Tracking Infrastructure

In our newsletter published this week, the article that received the most attention was titled 'Why Precast Should Pay Attention'. This was our title applied to an article that we circulated about a Cleveland, OH contractor's decision to offer integrated construction services. It obviously struck a chord, so we thought we would re-frame it as a question and respond with a deeper dive into how integrated construction is a threat to the precast industry.

In its 2017 report entitled Reinventing Construction: A Route to Higher Productivity, the McKinsey Global Institute revealed that the construction industry lags all other major industries in productivity. In fact, the construction industry experienced a productivity decline of almost 1.5% per year from 2005 through 2014. In this, our third in a series of blog posts drawn from our recent web report, The Promise of Smart Infrastructure, we discuss the ways in which development of smart infrastructure will induce the construction industry to become more productive.

We have heard (separately) from two precast manufacturers that it costs $25,000 to conduct an inventory count. If there is one process that immediately justifies automated data collection, this is it.  While the cost naturally depends on the size of the yard... they both have yards of about 40 acres... automating inventory counts for yards of any size will produce obvious savings. RFID tracking is the solution to this and, with a few kinks to work out, there are a few ways that this will happen.

There is a lot of talk about "smart" things, infrastructure included. But what does that really mean? We have recently released a new web report entitled The Promise of Smart Infrastructure. In it we answer this question and present the opportunity that smart infrastructure provides for addressing the investment gap that exists between current spending on global infrastructure and the (much greater) need for new investment over the next 20+ years. During the next few weeks we will offer a series of blog posts presenting sections of the report.

At the Smart Cities Connect conference in Denver last week there was discussion about how to make the most productive use of the enormous amounts of data that will be connected as cities implement smart city initiatives. Dell EMC's Chief Technology Officer, Rob Silverberg, said that cities should consider creating a singular data platform for collecting all data rather than  creating information silos that will ultimately need to share data. He suggested a "system of systems" strategy for creating a holistic smart transportation system rather than a series of individual initiatives... such as smart parking, smart lighting, etc.

This strategy is not unique to smart cities. With data collection and analysis becoming central to improved productivity, data centralization is critical to most industries these days. This includes the manufacturers that provide cities with their infrastructure.

With The Precast Show 2019 in the books, we've taken stock of our conversations with producers and distilled what we've learned into a list of top-of-mind issues for the precast industry. We will present them in two posts separated categorically into the broad topics of productivity and technology. Today we will start with productivity challenges we observed in our conversations.

Late last year the National Precast Concrete Association released its 2018 Precast Industry Benchmarking Report, a report based on a survey of membership that describes the state of the industry and offers performance metrics for precast concrete manufacturers. This is a valuable resource for the industry and one we purchase every year. The 2018 report includes interesting data that we found very consistent with reports we have heard in our own discussions with precast producers. One glaring statistic jumps out as an immediate opportunity to grow profits. 

It is the new year, a time that we all take stock about what has been and think about the future.  As we gave pause and reflected, a very clear (and, in hindsight, obvious) picture emerged: Before we know it, the manufacturing environment will experience the same relational shifts that we've seen with consumers since the early 2000s. (In this age of consumer technology, consumer adaptations always precede business adoption.) Here is what this means.

One of the most enjoyable elements of our work is that we get to visit precast plants. It is always enlightening to talk to the principals about how they manage their businesses and learn what they do to continually improve. Most often we hear about time- and cost-saving practices being applied to help their companies make more money in very tight bidding environments. Last week I traveled to AJ Foss (Farmington, NH), a very innovative, family-run company with a story of a slightly different twist.

We don't usually promote our products or services in the lede of our blog posts, but we are so excited about our new Idencia 101 program that today is the exception. On January 7, 2019, the first group of precasters will start this guided, self-managed program that will leave them skilled in implementing their plants with RFID tracking. They will be heroes for saving money by reducing paper, enhancing inventory management and expediting shipping documentation!

We've received some great questions about the program so we thought we would address them in this post.