Construction Payment Complexity

The construction industry seems to always be up against unique challenges, it always has. It is common to run into challenges and changes before a project has even broken ground. This is despite the fact that projects are usually planned well in advance with a great detail.

With a slew of unexpected changes, keeping on top of what’s changing and the cost associated with each change is extremely complex. Two worlds which must exist together in order to complete a project are the construction and the accounts payable teams. Every line item and change must be documented and approved. A director of construction, project manager and accounts payable team must work together at the end of each month to understand what is done and what needs to be paid, but their preferred methods of processes and communication can vary and sometimes information falls through the cracks.

No one plans on making mistakes, no one plans on overpaying someone and no one wants to be the one at fault for delaying payments at the end of the month. But if things aren’t tracked and handed off easily, mistakes will be made, afterall we are human! In construction we often hear that teams or departments are blocked either by people and/or information especially during the verification process; this can be extremely frustrating. Sure softwares can help to some degree and exist to assist in things like document management for revisions or accounting, and even though data can be connected within these systems, are they really working together? Are they really helping to bridge the gap between different teams in construction, or dividing them further?

In construction, teams shouldn’t be blocked by manual inefficiencies. Organizations have teams, these teams directly depend on each other. Teams should be able to work off the same data set, in the same workflow, to get contractors and trades paid more efficiently and accurately. If accounts payable has all the same reference points as the project team, it should remove the question of “this invoice can be paid, or can’t be?”

I’d like to leave you with this final thought, picture a relay race and the baton can only be passed from one runner to the next, there’s no other way. Each team member has a role, and the relay can’t be finished if one team member doesn’t pass the baton. How do teams in the construction industry pass the baton the same way, can it be done?

Harbr analyzes live performance data for the construction industry.