, he said, after reviewing input from all sources.
With management’s stamp of approval, the committee should conclude with an implementation plan, maybe even offering optional technical workshops or a conference room pilot. “To cut back on training is nearly criminal,” Burger said. “Please make sure that is incorporated in your budget.”
DON’T FORGET TRAININGWith today’s software, Burger noted many programs are structured, others are flexible, some can be tailored, and still others can be customized. Know that you will pay more going from the former to the latter, he cautioned.
When exploring software vendors, he said a vendor’s development direction should be considered in the equation along with services provided by the vendor, how its product or system integrates with other systems, and the availability of power tools. “It has to be consistent with corporate direction and strategy,” he said.
Other system considerations, he said, include the level of decentralization; ease of use, to a degree; flexibility and power; implementation effort required; security, application, and database; stability of platform; infrastructure requirements; and use of graphic software over WAN.
Burger said licenses and contracts should be scrutinized. Be careful of limited warranties and limitations of liability. Make sure there is telephone and software support. He said you can negotiate caps on increases in support or new-version pricing.
“If there is a new version of the system or software that is going to be released within the next year or two, and there is a chance that they are going to charge you for that and not make it a part of your ongoing maintenance agreement, make sure you incorporate the language in there [the contract] that lets you get the conversion without any additional cost,” he said.
Zeroing in on the make-up of the planning committee, Burger said a project manager should be so designated, along with appropriate application team leaders. Accountability should fall on these peoples’ shoulders. Ideal team leaders, he stressed, are open minded, see the big picture, are consensus builders, and “understand the value of what is being done.
“They do not necessarily have to be the most technical [minded],” said Burger.
Being live on a new system does not mean you are finished, either. Burger encouraged training on meaning, not just use; providing ongoing training, so as to explore “advanced features”; and eliminating off-line systems and processes.
Sidebar: Burger’s Conclusion
Publication date: 03/18/2002