The Benefits of BIM (Building Information Modeling) In Accurately Forecasting Costs—and More!
Building information modeling (BIM) has surged in the past several years and its benefits are one of the few things everyone involved in the CRE industry can come together on. It has become clear that, while keeping the potential risks in mind, the benefits of BIM for any CRE business are impossible to ignore! Let’s discuss why.
Construction is complicated—plain and simple. With so many moving parts involved in a project, especially in the commercial sector, the risk of errors and setbacks can cost CRE developers valuable time and money. Between architects, engineers, business leaders, contractors, workers, and vendors, and the level of project complexity, and the need for responsive scenario running - it's no wonder that building information modeling (BIM) has surged in the past several years. The benefits of BIM are one of the few things everyone involved in the CRE industry can come together on.
BIM is an intelligent software solution that keeps everyone associated with a project under the same technological umbrella, as a means of efficient organization. BIM weeds out costly errors in the modeling process and identifies necessary changes before your CRE project breaks ground. With this versatile information in hand, everyone involved with the project can work together to fix designs before it's too late.
The benefits of BIM are impossible to ignore. Let's dive into why you should consider leveraging BIM for your next CRE venture.
The Benefits of BIM Cost Estimation
It can take days or weeks, to get everyone involved with a new CRE development project on the same page. Among the many benefits of BIM is the system's ability to facilitate real-time collaboration between designers, architects, engineers, and other essential parties.
Leveraging BIM software, designers can create an intelligent computer rendering of the proposed structure. The design provides practical information accessible in real-time. It takes computer modeling to an entirely new level—far beyond drawing basic lines on a screen. For example, BIM software factors in metal stud framing and drywall among several other layers involved in building what sounds like a simple wall.
As the design changes or various scenarios are explored, BIM takes all the costs, scheduling changes, and measurements into consideration, updating them at the moment for everyone to see. For this reason, the benefits of BIM begin with accurate cost forecasting for your CRE development project. You'll immediately see when your designer's proposed model crosses over budget. Then, your team can collaborate on necessary changes to keep the structure safe and cost-effective.
Even post-construction, BIM software can supply building managers with valuable data like warranty and maintenance information. From beginning to end, BIM bridges the gaps between the life cycles of your CRE development project.
Improved Analysis and Reduced Rework
Imagine you're several months into a new CRE development project, and your primary contractor calls to inform you of costly problems with the current design. You've already laid much of the groundwork, so fixing the problem will be profit- and time-consuming. One of the primary benefits of BIM is the significant reduction of such rework.
Significant Risk Reduction
In any sector, the lower your risk, the better your results. The BIM benefits your project by mitigating risk during the tenderer/tender phase. The software lays out a clear path for CRE development projects, ensuring that your tenders are on the same page. Utilizing BIM during the tender phase provides them with a clear understanding of design intent.
BIM also minimizes unforeseen issues during construction, ultimately solidifying confidence in the project. During the design stage, BIM ensures the early identification of issues while significantly reducing unknowns.
Reduced Construction Time Leads to Greater ROI
By weeding out issues in the early stages of the project and maintaining a centralized hub of communication, BIM ultimately reduces timelines, leading to higher profits and positive ROI. For example, let's look at the Ara Institute of Canterbury’s Kahukura Block. Considered one of the greenest buildings in New Zealand, Kahukura leveraged BIM to develop a sound design cost plan in just 20 hours. Usually, for a design as complex as Kahukura, it could take weeks to establish the same plan without BIM. The Ara Institute recognized the benefits of BIM and how it could help achieve excellence across the entire project timeline.
Because of its ability to shorten timelines, reduce (or outright prevent) rework, and centralize information, BIM can significantly reduce the overall cost of a project. When developers can reduce costs without sacrificing safety, integrity, or vision, they'll see valuable ROI thanks to the many benefits of BIM.
Are There Risks to BIM?
While the benefits of BIM are challenging to argue, there are some associated risks that CRE developers should consider before investing in sophisticated software. For starters, the BIM is only as accurate as the data loaded into the system.
This leaves BIM susceptible to human error on the communication front. If someone inputs incorrect data, you'll end up with irrelevant results. Unfortunately, if you don't catch those mistakes, BIM can't provide an accurate analysis of your project. To mitigate such risk, CRE developers must take necessary precautions.
