VERDICT

VERDICT is an Internet-based prototype application that assesses the overall e-readiness of end-user companies and profiles the companies in this regard, based on their responses. The name, ‘VERDICT’ reflects the overall aim and purpose of the application. VERDICT is developed to aid construction sector end-users to gauge their e-readiness for using e-business technologies such as Web-based collaboration tools. It can be used to assess the e-readiness o{ construction companies, department(s) within a company or even individual work-groups within a department.

VERDICT Model

Several research publications and articles indicate that people, processes and technology are the three key aspects that need to be considered for successful implementation of technologies. Emmett (2002) siates that together these three elements create business value. However, he further states that ‘the people, processes and technology need a leader’, just as ‘an orchestra needs a conductor‘. Emmett draws a parallel with the performance of an orchestra and states:
‘in an orchestra …. You’ve got musicians (people), musical scores (process), and musical instruments (technology). But without a conductor, they’re more likely to produce noise than music. Even if everyone in the string section plays the right notes at a relatively similar tempo, creating a symphony requires more than following the sheet music.’
Therefore ‘…. An orchestra needs a conductor’. The same analogy can be applied to the adoption and implementation
of new and innovative technologies within construction companies. The ‘conductor’ in this case is the management. To successfully implement and use any new technology it requires management buy-in and belief in order to plan and drive policies and strategies. The research findings from an industry-wide survey and case studies, complement this view.

The case study findings identified management buy-in and leadership as a critical factor affecting the adoption of technology within construction organizations. The adoption of any new and innovative technology (e.g. e-business, e-commerce) within an organization/department/work-group requires total commitment from the management (or group leader). It is important for the management to buy into the technology to lead the business into successfully
implementing and adopting the technology (i.e. the management needs to be e-ready). Thus a fourth category,’management’is necessary.

Taking this into account, the verdict model has been so structured that for an organization to be e-ready it must include:

  • Management that believes in the technology and takes strategic dynamic measures to drive its adoption, implementation and usage in order to derive business benefits from the technology. Processes that enable and support the successful adoption of the
    technology.
    o People with adequate skills, understanding of, and belief in, the
    technology.
    o Technology tools and infrastructure necessary to support the business
    functions (e.g. processes and people).

All four categories are considered important for an organization to be e-ready. A company cannot be e-ready if it satisfies the requirements of just one category and not the others. For example, even if management, processes
and people are e-ready, the fact that the technology infrastructure is inadequate will affect the overall e-readiness of the organization. This example indicates that the company will need to address its technology issues in order to be e-ready. Drawing from the orchestra analogy, ‘a memorable symphony performance doesn’t happen when the players just assemble with their instruments and scores.’ and,’the orchestra with the most violinists isn’t necessarily going to sound the best.’ Similarly, all four categories – management, processes, people and technology – need to work hand-in hand
and symbiotically (see Figure 4.2).

Many organizations fail to realize that installing a system without first achieving universal buy-in and changing business processes, will result in a software installation, not an implementation of a comprehensive solution to business problems. According to Larkin (2003), if an organization merely completes an installation by automating inefficient processes, it will not realize a long-term positive impact. A successful company wide rollout includes more than simply buying and installing software.

It requires the management to align people, processes and technology to implement a solution that meets business needs. The result is the ability to capitalize on the full potential of the technology. investment. Thus, the implementation of new technology needs to be carefully managed and orchestrated. Companies should recognize that in order to successfully implement and benefit from new technologies such as e-business, it is
essential that the people (who are the ultimate users of the technology) and the process are given due consideration. The technology within the company also needs to be assessed in order to ensure that the company has the necessary infrastructure (ICT infrastructure) to use existing and new or emerging technologies successfully. Further, the company needs clear leadership and direction that is provided by the management in order to successfully implement the technology. These four categories are described in detail below.

Four key elements for an e-ready organization
Figure 4.2

Next Page: Four key elements for an e-ready organization

Review of Readiness Assessment Models

An increasing number of readiness assessment tools have been developed over the last few years. On the surface, each tool gauges how ready a society or economy is to benefit from information technology and e-business. However, according to Peters (2001) the range of tools use widely varying approaches for readiness assessment, including different methods for measurement. Each assessment tool or model has a different underlying goal and definition of e-readiness. While some gauge the readiness of countries and economies to adopt Internet technologies on
a global platform, others are more focused on assessing the readiness of specific industry sectors to adopt Internet technologies.
Several readiness assessment models were reviewed as a part of this study, including those that were not construction-specific. Harvard University’s tool called the ‘Networked Readiness Index’ assesses a country’s capacity to make use of its ICT resources. It defines e-readiness as the degree to which a community is prepared to participate in the networked world including its potential to participate in the networked world in the future. On the other hand, APEC’s (Asia Pacific Economic Co-operation) E-Commerce Readiness Initiative focuses on government policies for e-commerce. Mosaic’s readiness assessment tool aims to measure and analyse the worldwide growth of the Internet.

While these tools focus on assessing readiness of countries, governments and policies for adopting Internet technologies, some others for example SCALES (Supply Chain Assessment and Lean Evaluation
System) assess the readiness to adopt different concepts or approaches for engineering (e.g. readiness assessment tools for concurrent engineering (CE). SCALES was developed for a specific industry sector – the
manufacturing industry. It was designed to assess a company’s (especially SMEs) readiness for adopting lean manufacturing techniques. RACE, on the other hand, is a readiness assessment tool for CE and is widely used in the software engineering, automotive and electronic industries.
Two other readiness models that are of particular relevance are the BEACON model and the IQ Net Readiness Scorecard.

