There are ever expanding opportunities to generate insights and predictive analytics when project information is digitized and shared. But, have we considered the capital investment required to digitize that information? What about market resistance to data transparency when it threatens their competitive advantage?

According to ConstructionDive, U.S. construction technology investor funding had reached a record $2.1 billion by the end of Q3 2021, doubling the amount invested in the year prior. Yet, construction remains the second-least digitized industry in the world.

Now that it seems we have access to every field app and collaboration software under the sun, it’s time for construction to start dealing with our digital waste. What can we hope to learn from WeWork or Katerra as we look for the next digital “unicorn” of construction?

Removing digital waste begins by identifying it. Digital waste is the quantifiable negative impact of inefficient processes and lack of secure data interoperability between systems within the project delivery ecosystem. Let’s look at the three types of digital waste, from the most pervasive to the most pressing.

Dark data

Also referred to as “orphaned data,” dark data refers to information that’s generated but isn’t leveraged to its fullest capacity — or used at all. Yes, some data should probably go into a secure archive only to be accessed in certain scenarios, like in the event of an audit or to trace back an issue in a project. The diminishing cost of data storage has led a lot of companies to take a “capture everything” strategy, while leaving standards and governance to the wayside.

If you decide to collect everything and dump it into a data lake without any strategy, fishing out what’s actually required when you need it becomes a lot harder… and more expensive.

To illuminate the issue of dark data, let’s look at a mock example of a designer-to-contractor document handover.

In this example, the Project Architect creates valuable design data using the Revit application (1), which is periodically saved back to the central BIM system (2). From there, the Design Manager exports a 2D PDF file (3) containing only a fraction of the BIM data.

All of the content and parameters left inside the Revit model has essentially gone “dark” at the point of PDF export (3). While current liability restrictions may prevent design professionals form sharing all of their BIM data, they can publish to an openBIM standard format (.IFC) or one of several cloud BIM collaboration platforms (e.g., Autodesk Construction Cloud, Revizto, BIMTrack).

Measuring the impact of dark data is tough when the value proposition looks at missed opportunity rather than direct cost. Thankfully, this next form of digital waste has a measurable impact on labor productivity.

Duplicate entry or activity

Nobody likes to enter the same information twice. But, if two different people on the same project enter the same information individually, isn’t that also a form of duplicate entry? The answer may depend on which company you work for. Looking back at our mock design package handoff example:

At a company level, the architecture firm faces duplicate entry when the Project Architect creates information during the update activity (2) that is recreated during export by the Design Manager (3). From a project perspective, information created by the Architect’s Design Manager (4) is recreated upon receipt by the GC Project Manager (5). Individually, the Project Manager could face duplicate entry between documenting receipt of the design package (5) and manually entering that same data into their Procore system (7).

Whenever data is entered or reviewed twice, it creates an excess. If that waste can be seen internally at the individual or company level, then there’s a direct incentive to resolve it. Unfortunately, project level redundancy is only resolved when the Owner – who is less aware of the impact – gets involved.

Data re-processing between project stakeholders is not only a waste of human capital, it’s also a major contributor to “bad data,” the riskiest form of digital waste.

Bad data

In the digital age, even a tiny discrepancy can create a big issue. When it’s just humans reviewing the data, they can differentiate between a small typo or missed punctuation. But as we digitize, it’s important to acknowledge that machines can’t account for those errors as well as humans — at least not yet.

This lack of human standardization can lead machines to place the same data into separate buckets, creating issues in your process and reporting automation.

Let’s look at our example again. Whenever manual data entry occurs, there’s a risk for error or omission. If bad data is entered, it creates a digital disconnect between the Architect’s source of truth (3) and how it’s recorded in the GC’s system (7).

These seemingly minor discrepancies between data project systems are the leading root cause of construction’s lack of digital advancement. According to projections in a recent study by FMI, the construction industry spent over $1.84 trillion in global GDP on rework (waste) due to bad data in 2020 alone.

Beyond the direct cost of data decisions, these data discrepancies lead us to stop trusting it. And when we don’t trust the data, we can’t rely on it for automation or predictive analytics. As a result, we lose opportunities to drive efficiencies and improve insights. Ultimately, there is plenty of technology available today to support construction’s digital transformation. That tech is only as good as the systems we build for them to operate in, though. Until we address the root causes of digital waste baked into our policies and practices, we won’t be able to confidently seize the opportunity digitization presents.

