For construction businesses, ensuring compliance across various disciplines within the business can be very difficult.

Between contractors, subcontractors, suppliers, vendors, and internal administrative divisions, there are so many moving parts and disparate management systems that unifying them on a centralised system can sometimes seem impossible. In fact, regulators often collect fines from construction companies for failed inspections, poor safety standards and environmental concerns. 

As regulators improve enforcement across the board, construction businesses are embracing technology to increase efficiency, enable better communication and reduce safety blind spots. However, even with the introduction of software-based compliance solutions, construction firms still struggle to find the balance between maintaining high levels of operational efficiency and establishing good compliance practices. Here are three reasons construction companies find compliance challenging and how they can effectively deploy regulation technology (RegTech) to change their approach to compliance.

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Why construction companies struggle to monitor their business

Inconsistent data collection and storage

Business leaders rely heavily on the data collected at various points of the operation to develop policies and identify compliance gaps. However, this data is often collected sporadically and inconsistently. Despite the availability of tablets and sensors, most on-site safety checks are done using paper checklists. This can create issues for project managers who have to consolidate and analyse this data to provide business leaders with actionable insight to develop project-wide safety policies. This information gap is widened when such data is stored in excel sheets, paper forms and email threads that each hold crucial information. This prevents business leaders from achieving a holistic overview of their compliance programs. 

Poor communication between stakeholders

A Harvard Business Review study found that 64% of remote employees believed that their on-site counterparts made changes to a project without communicating these changes to the rest of the team. In construction projects with multiple stakeholders communicating on their preferred platform, this can be a major issue. Supervisors, contractors, sub-contractors and suppliers often use WhatsApp or email to share information. As a result, large parts of the team might not be privy to the discussions that happen on those platforms. This poor communication can lead to safety gaps being unidentified and unsafe practices to be called out only in private groups and never shared with decision-makers with the power to effect change. 

Lack of knowledge about compliance requirements

Due to the prevalence of the previously stated issues, compliance requirements can sometimes not be communicated to the entire team. While office-based business leaders and project managers are likely to be kept informed of the latest regulation or changing project policies, this information often does not trickle down to on-site personnel. The challenge faced by construction businesses is that these regulations and requirements change from project to project and it can be difficult to create a standardised document or file to share with stakeholders from project to project. 

How RegTech helps construction businesses change their approach to compliance

Ensure consistent safety standards across projects

Software made specifically to help businesses improve compliance standards has found its way into large construction jobs and companies. However, this application is not consistent across various projects. A recent report indicated that slightly over half of large general contractors use software to manage on-site safety for over half of their projects. However, this did not extend to trade contractors, who use software to a lesser extent. The inconsistent use of software means that the quality of compliance fluctuates heavily from project to project. However, when integrated into a construction company’s standardised workflow, software can go a long way in helping businesses standardise processes and policies across projects with different teams. 

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Centralise all compliance on a single platform

The increasing popularity of RegTech means that contractors are more likely to be using software to manage on-site safety and to conduct regular safety checks. A by-product of this is that most construction projects conduct checks on multiple platforms to maintain compliance across various business divisions and external stakeholders. This is inefficient and cumbersome. It also defeats the purpose of having technology aid in improving compliance standards. For this reason, project managers have to ensure that any software introduced to an existing stack of solutions works in tandem with the established workflow. It is important for all compliance to be consolidated on a single platform as it gives business leaders and project managers the oversight needed to ensure that safety policies are being developed and executed effectively. 

Replace a reactive approach to safety with proactive analysis

Construction companies experience an extremely high occurrence of safety mishaps compared to other industries. These accidents often help businesses identify and close safety gaps that have existed since the beginning of the project. However, this reactive approach requires some catastrophe to occur before a change is made. With the help of software-based predictive analytics, business leaders can collect operational data directly from the construction site and analyse this data in real time to predict compliance issues early. A predictive approach allows businesses to be alert to warning signs such as overworked employees, missing safety checks or inconsistent safety training, helping them prevent monetary fines, downtime and lost productivity.

Why a holistic approach is key to the success of compliance automation 

When adding new technology to an existing stack, businesses can be overly focused on ensuring that the individual software is efficient and includes features suited to their needs. However, the interplay between the various hardware and software that already exists within the company is often ignored. Introducing RegTech without considering its impact on the existing technology stack can entrench inefficiencies and create more conflict between stakeholders on a project. When compliance software is compatible with and fully integrated into other software solutions, business leaders can connect information silos, improve data collection and consolidate compliance on a single platform.

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Author Bio

Tom Stemm is the CEO/Founder of Ryvit. He was inspired to build Ryvit when several of his clients in the construction industry had asked for some custom integration development work. At the time, Tom was part of the founding team at GadellNet (a fast-growing IT consulting firm in St. Louis, MO), and they realized that there was a significant gap in the construction tech industry – namely that, while tech purchases were high, the adoption rate of those solutions throughout all stakeholders was still lagging. After a very diligent launch process, Ryvit was born to address the rampant problem of a disintegrated tech stack in the construction technology space. Tom continues to lead a team of integration developers, application enthusiasts, customer heroes, and sales superstars on a mission to eliminate duplicate data entry and rampant data errors from the construction technology world.