Deltek Clarity Report findings - with Megan Miller

Megan Miller is the Senior Product Manager for Deltek – a global provider of software and solutions for project-based business. We caught up with her to delve into the background and results of the global Clarity Report that looks at trends and benchmarks in the architectural and engineering industries, including a focus on EMEA and APAC regions. 

Megan Miller

Megan, what's the purpose of the report?  

The report focuses on industry trends and benchmarks. It's also an analysis of the overall impact of technology on architectural and engineering firms. This year, we expanded the study into the APAC and EMEA regions for the first time so that we could provide a more holistic look at how technology is impacting different geographies. The report will give global companies, or those that are interested in exploring worldwide trends, another metric to benchmark themselves against. 

What data was captured for the reports? 

The survey captures responses on emerging technology trends, perspectives on digital transformation, challenges firms are facing, and reaction to questions on benchmarks and KPIs. The EMIR and APAC reports collated data from 600 individual decision-makers from eight countries within the two regions. The APAC report includes responses from Australia, New Zealand and Singapore, while the EMIR report had the reaction of businesses in the UK, Germany, Norway, Denmark and Sweden. The expansion of our data capture area allows us to analyse a range of perspectives from firms of different sizes and geographic regions.  

What penetration has technology made into the architecture and engineering industries? 

As this is the first year we surveyed the APAC and EMEA regions, we're very excited to have the opportunity to track future trends and the impact that technology will have on the industry in those regions. That said, there are very few areas of the industry that haven't been impacted by new technology in the last decade. Companies have dramatically changed the way they undertake design work and how they manage information presentation, which makes project management more effortless. Many businesses are moving to paperless billing and are making significant changes to how and where workers can access the information. Laptops, tablets and mobile devices are the norms in the architecture and engineering industries, and there have been massive changes to the range of information that is available on electronic devices from what we saw ten years ago. From a project perspective, companies are making significant differences in the way they design projects including the use of BIM modelling, improved surveying tools, better CAD technology and leveraging the cloud for information sharing. As we continue to monitor these trends, I believe we'll see tech that could be considered emerging now, further transforming the industry in the decades to come. 

What impact have millennials had on workplace practices? 

For the most part, the millennial's perspective is based on their expectations of what technology will be available in their working environment. Many millennials are immersed in computer technology from a young age, and they expect it to be part of their world rather than as a nice to have. In many cases, the expectations of millennials have become the catalyst for companies to embrace new technology and provide more accessibility for remote working. It has created a more flexible working environment. As a higher number of millennials enter the workforce and begin moving into management roles, what is considered to be the norm now is coming under increasing scrutiny.

How does the implementation of technology affect business profitability? 

There will often be an up-front investment in technology, but there can also be a high return on that investment. For example, implementing technology into your billing and invoicing systems can save a tremendous amount of time. Still, you must ensure that managers and billers can review the information, make updates and send electronic invoices instead of having paper change hands. When implementing emerging technology, you need to think about how your teams can leverage things like machine learning and artificial intelligence to take care of some of the typical manual processes. It'll free up time for your teams to focus on problem-solving and the delivery of projects that will increase the profitably of the business. 

How is the growth of AI viewed by the sector? 

Artificial intelligence is one of the top five most important technology trends that has been identified in this year's report in terms of the impact on a business. It's also listed as one of the top technologies that C-Suite managers recognise as trending upwards. That said, it was interesting to note that there is a marked difference between how architectural and engineering firms rate the importance of AI. The engineering sector is more likely to consider AI as very important to their business, with 72% of respondents indicating it is important. However, just 44% of architectural firms said that the same technology was important. The difference in responses may be because engineering firms are not only involved in design but also the building and maintenance of assets. It is possible to leverage AI a little more in the build and maintenance area than in design.   

Is the level of understanding of technology a growth area for the sector? 

The EMEA and APAC reports show that firms often rank themselves as having a relatively high understanding of technology trends, and they have also identified technology as being very important to their workplace. There may be opportunities for firms who rank themselves highly in the understanding of technology metric to dig further into the trends and uncover features such as machine learning or natural language processing that they may not be using at the moment. Overall, we believe there is an increase in the level of understanding of the value of technology, and we will continue to watch those trends over the coming years. 

Did the respondents identify any challenges with the current technology?  

Some of the biggest challenges facing companies when it comes to emerging technology are prioritisation. Before the implementation of new technology, you must have a robust strategy in place, champions must be identified, and a suitably sized budget available. While many firms indicated they have a clear understanding of their digital transformation strategy, most are still in an early stage of maturity in the process. One of the other main challenges for companies is using what they already have to its fullest and understanding that just doing upgrades to the current system isn't enough. For example, with paperless billing that I mentioned earlier, it's not emerging technology per se; it's an enhancement to the technology that many companies already have. When companies go through a technology upgrade, they turn off some of the innovations that can help their business but never return to activate them. One of the questions we asked this year is how much reliance companies are placing on spreadsheets and manual data entry. On average, 77% of our respondents say they are mostly or entirely reliant on manual data entry for accounting. The majority of these companies have some financial management or ERP systems, but they still complete much of there financial work manually. It comes down to making sure that you understand how technology can help with some of the challenges that your teams are facing in terms of the project and financial delivery.   

How do companies identify what new technology will suit their working environment? 

The first step is to understand what new technology is available and how it can improve your business outcomes. The next step involves people. You must make sure that that you have identified the correct people to become champions, how they can help educate staff on the benefits of the new technology and how it can be applied to projects. The successful introduction of new technology is a combination of having a robust strategy, the budget to do the job and making sure that the project doesn't stagnate.  

What did the survey show about the level of collaboration within businesses? 

This question looked at the level of collaboration and communication between departments. Interestingly, only 39% of the firms claimed to be connected while just two per cent described their departments as entirely integrated.  

Almost all of the respondent companies should be focusing on collaboration, coordination and communication in everything they do, but many have what we describe as internal silos. That is a term used when departments are not working well together, don't have strong cross-functional co-operation or have insufficient processes that allow them to work together seamlessly. On the flip side, several firms indicated they had excellent cross-functional co-operation, the ability to transfer knowledge between groups, and their team members are some of the key facilitators that drive successful project outcomes.  

For most companies, improving communication will come through identifying the barriers that are preventing a fully integrated collaboration process. Developing a fully integrated team environment is becoming more critical as businesses have a growing number of remote employees and dispersed workforces. Management needs to focus on how to breakdown those silos, encourage collaboration, give workers the tools and technology to support their job and make it easier to work across teams, sectors and levels within the company.  

How well are companies doing with their KPIs and benchmarking? 

It wasn't surprising to see that companies are measuring a wide range of metrics depending on their business. Many companies were tracking the standard range of metrics, including margins and profitability. However, I believe some companies could realign their tracking to focus on benchmarks that better support their business goals. I am regularly asked by businesses what the top five tracking metrics are. Part of my recommendation is they should figure out which metrics are most useful in driving change within their company. If utilisation is a problem area, then that is one metric that should be tracked. Should you be monitoring attrition within your workforce as your business adapts to changing local and international pressures? 

Interestingly, employee turnover was one metric that wasn't tracked as much in the APAC region as it was in other areas of the world. Once you have collected your data, the next step is to determine how you use it to improve your business. Are you using the information to drive change within the company? Could the data be a catalyst for internal conversations, or is it just one of those numbers that you look at periodically and then file away for another day. 

Read the Clarity Report