At its core, BIM tackles complex projects that are high-risk by nature. That said, BIM risk scales with overall project risk. Given all the intangibles associated with construction, the software can't create a completely risk-free project. Therefore, project managers must practice BIM risk management to recognize issues before becoming major problems. Any BIM risk management plan should tackle the following categories: technological, management, and financial risk.
These risks pertain to your CRE development project's technical implementation of BIM systems. It helps to consider your existing system's ability (or inability) to share data with your BIM system. Perform strategic audits of existing systems, and upgrade frequently to ensure you're using the most up-to-date equipment and software.
Problems typically arise when single software tools are developed to accomplish requirements from different disciplines. With several teams on the project using the same BIM software, compatibility issues may also surface, which can lead to data loss during the transfer and update process.
Implementing BIM systems into a company comes with certain management challenges. You may have a team accustomed to doing things a certain way—full of employees reluctant to adapt to new systems. You also must consider the training periods and associated costs tied to teaching employees how to use the software. CRE developers must partner with tenders with a deep understanding of BIM systems. This is especially important when it comes to more complex commercial projects.
Every business decision comes with some degree of financial risk. The same is true for implementing BIM software into your existing systems.
Before making investments, consider the overall cost of purchasing software, attending training seminars, and upskilling your current staff on the new system. Consult with a trusted financial partner to go over the underlying costs associated with implementing BIM software, and how these costs might affect your company.
How to Develop a BIM Strategy and Execute a Plan
BIM's primary goal is to provide new levels of cooperation, with enormous potential at every stage of the building process. CRE developers are likely to request particular aspects of BIM—elements that align with their overall needs and project budget. Still, developers must understand the nuances and drawbacks of formulating a successful BIM strategy. While the benefits of BIM are worth the effort, developing a comprehensive plan is the crucial first step.
Think of your BIM strategy as an organized blueprint. It should include everything to do with BIM throughout your organization. For that reason, BIM strategies differ between companies based on their goals, among other factors.
To form an actionable BIM strategy that fits your business, consider the following actions:
Evaluate Your Organization
Your BIM strategy begins with an internal and external evaluation of your entire organization. Begin by determining the internal status of the company, then examine its external position in the current market. Ideally, you're discovering where BIM can improve certain areas of your business. Perhaps some branches of your CRE development firm would reap the benefits of BIM more than others. You can save considerable capital by identifying in-need areas before making a company-wide investment.
Determine BIM-Related Objectives
Once you've completed your company assessment, you must determine how you'll use BIM to tackle your business goals. With these goals in mind, you'll better understand how BIM can achieve your plans, meeting meaningful milestones along the way. By breaking the overarching agenda into BIM-related objectives, you'll realize how the software can support your organization.
Implement BIM in Your Company
With a business assessment in hand and achievable goals mapped out, it's time to create a roadmap for integrating BIM into your company. This planning can help you avoid cost escalations, missed deadlines, and other expensive errors associated with overzealous implementation.
Once you've integrated BIM into your company, it's time to develop a BIM Execution Plan (BEP) detailing how every party involved in the project will tackle their various roles. BEPs are a crucial step in any construction project, especially those that are more complex and involve many collaborators. What sort of information should you include in your BEP to keep everyone on the same page?
First, determine how your collaborators will generate, manage, store, and share BIM files. This keeps everyone involved in the loop regarding file sharing, mitigating the risk of data loss during the project. You must also delegate roles and responsibilities within the BIM process. This should incorporate project execution plans and information delivery systems, discerning who's responsible for what and which protocols and procedures they'll follow.
To ensure your project moves as planned, create a strategy for key deliverables and a roadmap for project milestones. It also helps to create an annotation/abbreviation document explaining various shorthands that most likely litter your strategy. When referencing those shorthands, everyone is on the same page regarding their definitions.
See How BIM Software Benefits Your Next Project
In its early stages, BIM was utilized primarily by architects and engineers to create accurate digital renderings. Now, all collaborators can leverage BIM systems—especially CRE developers—to cut unnecessary costs and expedite project timelines. While keeping the potential risks in mind, the benefits of BIM for any CRE business are impossible to ignore! However, the financial investment in acquiring and launching the new system, as well as change management and training for staff and partners, exemplifies the need for a financial partner with deep CRE industry expertise like Minnesota Bank & Trust.
By implementing BIM, your CRE development projects can benefit from improved profitability, reduced costs, better time management, and improved customer-client relationships. If you're considering an investment in BIM software and training and want to fully explore the financial implications, contact Minnesota Bank & Trust to speak with a commercial banker today.