It’s taken nearly two years, but Aconex finally announced the launch of Connected Cost earlier this month, potentially heralding a move into construction payment management.
With its July 2015 acquisition of US-based Worksite, a project cost management solution developed at ARES Project Management LLC, the Melbourne, Australia-based construction collaboration vendor Aconex started working towards integration of project cost management into its core SaaS platform, filling a gap in its product portfolio compared to several competitors, particularly in its strategically important north American market. In a February 2016 financial update (post), Aconex CEO Leigh Jasper said: “We’re already starting to see benefits from the Worksite acquisition. We’ve won a number of deals because of it and some customers are looking for that cost functionality.” The rationale for the March 2016 acquisition of Anglo-German rival Conject also partly underlined this shift (the former BIW Technologies business had added project cost control functionality to its UK platform more than ten years earlier), and Aconex was then talking about the commercial launch of its connected cost module later in calendar year 2016.
This apparently happened in November 2016, but was presumably a ‘soft launch’. Just over a year after the Conject deal, Aconex finally announced its Connected Cost solution earlier this month (read 5 April news release), providing cloud-based cost control across the project lifecycle. According to Aconex, it addresses the problem of disconnected teams and data:
- Siloed information – teams must chase information across organisations and applications, which slows the discovery of issues that can drive up costs and delay schedules.
- Manual updates – typically made via spreadsheets, these introduce errors and duplication that can jeopardize both data integrity and version control.
- Poor visibility – lack of accurate, real-time information makes it impossible to measure performance against budget in a meaningful and proactive way for a single project, much less a portfolio of projects or an enterprise.
Guy Barlow, global commercial director, Connected Cost, at Aconex claims: “only about 5% of projects meet best-in-class predictability in terms of cost and schedule. Approximately 80% run over budget, and the average cost overrun is 70%.”
Aconex’s SaaS Connected Cost solution is said to address industry challenges with collaborative project controls that provide a complete view of cost information across both individual projects and project portfolios. Each organisation using the solution can budget, forecast, track progress and performance, manage entire programmes, manage contracts, and process claims and payments. For example, with earned value management (EVM) capabilities, owners can forecast and report earned value using Cost Performance Index (CPI), Schedule Performance Index (SPI) and other tools.
Aconex to move into CPM
According to an interview in the Australian Financial Review, Aconex is planning to expand into financial services by using operational data about subcontractors and their projects to help lenders price credit to them. Director and co-founder Rob Phillpot, right, says the business is also looking to develop a payments function on the back of Connected Cost product. This would see them competing with, among others, Textura (the leading player in the construction payment management (CPM) market in north America which also expanded into Europe from 2014, and was acquired by Oracle in April 2016 – post), Australian vendor ProgressClaim (post) and UK-based OpenECX (post).