Data strategy for manufacturers – A CEO’s advice
Manufacturers are the sole owners of data related to the products they fabricate. In the world of constant innovation, data brings with it great power but also great risks. That is why today we see many manufacturers striving to build their data strategy by understanding how to truly own their data, how to manage it and use it to fully leverage its value. After all, data is an asset they have already had for years but is now becoming a crucial differentiator for their business.
The construction industry has undergone major changes caused by the introduction of new laws and regulations related to global trade, product innovations, technology and improved processes. These changes have affected construction product and component manufacturers as well. Today, they are in the unique position to use data as means to create a powerful change themselves – a change that will bring benefits not only to their business but also to our society as a whole.
We are yet to see the major disruptors in the construction manufacturing business, the new ‘Uber’ and the construction industry ‘Amazon’. Forward-thinking manufacturers have realised the emergence of a new market for their products’ ‘digital twins’ and the first success factor they have turned to is the proper management of their data assets through a consistent data strategy. To support them with this challenge, Lars Chr. Fredenlund, CEO of Cobuilder AS, gives some valuable advice to construction products manufacturers.
‘I work with major European manufacturers and industry associations in many segments of our industry and overall, the focus is on creating a firm basis for the emerging digital business models through standardisation. It is my firm belief that only standard-based data management processes will actually allow for new revenue flows to enter the industry. In this context, an important point to make is that manufacturers and distributors must think in terms of collaboration with all construction industry actors and the international market. When talking about standards for digital construction, building a common understanding between actors, organisations and countries is paramount.’ – says Fredenlund.
Own thy data
Today, major market and political struggles in Europe take place between wholesalers, producers and other players. They argue who should ‘own’ what data. Data becomes a power factor with a strategic value. Here manufacturers have a unique opportunity to establish themselves as a key player.
The construction industry will increasingly rely on consistent product (systems and components) data. Therefore, it is crucial that the individual manufacturers take responsibility for their own data. Today, internal systems are used for meeting economic needs (ERP), customer support needs (CRM), marketing needs (PIM, WEB) etc. Yet, the majority of important product data is shared with clients via unstructured digital formats (word, pfd, xls) or, in some cases, third-party providers (product databases). For the users of these product data, this can lead to many inconsistencies, data loss, versioning problems and general poor quality of the data. For the manufacturers, this means managing numerous database duplicates, incurring huge operational inefficiencies and missed economic opportunities. Such implications exemplify the need for setting up a digital strategy that looks at both internal and external data and the connection between the two in order to create a consistent data architecture optimised for both internal and external users.
There are further complications when the manufacturer’s digital strategy does not support the data needs of the different data users. A good understanding of the product life cycle is paramount here. Data about construction products are used by end-users, architects, advisors, craftsmen, contractors, authorities, wholesalers, facility managers etc. These different users all need different data. As shown in Figure 1, there is a need for a strategy that allows manufacturers to provide the right data at the right time, depending on the type of data that has to be managed.
‘As I see it, manufacturers must supply data to many systems and tools in the future. All of these need different data. In Norway, the discussion has lately been more misleading than informative. Single actors are developing digital frameworks and even formats that they want to establish as a standard. I think this will create bottlenecks for the global construction industry. This work has to be aligned between national and international standardisation bodies in order to ensure that the global industry will benefit from a common best practice applicable to all actors.’ – further explains Lars.
The upcoming BIM standard ISO 19650 Organization of information about construction works – Information management using building information modelling parts 1 and 2 describes how and when players should exchange information. It provides a clear division between geometry /objects (3D), information (data) and documents. It looks at the information requirements at all the stages of a building’s life cycle and the benefits of a systematic approach to data management. It is just what the doctor ordered for the construction industry.
Standard-based data strategy
Understanding such standards and how to build a data strategy around it will create a competitive advantage for manufacturers. Grasping the digital strategy is a managerial task that will be put on the agenda in all companies. Contact your most important actors in the industry and start discussing.
‘To succeed in this area, look onwards and upwards, take responsibility for the company’s best interest and look beyond your own national borders when strategy is to be discussed. Make sure you also know what industry associations have achieved in this area. They have a special responsibility to represent your business in front of standardization bodies in order to ensure fair competition and an open market’ – advises Fredenlund.
New Standard for Product Data Templates
The European standardization organization CEN is now in the process of delivering a standard for digitising products’ DNA. In this way, manufacturers will be supported in their venture to provide machine-readable data that can be understood regardless of the type of IT systems and across different construction roles.
An important part of this work was to first look at the existing construction product-related standards in all EU member states. The CEN TC 442 workgroups collaborate with national bodies and industry representatives to create data sets which, among other things, define product characteristics needed for setting functional requirements for construction work. These data sets are then used to define Product Data Templates for all types of products. The standardisation of this process will allow for structured data sharing and open up possibilities for manufacturers to create a consistent internal data strategy in alignment with process standards such as ISO19650.
‘Cobuilder has done pioneering work in this field and created Product Data Templates based on the upcoming CEN standards. Today there are parallel races across Europe where actors define their own ‘standards’ and we see the same happening here in Norway. We should all work together with national standardisation bodies and international ones such as buildingSMART International and its national chapters, CEN, ISO in order to move the industry forward. This is probably the most important collaboration in the history of digitally-enabled construction and it is happening now.’ – explains Lars.
Furthermore, in Europe, builders and contractors are starting to agree on the use of IFC as a common data format and a number of software actors are developing the right IT tools for the job. The IFC and GS1 standards will be the data format at the forefront of all digital/data strategies in the construction sector. Manufacturers must understand how their products can be linked to their systems that in turn can be linked to information models (BIM). Machine-readable data is one of the main points, so that all actors can search for the right products or get the information they want.
The future of construction product data
It is important to learn from other industries about the benefits of digitisation. Today you can easily find where to book a hotel or a flight online, you can also compare providers (manufacturers) and make an informed decision of what to buy. There is no single ‘product database’, but common ‘data structure’ that helps the users over the internet.
‘I think that the industry in Norway has not grasped a major point about digitisation and it is that we cannot have ‘one universal system’. We should rely on open data structures in order to collaborate and enable manufacturers to compete on the right terms. Just like in the hospitality industry – a single product database does not exist. What we have is a number of players using common datasets that help us to do what we want to do using their data. We in Cobuilder work to help manufacturers to get to the point where their data is of the best quality for their clients and brings value to their business.’