The AGC of America posted its results for the 2016 Construction Outlook Survey. The survey covered many topics, but the section that caught my eye was devoted to IT and software. In it, 41% of respondents said that they intended to increase their investment in software for 2016. The top four areas in which they were intending to invest were accounting software (25%), estimating software (22%), project management software (21%) and document management (20%).
If I had to take a guess, I suspect these areas are a priority because are seen as legal- or payment-driven: accounting for invoicing and receipt of payment, estimating to create revenue, project management for the generation of invoices, and document management for its part in the legal handover of the completed project to the new owner. Knowing that this is where most firms are focusing their efforts comes as no shock–realizing ROI sooner and the potential to earn more revenue that before? The board will sign off on that investment all day, every day.
On the other hand, software that is not revenue-driven saw smaller numbers. Only 14% of respondents were seeking to invest in some sort of human resource software, and 12% in fleet management software. These two types of software address two huge costs to construction companies, but doesn’t look to be on too many radars. Again, if I were to take a stab at it, I’m guessing these respondents have already invested in their revenue-generating software systems and can now focus on the cost-savings side of business.
In an ideal world, companies would have a limitless IT budget and could invest in anything and everything as necessary. In reality, IT budgets are very strict. The survey noted that 58% of companies spend less than 1% of their gross annual revenue on IT. Compared to another survey of publicly traded companies, the average percentage of revenue spent on IT ranged from 3.2-6.9%. (I should mention that a greater spend doesn’t necessarily mean smarter spend. The survey noted that the more successful companies in their survey were more effective with their investments.)
And how abouty you? Are you searching for new software for 2016? Share with us in the comments below.