Does the positive experience of firms like Somerfield mean project collaboration tools have really arrived? Veteran market observer Anna McCrea provides a state-of-the-market report, with an update on standard functionality, current major players, and rate of consolidation. “Construction companies collaborating online may now expect to use two or three different systems, sometimes on the same project ” Anna McCrea
Project extranets became a ‘must’ on construction projects around 2000. From the outset they were surrounded by controversy and resistance from potential users. Now, five years on, project collaboration tools are growing from strength to strength, attract more users, enjoy wider acceptance from the construction project industry and have become a market force in their own right. However, for this to happen, much change was needed. Even providers and developers themselves had to mature as a community in order to stay key players in the construction project market.
A 2003 survey by e-business consultancy Compagnia suggested that the eight leading UK providers alone had a total user community of over 87,000, though it did indicate figures might need to be adjusted to account for individuals using more than one system. This figure is a result of the most recent independent assessment attempt, but is based on data submitted by vendors.
At the outset of construction’s “extranet era” vendors were bringing new extranet tools to the market almost on a monthly basis. However, very quickly, those companies whose revenue models or venture capital support were not sustainable were forced to leave the stage. In parallel, users were demanding improved functionality and usability from the tools that remained on the market, triggering off further development. Slowly, the industry’s most stable and established players were strengthening their positions. According to the Compagnia survey, any organisation using project collaboration online today has either worked with, or is likely to work with, BIW (27% market penetration), Business Collaborator (17% market share), 4Projects (15% market share) and Build Online (11% market share).
But these are not the only players in the market. Smaller companies with a more focused customer base such as Sarcophagus, Causeway, Cadweb or Buzzsaw, are continuing to do well and stay firmly in business.
What kind of firms are buying the technology? Well, looking at the cross section of the decision makers, approximately 80% of users who selected project collaboration tools were clients and contractors, with approximately equal split.
All the players support one or more of the most commonly used commercial models. ASP (Application Service Provision) is one of them, which is the management of a software application as a service, delivering solutions to end-user organisations from remote data centres via the internet or private networks on a rental basis. Another model supports a flexible pricing approach when clients can choose the commercial model which best suits their needs, from outright licence purchase to long-term monthly payments.
Individual providers vary in their willingness to release statistics about their user base. However, from 3400 users from 570 companies at the end of 2000, usage of BIW and 4Projects systems alone grew to 80,000 by the end of 2004. It is probably fair to say that by the end of 2004 over 150,000 industry professionals had experience of using one or more of the leading eight UK products. Adding the users of other vendors’ products and of in-house developed systems, the total user community for web-based collaboration systems in early 2005, was probably somewhere around 175,000. This means that around 45% of construction projects over £5m are now run using online collaboration tools.*
With the increasing use and popularity of the tools among clients and contractors, a construction company collaborating online may expect to use two or three different systems, sometimes on the same project. The exchange and sharing of data on different systems becomes a real issue. Evidence that the community of extranet providers has matured can be seen in the establishment of the NCCTP (Network for Construction Collaboration Technology Providers). The network aims to increase interoperability between systems to enable easy transfer of data through definition and adoption of standards. The Network also provides a single independent body with which clients can communicate regarding the future development of collaboration technology.
Member companies of the NCCTP have agreed an XML (Extensible Markup Language) system that describes the fundamental elements and properties that are common to collaborative extranets. Each company can then export their project data as XML and transform it into the agreed data structure using an export application. Another company can then take that data, translate it as necessary and import it into their system using an import application. This means that there is a full interoperability among all members of the NCCTP, which includes seven companies: BIW Technologies, 4Projects, Business Collaborator, Build Online, Cadweb, Causeway Technologies Ltd and Sarcophagus, the most popular extranets providers on the UK market.
So, functionality of the tools has been standardised. Now, providers are looking for competitive advantage through simplicity of use, suitability to the project size and type, training and support options and pricing strategy. The standard functionality covers automatic email alerts, project document management, viewing all file formats, commenting and redlining of documents and drawings, as well as an audit trail of revisions.
The range of users’ concerns has also changed, with security and business continuity high on the list. However, providers have managed to avoid major hiccups in delivery or performance, or at least those which could make headlines or jeopardise the trust of users and their faith in technology. Minor problems usually relate to user-friendliness, setting up initial protocols and availability of training.
So are collaboration tools here to stay? Absolutely, yes. More and more clients specify them on projects, contractors recommend them even if there is no specific guidance from clients, and government clients endorse them as a tool for improving efficiency. The only remaining question is which one to buy but, with the development of standards supporting interoperability of the online collaboration tools, even this is slowly becoming less of a dilemma. * The latest source of data comes from the book Construction Collaboration Technologies: The Extranet Evolution by Paul Wilkinson of BIW, which will be published by Taylor and Francis in September 2005. |
