InSite (magazine of the IT Construction Forum) - January 2007

On-demand delivery

Buying software is an expensive business, but do on-demand software programmes provide a secure and more efficient solution for construction businesses?

When social housing organisation East Thames Group required an electronic document management system, they had two options.

The first, purchase an expensive software programme to co-ordinate and store project documentation. This would involve taking up precious server space and held no guarantees that drawings created with different file formats could be accessed without the expense of purchasing additional software.

The second option was an on-demand software solution, held off site on a secure server. This would give East Thames Group access to all project documentation and drawings at any time of the day or night and would eliminate the need to store documentation on the business’ server. Additionally, further software licences, particularly for programmes that would only be used once in a while, would no longer be necessary.

Not surprisingly, East Thames Group chose the latter option and opted for CTSpace’s (formerly BuildOnline’s) on-demand document management system.

“It made sense to choose an on-demand software solution,” says Lewis Walker, East Thames Group’s Principle Project Manager.  “The on-demand nature of the software means we can access project documentation at any time. We can grant secure access to parts of the system to our project partners, and we don’t have to worry about looking after upgrades or maintenance work.”

Software as a service

For many construction businesses, software purchasing can be an expensive exercise. As well as the initial licence fee, it is necessary to consider maintenance and upgrade fees, along with the cost of providing training for staff. Because of this, businesses are looking for a new way to access the capabilities and services that software provides, but without actually having to purchase any software.

As a result, on-demand solutions, also known as Software-as-a-Service (SaaS), are increasingly being adopted by the construction industry. These applications are accessed via a broadband Internet connection and are hosted on servers operated by the service provider.

Construction-specific applications, including electronic document management, project extranets, enterprise portals and other collaborative working systems, are now offered on-demand and are being taken up by the industry because of the intrinsic benefits they provide over standard software programmes.

The mobile nature of the industry, and the temporary nature of construction sites, mean project managers and partners don’t always have direct access, through secure networks, to the data and project information held within their business.

Storing data in a centrally-hosted repository while allowing access from laptops, or even through Internet cafés – subject to appropriate log-ins and passwords – means users have access to project data any time, any where, any how, says Paul Wilkinson, Head of Corporate Communications at collaboration system provider, BIW Technologies.

The instant access to current project information provided by an on-demand software solution is one of the benefits that House of Fraser found in its trial of construction collaboration technologies. The company recently contracted two members of its supply chain to review BIW Technologies’ BIW Information Channel and found that with no requirement for specialist software or licences, and with information stored on a secure third-party server, savings of up to 2% of the overall capital value of a project could be made.

Total security

However, the perceived vulnerability of a remotely-hosted software service can put some customers off using these applications. Questions arise over the systems’ security and access to essential project data if the service provider fails.

“Losing control of data security processes was one of the key concerns we had in adopting an on-demand document management system,” says Roger Stone, Project Controls Manager at Aspire Defence, a company set up to deliver an £8 billion construction and facilities management project for the Ministry of Defence.  Aspire is using CTSpace’s on-demand document management system to store and manage project documentation and drawings.

“To hand over to a supplier a task that is absolutely central to our business requires a great deal of trust on our part,” he explains.

This trust should be built through clear service level agreements, says Anna McCrea, Senior Consultant at Davis Langdon Management Consulting. “With more companies using external data farms, system crashes and downtime are out of their hands and it is important to have detailed contracts that legally set out the terms of service.”

However, she warns that there is no single straightforward agreement that will fit each business and stresses that individual service level agreements are necessary. “Users and vendors need to be aware of all of the variables involved in operating an on-demand software service before entering into a supply contract.”

Security of the service is also something that needs to be considered before choosing software offered on this platform. Aside from the potential for data to be hacked, secure access for all levels of project team member needs to be assured. “If data is compromised a business can lose its competitive advantage, it can lose credibility and its position in the market can be compromised,” cautions McCrea.

On-demand software vendors, however, are quick to defend the security of their systems and their contingency plans. BIW Technologies, for example, has an agreement with the National Computing Centre to put its software code in escrow and has an arrangement with its hosting provider so that, if the company went bust, customers would continue to receive the service for three months and could make alternative arrangements.

Looking to the future

So what does the future hold for the on-demand, SaaS model of software delivery in the construction industry?

Recent research from IT analyst firm Gartner says SaaS is expected to increase to 25% of business software revenue by 2011, up from just 5% in 2005, as the delivery model becomes increasingly accepted.

Gert-Jan de Kieviet, Managing Director North EMEA at CTSpace concurs with Gartner’s’ prediction of increased uptake of this delivery model. “The construction industry is a lot more innovative than a number of other sectors when it comes to the use of IT. It has already accepted the on-demand model as a long-term solution and as an integral part of its application portfolio,” he explains.

However, this does bring a range of new questions to the table as businesses expect to be able to integrate the on-demand solution with their existing, internal, application portfolio. With the increased web ability of many standard applications, it is becoming easier to integrate on-demand solutions and the IT industry is now beginning to respond to this need.

While the on-demand, software-as-a-service model is increasingly being used, construction businesses should still investigate the options available to ensure they choose the solution most suited to their systems and business practices.

BIW Technologies and CTSpace are IT Partners of The IT Construction Forum.