Workers simply scanned their codes using the tablet to clock in and out.
Lithko Workers simply scanned their codes using the tablet to clock in and out.

Labor productivity is a major challenge facing the construction industry. According to the McKinsey Global Institute, lagging construction productivity costs the global economy $1.6 trillion a year.

Ryan Hale set his sights on conquering the labor productivity challenge as chief information officer and director of strategic initiatives at Lithko, the second largest concrete specialty contracting company in the United States. “We did a roadshow where we went out to jobsites and business units to understand what the pain points of our stakeholders were, and something kept coming up—the way we collected our time and quantity by worker and cost code every single day for every single job was causing a lot of administrative work from the same people we would rather have planning and executing our jobs,” Hale says.

Site superintendents spent their mornings keying data into spreadsheets and then the office administration re-keyed all that data into their ERP. That worked out to 16,000 to 20,000 lines of data that had to be manually entered every week to execute payroll and accounting tasks. Hale knew there must be a digital solution and he wanted to find it.

That’s where my company Penta came in. Hale came to us and shared his concern that our existing mobile productivity application didn’t suit Lithko’s needs because there wasn’t an easy way to clock workers in. Based on Lithko’s feedback, we developed a beta software solution that integrated with our ERP.

Putting the Software to the Test
Hale handpicked a crew willing to do a pilot study to give the new technology a fair shake. The setup was simple: a tablet was mounted inside the jobsite trailer and QR code stickers were placed on the workers’ hard hats. Workers simply scanned their codes using the tablet to clock in and out.

The superintendent was able to see the data come into the software, where he could allocate the time to various cost codes. He could also make sure the data looked accurate and correct any mistakes. The workers no longer needed to write anything down, they just scanned their code and got to work.

“In addition to the cost savings from rounding errors, we have 150 project superintendents that have to enter in the paper time sheet data every day,” Hale says. “If we can save them even a half-hour per day by automating the process, that’s 75 hours per day they can spend better planning projects. It increases productivity to do higher value stuff, and it’s a combination of hard and soft cost savings that’s scalable.”

Hale also estimated that the time spent by administrators manually entering data would be reduced by roughly 50% once the system is rolled out to every Lithko project, adding to time and cost savings across the organization, not just on the jobsite. In addition, while Lithko projected that eliminating universal start and end times would save a projected 3% to 5% in annual labor costs; the pilot study trended toward the high side of that estimate. When expanded to all of Lithko’s projects, the new approach could save Lithko millions per year in labor costs alone.

Partnering for Success
Whether you’re looking to increase labor productivity or trying to surmount any of the myriad other headwinds facing our industry, this example illustrates the importance of open communication and strategic partnership with your technology vendors. If you see tech vendors exclusively as software providers, you may be leaving millions of dollars on the table.