By Jeff Adams, President and CEO, Redland Brick
The construction industry is not unlike any other when it comes to technology. We are all victim to the adoption curve in one way or another. The real challenge is finding ways to shorten or match the adoption curve in the interest of more sales, better efficiency, superior quality, or whatever the objective of the new technology along with knowing when to adopt a technology based on our own situation.
The adoption curve is generally considered a normal distribution curve comprised of the following groups: innovators, early adopters, early majority, late majority, and laggards. Innovators typically comprise approximately 2.5 percent or the leading tail, early adopters account for about 13.5 percent of the leading edge of the curve, the early majority comes in at 34 percent, the late majority at 34 percent and the laggards at 16 percent.
As we make decisions about which technologies will serve us best in the construction industry we should be careful to remember the adoption curve and the types of people that make up the categories. Whether you are working in business to business, business to consumer, or adopting technology internally to strengthen your performance, consider where your target group falls in the adoption category, whether they can be moved, whether they should be moved, and the resources that might be required to move them.
For instance, many companies produce far more products than can be shown in a retail space. How do they get their products in front of the consumer? Major brand stores are finding that virtual displays outperform standard displays. After four years of testing, Adidas showed that footwear sales increased more than 40 percent in stores with virtual displays which allowed consumers to view the entire range of footwear available.
The brick industry is one component of the construction industry with technology initiatives across the spectrum
However, that study also identified that the majority of those shoppers were mobile shoppers clearly in the leading edge of the adoption curve. The study doesn’t indicate the entire consumer base of Adidas footwear customers and their propensity for technology adoption.
When we decide which technology to invest in, we have to be thinking about the return on that investment. What portion of our customer base is an early adopter or early majority? If we invest in a mobile application; how many of our customers will actually use that application and how will it drive our objective, whether that objective is more sales or efficiency.
When faced with a new technology that will improve our efficiency, we have to understand our own organization and the culture; hence people, of our organization.
The brick industry is one component of the construction industry with technology initiatives across the spectrum. Like the rest of the industry, the brick industry was hit hard by the Great Recession. In 2005, the industry shipped over 9.4 billion brick. In 2011, the industry bottomed at 3.2 billion brick shipped and is poised to ship approximately 4.5 billion brick in 2015, still half of 2005. Like the rest of the construction industry there has been a mass exodus of skilled labor in every piece of the supply chain. From skilled factory workers to seasoned sales representatives, there are less skilled workers available. Engineering News-Record reports that the Skilled Labor Index has steadily fallen from 4.3 percent in 2005 to 1.9 percent in 2013.
No doubt, as the construction economy mends, the pressure will be on technology to fill the gaps. Forward thinking masonry contractors are beginning to invest in robotic brick laying systems developed in the last five years as they recognize the dwindling pool of skilled masons, these early adopters will no doubt have significant investments in the learning curve; but stand to reap rewards as they compete with the later adopting masons.
However, later adopting masons without the resources to be on the leading edge may also benefit from the lessons of the early adopters. Each firm will have to determine the right time to invest based on their resources, culture, and customer base.
One probably doesn’t consider brick manufacturing as a highly technical manufacturing industry. However, that is an incorrect assumption. Brick manufacturers are highly automated in most cases and constantly looking for technological improvements to improve quality and reduce manufacturing cost. Whereas Human Machine Interfaces (HMI) used to be rare, they’ve become the norm and the quality of workers required to troubleshoot and operate the equipment has grown. Where maintenance engineers used to need welding, machine, and mechanical skills, they are being supplanted by those with programming and electrical skills. Installing the technology without personnel keen on technology can and has been met with disastrous results.
Nowhere is the technology adoption curve more at work than in sales. The sales process is filled with 20 year old to 80 year old sales people, customers, and influencers. Some expect instant gratification being able to answer any question with an app from their mobile phone while others insist on a telephone conversation with an experienced customer service representative. Some still prefer the eyeball to eyeball deal making that was mainstream during the Madmen era. In many ways, the sales process is a wild west of technology and it is the management and company that recognize which technologies fit which sales representatives and customers along which area of the adoption curve that will no doubt get the best return on investment from their technology and land the most sales.
The bottom line is that the efficacy of any technology solution is determined by its adoption. The smart organization will consider where the company and the customers are on the adoption curve prior to an investment so that the investment can be maximized.