  1. The BEACON model: BEACON (Bench-marking and Readiness Assessment for Concurrent Engineering in Construction) assesses the readiness of construction companies to improve their project delivery
    processes through the implementation of CE. It consists of four elements, which are Process, People, Project and Technology. A commercial software tool has been developed to automate the process of CE readiness assessment for construction organizations. The software takes the user through a series of questions and generates a diagram called the BEACON model diagram that graphically illustrates the assessment results.
  2. IQ Net Readiness Scorecard: This was developed by CISCO and is a Web-based application that assesses an organization’s ability to migrate to an Internet business model, which gauges the readiness of IT service providers. The application comprises of a series of statements that fall into four categories – Leadership,
    Governance, Technologies and Organizational Competencies. Similar to the BEACON model, companies are required to respond to the statements and on completion, they are presented with an IQ Net Readiness Profile.

The model that is described in this chapter combines aspects of these two models and builds on them. The proposed model adopts a similar methodology where the end-users are presented with a set of statements and an assessment of their e-readiness is based on their responses. On completion, the respondents are presented with a report which includes textual and graphical data. Where the proposed model differs from the two described above is that, while the BEACON model focuses on CE and the IQ Net Readiness Scorecard addresses the readiness of technology
companies (e.g. software companies, vendors and application service providers (ASPs) to develop applications and pro{it from what is termed the ‘e-conomy’, the proposed model assesses the e-readiness of construction
organizations to adopt e-business. The readiness assessment tool that is based on the proposed model is called VERDICT (an acronym for Verify End-user e-Readiness using a Diagnostic Tool).

Organizational Readiness for e-Business

With the growing importance of the Internet, companies across several industries, including construction, are increasingly leveraging the Internet to achieve competitive advantage.Internet-based tools such as project extra nets are being used to manage construction projects.
Such tools can be used to monitor control, manipulate and store project information and to make it available to all participants of the construction supply chain. Examples of Internet-based tools include a computer-mediated tendering system for services or contracts, purchasing of materials via the Internet by a contractor, project extra nets
for project management and specifying products online by a manufacturer. All these tools can be categorized under
the broader umbrella of e-business for construction as they support and/or facilitate business functions such as trading, exchange of data and information, and automation of the business processes and workflows.
Research studies and recent industry and research publications have documented the possible benefits
and business opportunities for companies using e-business tools such as project extra-nets. In spite of these documented benefits, the UK construction industry has been relatively slow in the uptake of these tools
in their day-to-day workings. A survey of the UK construction industry, undertaken by the Construction Products Association (CPA, 2000), predicted that by 2005,50% of the industry’s business activities would be
undertaken using e-business. However, another survey carried out a year later by the same organization indicated a considerable reduction in these projected figures to 22’/, (which is less than half of what was initially predicted),
indicative of a much slower uptake than anticipated. The construction industry stepping back from the initial’dot-com fever’ was seen as the main reason of this change (CPA, 2001).

Additionally some other factors that have also contributed to this slow uptake are:

  • Since e-business technology is relatively new there is limited availability of information or feedback on the technology’s performance on previous construction projects.
  • As with most technologies, it can be difficult to gauge the quantitative return on investment (ROI) from using new technologies such as e-business.
  • The teething problems and changes in working culture and practices which are required initially, with the adoption of any new technology, very often deters new users.

Although the uptake of e-business in the UK construction industry has been relatively slow, it can be seen that the construction industry has now realized the enormous potential for its use in the construction sector. The
UK construction sector is trying to maximize the use of e-business through several industry and government-backed initiatives [e.g. M4I (Movement for Innovation), CBPP (Construction Best Practice Programme), CPA (Construction Products Association), Construct-Il etc.l that promote research into the use of emerging technologies, such as e-business, in construction. Ii is now the industry’s view that, e-business is here for the long run and it will not be long before it becomes an industry standard.

Implementation of any new technology such as e-business for achieving business targets requires major changes in an organization, its current practices, systems, processes and workflows (ITCBP Intelligence, 2003).
The correct strategies and implementation plans have to be developed, communicated and implemented at all levels. Since this is not easy, issues such as ‘buy-in’, defining a strategy, selecting a system, developing a training programme, defining operating procedures, modifying organizational structures, reviewing use and extending use need to be thoroughly researched (ITCBP Intelligence, 2003). Taking this into account, construction companies who are currently using and those who have yet to use, e-business tools need to take measures to successfully adopt, use and
benefit from e-business.

It is important for companies that seek to adopt e-business to analyse their businesses to ensure a productive and beneficial implementation of these tools that is:

  • They need to evaluate the impact of using e-business tools on their day-to-day business processes
  • Assess their ‘e-readiness‘ for adopting e-business.

This page focuses on the development of an e-readiness assessment tool (VERDICT) for construction organizations. The next section defines e-readiness and describes the adopted methodology. This is followed by a review of readiness assessment models and detailed description of the development and implementation of the VERDICT tool. An example is used to illustrate the operation and features of the system and aspects of system evaluation are also presented.

Next Pages: