BIM: Making Money

The Hard Sell

BIM is often touted as the ‘silver bullet’ that will win work, make money, reduce time and deliver a better project.
This is the message from BIM conferences, infomercial research papers, self-appointed BIM evangelists and ‘thought leaders’. Much of this information is as reliable and trustworthy as a home shopping TV channel.

Of course, there is nothing wrong with marketing and promotion:  it is just part of sales whether you are buying a new car or some software. The important thing is to differentiate fact from sales-talk.

BIM can make money, but Success is not guaranteed and could cost more than it earns. The promise of success should be accompanied by a long list of fine print such qualifications, exceptions, conditions and other gotchas.

Design & Construction industry characteristics

The design & construction industry is generally characterised by low profit margins and high risks. It would not be unusual for a general contractor to have single digit margins and achieving this is heavily dependent on the project running smoothly (or perfectly..)

  • For contractors, there are likely to be numerous risks that could singlehandedly wipe out the profit margin.
  • Furthermore, it is quite easy for such an issue to occur i.e it is not some freak accident or rare disaster.
  • Finally, against this backdrop of a fragile profit, potential losses are virtually unlimited if something goes really wrong.

BIM can tip the commercial equation towards the black-ink side, but it obviously can’t overcome fundamental commercial, design, method or contractual problems.

The good news is that the construction industry as a whole is only just beginning to unlock the potential of BIM and I am very optimistic for the future.

The promise of BIM

A large number of projects are promoted as ‘BIM projects’ with lofty goals of saving money or producing a better result, without any clear plan on how this will be achieved & measured.

Assuming that new technology is automatically better than established processes or wanting to be seen as technologically advanced, or even the perception that “everyone else is doing it so we need to” can override the common-sense test of being easier, quicker or better.

It surprises me how many organisations will spend significant amounts on new technology, yet not take the time to think how they can get the most out of it in commercial returns.

Replace, don’t add

If BIM just adds work or new processes, then it is extremely unlikely to make money. In other words, there is no sense in doing more rather than less.
The key is to replace processes in order to be more efficient and produce a better result. This might sound obvious, but I see a number of projects where BIM really does not offer much over traditional CAD documentation.

Opportunities

The opportunities where BIM can make money include:

  • Making an existing process more efficient or people more productive. In a construction context, this could allow acceleration of work.
  • Additional capabilities or service offerings i.e something extra to sell.
  • A capability that sets you apart from your competition, to win more work, or win more profitable work.
  • A capability that allows once-off work to be converted into ongoing or repeat work.
  • A capability that reduces risk (such as design or construction errors) and reduced costs such as claims, professional indemnity insurance or construction errors.

Design: the BIM starting point, but a small part of project cost

Considering that the percentage of design costs against the total project cost is often less than 10%, the benefit of BIM is minimal if applied to just design. That is to say: even a massive benefit to design and documentation might make a big difference to an individual design consultant, but it is fairly negligible to the overall project performance.

The biggest opportunity is where BIM can benefit construction i.e. in the 90%+ of project costs outside of design. The penny has not quite dropped in the construction world and BIM is still seen as the domain of design consultants.

Where BIM is used in construction, it is typically used for design tasks farmed out to consultants & subcontractors such as services design coordination, or for fairly vague  purposes such as ‘4D’ & ‘5D’

BIM does come at a cost in software, hardware, development of systems, staff training, initial loss of productivity and so on. If not approached correctly, these costs can reduce, eliminate or reverse any financial benefit.

For example, if design coordination is not a systematic & planned process but has an over-reliance on ‘clash detection’, then the result is that design consultants and subcontractors model and remodel the same work multiple times, the overall effort is probably greater than completing the work once with a pencil & paper.

The MacLeamy curve is a well-worn favourite of BIM, and shows the increasing cost and decreasing ease to make design changes as a project progresses. The challenge is to also reduce the area under the BIM curve (representing effort) so that it is less than the traditional curve.

As I explain in my post on clash detection, if the design process involves premature or concurrent modelling across different disciplines and requires subsequent remodelling, the peak of the BIM curve becomes wider i.e. represents more effort.

Key success factors

  • Planning
  • Ambitious but realistic expectations
  • Replace, don’t add processes
  • Systems such as standards & object libraries.
  • Proper training
  • Ensure everyone has sufficient skills at a relevant stage, regardless of seniority, personal preference or experience.
  • Managers need adequate skills to understand, review and monitor progress in a model environment rather than relying on traditional metrics such as drawings per person per day.

Summary

  • Look at BIM from a business perspective i.e. be very clear on how and where you are going to save time or produce a better result.
  • Don’t fall into the trap of doing something ‘because you can’ or being led to new technology by well-intentioned but misguided technophiles.
  • Don’t believe the hype. You probably aren’t as far behind your competitors as you might think.
  • Good people are more important than complex software. You can achieve a lot with simple tools.
  • Focus on small and achievable goals within fixed timeframes.
  • Commit fully and involve everyone.
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