2013 Constructech 50: The Next Step Forward in Technology
All in all, it’s an exciting time to be investing in technology. As the market continues to shake out, only the strong are showing that they can survive …”
Sound familiar? Plucked right from the closing paragraph to the 2012 Constructech 50 intro article, these words remain apropos to the market for construction technology in 2013. At the time, the converging trends of data, mobility, and the cloud, coupled with the consolidation among the software community all served as the backdrop to a technology landscape in construction that was forcing the market to take a much different look at IT than ever before. As we fast forward 12 months later, you could say that while much has changed, so much has simply stayed the same.
For instance, consolidation remains very much at play in the construction-technology market. With two major players—Construction Imaging and Vela Systems—being acquired prior to the announcement of last year’s list, this year we see four more players—MC2, PlanSwift, Skire, and Vico Software—exiting due to the same factor.
In fact, you can count Meridian Systems under that category as well.The project-management brand, which was acquired by Trimble back in 2006, now officially falls under the title “A Trimble Co.” In addition, many smaller players have been acquired; and while such moves may seem minor on the surface, they set the stage for bigger and better things to come.
On the surface you could chalk some of these moves up to the typical maturation process of the market. It’s not uncommon to see a flurry of moves in a market coming out of a down phase as major players examine the needs of the industry and make the necessary moves to deliver in the most appropriate manner. Sometimes, these moves happen organically; other times they occur via the outward route; i.e., acquisition.
But a closer examination of M&A (merger and acquisition) activity poses an interesting examination point: Watch out for the unsustainable business model. Truth be told, much goes into serving the needs of the market. Service and support should never simply be lip service, and it is not out of the question to think some tech providers were destined to fall to the M&A trend simply because they did not anticipate just how costly it would be to support a product.
Many times you see a product that hits the market and looks to be something special, only to slowly fade away. More often than not this was simply a case of too fast too soon, without the proper foresight to see what was truly needed in order to serve this market for the long run.
All this being said, it necessitates a long, hard look at the business model of your current construction-technology providers to ensure they have what it takes to be in it for the long run. This becomes especially vital as we enter an era of apps. While many ideas for apps may seem “focused on construction” up front, that isn’t to say the practice is sustainable.
As for trends related to data, mobility, and the cloud, anyone in the know realizes these remain vital disrupters in the world of construction technology. With that in mind, there isn’t a homebuilder, contractor, or owner organization that isn’t concerning itself with at least one, if not all three, trends. As such, the technology providers that need to deliver on such demands are being placed under an even greater microscope these days to ensure promises live up to expectations.
With that in mind, you may notice a certain sort of cleansing that has occurred with the Constructech 50 this year. Companies that have long been considered stalwarts in the IT world of construction are missing. In some cases, they have fallen victim to complacency. While some may be saying all the right things in press conferences and product demos, their actual evolution to meet the needs of the market have not happened at the desired pace. As a result, this has meant others which were chomping at their heels have taken their place on this prestigious list. In some cases these new companies have proven to be hungrier, more determined, and perhaps above all else, more focused on the needs of the construction space, both now and in the future.
There comes a point in which technology providers must start looking at that “market differentiator.” It is the thing that makes them stand out from the pack; the certain level of expertise, sign of commitment, or feature set, among others, that puts them in the most optimal position to capitalize on the new demands of the market.
In many ways, this starts with the idea of data. There is little doubting the fact that information, and having access to that data in a timely and efficient manner, tends to make all the difference in the construction industry these days. It is the very reason why the ideas around mobility and cloud-based computing have taken off with such fervor across the board. Still, when it comes to picking the technology tools that will help enable these things, the answers aren’t always as black-and-white as they may seem. For instance, simply “cloud-enabling” a technology product or giving credence to the idea that your product’s platform can accommodate the mobile environment won’t suffice. Now, perhaps more so than ever before, construction professionals need to be investigating the underlying technology of their software vendors to ensure what they have built can indeed match what they are promising—and more importantly, what you are envisioning.
Then there is the coming trend around “Big Data.” While such a term might not seem fitting to all organizations, the idea of data—no matter what it’s proverbial “size” shakes out to be—still remains vital for the long run. It’s no longer enough to simply fall in love with the idea of being able to collect data from multiple touch points. Nowadays, it’s all about the process of storing, analyzing, and acting upon such data.
That being said, we are beginning to see some major moves from large enterprise players that further establish their place on the Constructech 50. In this coming age of “Big Data,” the process of getting to your information without having to incur the high cost and outlandish level of frustration associated with data bridges will be more essential than ever before. Companies with the foresight to position their technology toolset in the appropriate manner will prove to be powerhouses in construction for the long run.
It’s anyone’s guess as to which words from this intro will be pulled out and examined 12 months from now. But, much like the lead-in to this year’s article, you can bet the themes that develop in 2013 will begin to further coalesce in 2014 and beyond. In a way, the cleansing that has occurred in the Constructech 50 for 2013 is only the beginning. A handful of other companies have been put on call for the next 12 months. Only time will tell how they answer the bell.
To access the full listing, including expanded profiles of select members, of the Constructech 50 click here.