Even though construction has been a significant part of human civilization since the beginning of human progress, it deals with a lot more than just ‘brick and mortar.’ The construction industry deals with copious amounts of paperwork, and hence in this blog, we will find out why AI-powered Intelligent Document Processing solutions are of utmost significance to the industry, especially now.
The construction industry: a document-intensive industry?
Construction is an essential part of human progress and is crucial in determining the quality of the physical environment we abode. Being one of the primary industries, it has witnessed the advancement of technology at every stage, from better methods to newer materials and engineering advances. When it comes to digital transformation, where does the construction industry stand?
To begin it all, construction firms need to process a considerable amount of paperwork. Before starting a construction project, they must process and manage information and data accurately and efficiently. Not just that, it is a very document-intensive process for all the departments, from the owner to the project manager, contractor, supplier, to subcontractors.
While working on a construction project, they need swift access to the latest documents such as contracts, reports, schedules, bids, tenders, regulations, incident reports, drawings, BIM models, blueprints, and much more. Don’t you agree that it is high time to augment the construction industry with streamlined document processing? Solutions such as IDP or Intelligent Document Processing can easily handle the enormous volume and complex paperwork present in a modern construction company. With increased accuracy and agility, approvals will be faster, and work will proceed efficiently.
The present situation of the industry
Even today, many construction companies rely on archaic document processing systems such as paper-based systems, physical folders, and Excel spreadsheets. Even though firms have been managing documents that way for a long time, mainly because that is the only way, they need help understanding the multitude of problems caused by it.
Architects, planners, engineers, and other stakeholders spend a lot of time filling out important documents and paperwork like bid documents, architectural drawings, safety reports, construction contractor agreements, and more manually. Not only is the whole process slow, but there is also a chance of essential documents getting misplaced or illegible over time. Additionally, due to the fragmentation of pre-construction and construction-based paperwork, it is challenging (and many times impossible) to locate documents for variants and internal and external audits.
Intelligent Document Processing in Construction
One of the topmost challenges of construction companies is on-time project completion that too within the budget along with maximum safety and quality.
A staggering 47% of managers still manually process data which involves inputting, organizing, and extracting data from their systems.
Imagine the staggering volumes and the amount of tedious labor that goes into this, not to forget a small error that can also cost heavily. The sector is currently dealing with a wide variety of documents, including bidding documents, architectural drawings, schedules, work orders, insurance, and more. Implementing IDP solutions that automatically recognize different document formats and can handle most of the laborious processes of identifying, pre-filling, storing, and managing digital, printed, and handwritten documents can be the answer to construction firms saving hundreds of hours.
It can also result in wage savings of up to $50,000, given that the average construction worker makes $50 per hour.
Furthermore, frequent changes in construction projects are a common thing. It may occur due to variable factors like material prices and weather conditions, leading to numerous document revisions, making it challenging to determine up-to-date versions. Physical paperwork users must schedule regular checks to ensure participants have the latest documents.
IDP Use Cases in the construction industry
Being cost-effective, accurate, and easy to use, IDP can be revolutionary, especially for the construction firm’s Accounts Payable. Let us find out the use cases in this regard.
Payment interactions with subcontractors:
Subcontractors are one of the many key stakeholders in a construction project. However, subcontractor payments can be hindered due to sluggish approval processes and data entry errors, leading to strained relationships. An innovative IDP solution can help by streamlining invoice and billing procedures, ensuring swift processing regardless of format. Not just that, you can also pre-authorize specific kinds of transactions to accelerate the approval process further. Being AI-enabled, the IDP solutions assure accuracy and thus eliminate worries about transaction errors. This modern approach saves time, reduces frustration, and fosters better collaboration between general contractors and subcontractors.
Change order billing:
Even though they are rarely ideal, changes in scope are frequently necessary. Manually inputting data to reflect these changes could lead to errors or delay the delivery of information to the right people. This can make the process long, tedious, and drawn out.