How to Get Rid of Digital Waste

Digital waste can come in three forms:

1. Dark data that gets generated, then sits unused or is not used to its full potential
2. Duplicate entry or activity, like an individual entering the same data into two separate systems
3. Discrepant data — or “bad data” — that it generated because of a human error or omission (e.g., a typo when manually entering data)

This isn’t a construction-specific problem. Every industry faces the challenge of confronting and minimizing its digital waste. But construction companies are in a unique position because construction is one of the least digitized industries. That means we’re still in a good position to catch this issue early — before it escalates.

That, of course, means we need to ask: how do we get rid of these digital wastes?

Shine a light on it

It’s virtually impossible to solve a problem you can’t see or don’t understand. What makes digital waste such a challenge is that it’s usually hidden — whether unintentional or by design.

You won’t notice that you have dark data until you need to search for something and can’t find it. You won't know if an employee must enter data twice unless they feel comfortable telling you. And you usually won’t figure out how “bad” your data is until it’s too late.

Diverting resources to review existing sources of digital waste will not lead to an immediate return on investment (ROI). But, it’s a necessary first step. You might need to deploy a team to review existing systems or practices. You could also create a semi-anonymous form for people to report sources of digital waste and propose solutions. Reviewing your historically bad data is the key to uncovering the root causes that will inform new strategies to improve digital integrity and reduce waste.

Once everyone has a better grasp of the sources of digital waste, it’s time to measure and calculate the holistic impact of these wastes.

Visualize the digital waste

Convincing company executives and project owners to change their traditional mindset and invest in long-term ROI strategies to remove digital waste from the supply chain will not be easy. To do this, we have to speak their language.

If it’s too early to discuss ROI potential, your next best option is to focus on the theoretical cost today of doing nothing to address digital waste. This is done by combining the human capital expense of duplication or searching through dark data (e.g., time wasted x hourly rate) with the risk exposure from reliance on bad data.

From there, you can show a measurable performance gain potential by first calculating the current revenue loss potential (RLP). Visualizing digital waste in this way gives you a way to measure the cost of sticking with the status quo.

To generate the basis for your RLP calculation, you can use the common data exchange (CDX) framework to document the series of activities in the digital breakdown. By creating a simple and safe environment for each perspective to “share their pain,” all impacted parties can visually identify the root cause and produce an RLP calculation to justify the proposed change.

Motivation to tackle digital waste

Because digital waste can exist from an individual, company, or project perspective, it’s important to consider each scenario from the motivation of each perspective. Increasing the level of transparency and accountability starts with individual leaders at the organization level. However, the larger opportunities for digital transformation also require change in culture and motivation at the project level — starting with the Owner.

Looking for even more reasons to tackle digital waste? A McKinsey report recently analyzed productivity growth and concluded that “construction has seen a meager productivity growth of 1 percent annually for the past two decades.” That is less than half of the national average across all industries, according to the U.S. Bureau of Labor and Statistics.

Again, a lot of this can be attributed to the construction industry's lack of standardization, which links directly back to digital waste. When we need the data, we can’t find it (dark data). When we have the data, we can’t trust it (bad data). Once we think it’s more effort than it’s worth (duplicate data), we expose the organization to an ever-greater risk (dark data). Refer back to the RLP graphic if you’re not convinced.

Ultimately, digitization is a slow burn. Organizations that approach it holistically eventually see ROI and a longstanding competitive advantage, but it doesn’t happen overnight. Tracking short-term KPIs in lieu of long-term ROI is a great way to stay on track.

The future of AEC’s digital transformation isn’t always clear and no one has it perfectly dialed in. A great way to gut-check how you’re progressing and pick up digital waste strategies is through industry peer groups. Whether it’s a local LCI community of practice, a software user group meeting, or a CPC Virtual Roundtable breakout, there are so many opportunities to learn from and share with others that are facing your shared pains.

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Nathan C. Wood is the Executive Director of Construction Progress Coalition (CPC), a grassroots non-profit initiative to educate AEC professionals about the need for open interoperability standards between project delivery stakeholders. Nathan’s experience with Virtual Design and Construction (VDC), Lean process improvement, and Integrated Project Delivery (IPD) has led him to realize how even proven technology solutions can result in lost ROI when the needs of people and process are not addressed. Nathan balances his passion for data insights and stakeholder empathy through pragmatic adoption strategy, driving digital standards adoption in design and construction. When not fighting for open standards, Nathan also supports construction transformation as Chief Enabling Officer of SpectrumAEC, delivering speaking engagements, research publications and Design Thinking workshops.