Posted on: September 17, 2018 By: CNSG Marketing
If you haven’t heard already – CNSG’s The Converged Effect program works to dive deep into the industry-specific challenges our customers face with procuring technology in today’s times. Each month, our VP of Strategy Devin Williams focuses on a particular industry, to deliver industry-specific tools and resources designed to help you with each phase of the sales cycle. Looking to watch the full Construction and Architecture TCE webinar? We’ve got you covered – click here. Let’s take a minute to define the construction industry.
What is the Construction Industry?
- Buildings: The Building construction subset is usually further divided into residential and commercial.
- Infrastructure: Infrastructure is often called heavy civil or heavy engineering that includes large public works, dams, bridges, highways, railways, water or wastewater and utility distribution.
- Industrial: Industrial construction includes refineries, process chemical, power generation, mills and manufacturing plants.
Macro-Level Construction Industry Trends
- Optimistic outlook for 2018: healthy predicted growth over the next 5 years, but the looming and ongoing trade war has made executives much more cautious than they were just 6 months ago
- Lack of skilled labor
- Overall project costs are rising across the industry
- According to according to Research and Markets, 43% of the industry is planning to increase IT investment in 2018-2019. (In part because executives, even at small firms, are starting to look to technology to solve their skill and labor shortages)
- To top it off, material costs are rising, even before tariff wars began
Construction Industry Tech Trends
- Due to a lot of remote workers and temporary locations, the industry is spending on secure, agile and fast connectivity to support businesses
- MPLS is getting replaced at a higher than average clip in construction, in part due to the need for agile connectivity. Cost pressure along with SD-WAN’s splash into the market are also drivers for MPLS replacement in construction beyond just business need.
- Everything is mobile in today’s construction firm; employees, equipment, locations, devices, etc. and in concert with this trend we are seeing more and more firms adopt mobile applications for productivity, safety, operations, building modeling, etc.
- Firms are looking to data and IoT solutions to reduce operating expenses and bolster margins, especially with so many high cost pieces of equipment
- There’s growth of connected job sites and wearable technology, that also integrates to construction management software to help monitor and analyze the job site
- Cloud and HW refresh occurring heavily in the space as companies look to go mobile, support technology driven initiatives
Challenge #1: Remote Everything
- Quickly and securely connecting work sites, sometimes rural and short term
- Securing and monitoring a network with explosive device growth
- Ensuring proper network capacity and architecture to support remote workers who have large, secured files and mission critical applications they need to access
- Ensuring proper communication and collaboration between full time, freelance, office and remote employees
Solutions for Remote Everything
Green Cloud: virtual desktop for those remote and freelance workers and DR to ensure continuity of this remote architecture
Flexential: delivers cloud and compute resources as well as professional services and compliant environments, purpose built to support organizations with remote and edge critical resources
Momentum: they have a purpose built UcaaS and collab solution for the construction industry with use cases specific for your construction clients and their remote workforce needs pre built into the platform
CenturyLink: delivers a cloud based UTM solution so no matter where your people are, their traffic can be protected and secured. very handy for workers who aren’t in the office
Broad Sky Networks: fleet management and remote connectivity solutions that align perfectly to the construction company needs around remote everything and agile connectivity demands
Comm-Core: as a service physical monitoring and security that can be easily moved from location to location as sites turn up and down. Helps reduce theft and insurance costs besides peace of mind and site control for management
MetTel: who can deliver unique solutions for remote workplaces; managed wifi, mutli-carrier mobile solutions, IoT platform, fleet management and a really cool mobile SD-WAN kit for quick turn up needs.
Challenge #2: Rising Costs
- Trade wars and tariffs make the entire market difficult to predict
- The void in labor job supply has caused a 4.5% rise in labor cost in the past 2 years alone
- Key building materials from fencing and forklifts, to raw materials like cement and aluminum had seen huge YoY price jumps BEFORE the tariffs
Companies are looking to new technologies to help combat these rising costs such as:
- AI/Big Data with IoT
- Cloud Technology
- BIM (Building Information Modeling)
- 3D Printing
Solutions for Rising Costs
MetTel again, is a natural fit for numerous use cases which we see in construction. For rising costs, they can provide fleet tracking solutions with consistent savings and sub 12 month ROI. Or TEM for mobile while consolidating plans all with MDM included
Granite: great play on aggregation + SD-WAN to find awesome connectivity savings while driving better network performance and agility
BCN: your aggregation and cost consolidation play for access and network
CATO: get connectivity, plus sd-wan, plus security at a lower cost than MPLS, which as we mentioned is being replaced left and right in construction
Expedient: for cloud and refresh, has hybrid offerings to right size between cloud and colo for your customers and free cost analysis tools so your customers can forecast savings before they even sign the deal
A new one to the portfolio, Centrics IT: they can deliver 3rd party maintenance contracts at a fraction of the cost of existing maintenance, especially legacy or end of support tech.
And finally, another new addition to the portfolio, Flockgen: they provide waste, energy and utility contract consolidation and replacement. Similar to the CentricsIT play for replacing maintenance contracts, you can help you customers find savings with those waste, energy and utility providers by simply getting a hold of their current contracts and providing them to Flockgen for analysis.
Challenge #3: Lack of IT Resources
- 22% of construction firms task IT activities to non-IT employees
- Cloud adoption in construction is the highest in any vertical; 5% higher than the next vertical
- 58% of SMB construction firms rely on mobile devices and apps in the field
- 1/3rd of construction firms have a mobile strategy in place, while 1/3rd have NO mobile platform at all
- The industry is experiencing a collision of increased technology investment and reliance, with an understaffed and legacy IT environment.
Some common failings related to this climate:
- Introducing new and perpetuating old Security risks
- Failing to meet business agility demands
- Compromising service performance
- Reduce or eliminate technology ROI
Solutions for Lack of IT Resources
There are so many different suppliers in the CNSG portfolio that can help with customers who are understaffed in IT. Some generic examples include:
- Hosted communications and call center technologies
- Cloud or managed anything from office 365 and managed workstations to handing off management of entire applications or systems
- SD-WAN to simplify or completely outsource network management
Some specific vendors:
CenturyLink: Security aaS perfect for remote and agile networks but also access and network, cloud, collab technologies in their portfolio, all available as a managed service
MetTel: A great fit for the industry, specifically for lack of IT resources, talk about managed wifi with analytics to deliver connectivity AND visibility, or a complete mobile platform with MDM included
Flexential: provides excellent managed services and professional services and can do so without a reliance on a specific vendor, meaning they can be flexible for your customers’ needs and I love their focus as a company on the edge
CentricsIT: who I brought up previously, their smart hands as a service offering is perfect for customers who have specific one-time project needs like a scramble site issue fix, as well as regular recurring needs that aren’t always easy to forecast such as site turn ups. remember larger firms can have dozens to hundreds of sites live at any time, all of which temporary and on their own timeline.
TPx: a one stop shop for managed everything; network, security, SD-WAN, cloud, office, etc.
Be sure to join us on October 3rd, 2pm eastern, for our review of the manufacturing industry on the next Converged Effect Industry Webinar. Get the presentation for this webinar and other great resources on the CNSG Partner Resource Center.