Approximately 65% of construction managers claim they have missed change order opportunities.
A modern IDP solution can transform the entire process. With advanced IDP, managers can process the time-sensitive change of scope information swiftly and accurately, reaching relevant stakeholders instantly. This efficiency ensures timely decision-making and seamless communication, making change orders better manageable and less disruptive.
Payments for time and materials:
Throughout the course of a construction project, the team has to keep track of a lot of materials and hours. These factors can get very taxing. However, a modern IDP solution can come to the rescue by relieving the team of the bulk of the work while assuring accuracy and thoroughly accounting for each material used and every hour worked.
With an AI-enabled IDP solution, you can reduce straight-through processing (STP) by up to 95% and reduce your accounts payable manual tasks by up to 75%.
Streamlining onboarding new suppliers and vendors with IDP:
New suppliers and vendors typically need new document templates and invoices. Simple format-based IDP solutions will need pre-configurations for recognizing new formats, templates, and manual configurations, making the process daunting and time-consuming. Overall, the process affects employee satisfaction and overall productivity. An advanced IDP solution incorporating Intelligent Character Recognition (ICR) will enable you to process invoices from new regions, jobs, and contractors more faster and easier without manual configuration. The advanced IDP can efficiently distinguish the various document types and automatically route them to the appropriate recipients.
Simplifying equipment rental invoices:
For any construction project, you will need to rent equipment- which means paperwork. Manually processing equipment rental invoices can be a daunting task. Here, AI-powered data extraction- a part of modern IDP solutions, can handle all the paperwork while freeing up time for essential tasks and fostering better relationships in the business.
Streamline financial reporting to customers and owners with a modern IDP solution:
Stakeholders in every construction project want to know the actual cost upfront. IDP solution can help in this aspect. Using an advanced IDP solution, you can generate detailed reports for actionable insights and customize data collections and report building. You can then review the information or let IDP automatically send the reports to stakeholders. You can not only save time but also have customers informed effortlessly.
Data entry using IDP
A significant portion of a construction company’s duties include data entry. It is not only a time-consuming, complex, and expensive process, but it is also a highly error-prone one. The process becomes even more expensive with each error.
Even then, 47% of construction managers still manually enter data, although 59% of them claim that doing so results in incomplete information.
Over two-thirds of surveyed construction managers claim to use a modern IDP solution to make data-driven project decisions and spot potential issues. Relying on AI and machine learning technologies, IDP solutions extract data more quickly, accurately, and autonomously, conserving resources and time.
Non-accounts payable use cases:
Intelligent Document Processing solutions offer a lot more than just accounts payable benefits for construction firms. They streamline critical document processing, including bills of lading (BOL), purchase orders, and also insurance claims. Construction sites are bustling with activity, with new materials constantly arriving. Each new cargo necessitates a new Bill of Lading, adding volume to the paperwork to be processed. IDP solutions expedite data extraction and process the bills faster and more accurately.
Similarly, in the construction sector, insurance claims are bound to happen. Being accident-prone, a lot can go wrong during construction, such as fire, vandalism, material damage during transit, workplace accidents, and more. A modern IDP solution can expedite the time-consuming process of filing insurance claims. Again, with accelerated data extraction, you can save downtime and streamline the claim submission process resulting in quicker payouts for construction-related incidents.
How can we help?
Intelligent Document Processing can make a massive difference for construction firms as they have to deal with huge piles of documents in all sorts of formats and styles daily. Saxon AI offers tailored IDP solutions that are apt for construction firms alleviating all the paperwork burdens. Not only it goes beyond OCR or manual data entry, but it also delivers much faster and with pinpoint accuracy. Apart from accounts payable, Saxon AI’s IDP solution can process construction-specific documents such as excavation permits, checklists, daily construction reports, water well applications, material safety data sheets, and completion certificates as well.
You can also try our intelligent accounts payable solution- a digital co-worker, Emma, who is empowered by Azure Cognitive services and Power Platform to execute all accounts payable requirements.
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