CONSTRUCTION Accounting ARTICLE -
Are You Ready for 5D Modeling?
High-tech Estimating Software Looks Promising

Target Audience: Construction Industry Professionals, Accounting Consulting Interest, High-tech Professionals, Construction Industry, Project Managers, Estimators, Software Innovations Interest

Margins are typically razor thin in the construction industry, and it’s important that your estimators and project managers have every possible advantage. The newest generation of design technology, 5D, may be the advantage they — and you — need to keep your jobs in the black. Let’s take a closer look at this promising new kind of software.

The Evolution of 5D

Model-based, or virtual, designs have been common for more than a decade. Such software started with 3D virtual models. With these programs, you can spot potential problems before going on site — a significant advantage in itself — as well as review and verify the overall construction process based on actual building elements.

Design changes are faster and easier with 3D models, too, because the virtual programs recognize how elements relate to each other. If a change will cause a problem somewhere else, 3D models will demonstrate the conflict.

The next generation of virtual modeling to come along was the 4D system, which displays construction progress over time. These products visualize the process but don’t allow you to ask questions about it or relate construction stages to components.
Recognizing these deficiencies, programmers set out to address them. The result? 5D modeling.

The Latest and Greatest

5D software visually links design, cost and schedule considerations into sets of construction tasks. Each set, or recipe, contains information on the equipment, labor and materials required for each job task along with current cost data. If the program can’t find a recipe for a certain task, it flags that task for attention.

When the information is complete, the 5D system determines project costs — including tax, risk and margins. You can make adjustments to address changes (such as an increase in the cost of concrete) and add costs that aren’t included in the model (administrative costs or general overhead, for instance).

Then the information goes to the scheduling application, where the system determines each job task’s likely duration. Every calculation the program makes is linked to cost and design as well as time.

Thus, you know immediately what effect every change will have. 5D systems show you not only how a change affects other sections of the project, but also what it will do to cost and scheduling.

When all is said and done, 5D modeling program results allow you to generate estimates, plan projects, catch errors, determine how long each step of a project will take and develop more accurate cost projections earlier in the process.

Baby Steps

Of course, 5D systems are still in their infancy and aren’t perfect. For one thing, there aren’t that many of them available yet.

As of this writing, the undisputed leader in the field is Vico Software. It offers a suite of products that includes applications to compress schedules and make unified project presentations as well as modeling, estimating and managing projects.

And therein lies another problem: The offerings aren’t fully integrated, which means you must spend more time installing and using them. Plus, there’s no guarantee the software will be compatible with your existing systems.

Because of the many different applications that can be bundled into a given package, pinpointing a price range for a system is difficult. But you should probably expect to pay anywhere from $4,000 to $12,000. Discuss any potential purchase with your financial advisor and, perhaps, a technology consultant.

When the Time is Right

Many contractors who have used 5D software say it has saved them significant amounts of money by reducing waste and improving estimating and scheduling. Yet it seems safe to say that 5D has yet to realize its full potential. This may not be the time to jump in, but it costs nothing to investigate — and you’ll be ready when the time is right.

Find out how our expertise in construction accounting can add value to your business. Email us or call us at 1 (888) 875-9770.

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