How Data Enhances Data Center Project’s Construction Workforce Efficiency

HUSSEIN CHOLKAMY: Hi, everybody. Thanks for joining our class today. My name is Hussein Cholkamy. I'm the co-founder and CEO at Eyrus. If you're not familiar with Eyrus, we are a workforce management platform. I started the company with my partner, Alex McManus, back in 2015, and we've been doing great since.

My background, just by way of introduction, I started my career as an architect on the West Coast, then I went to business school in the East Coast and changed my career into real estate development and construction management before I started Eyrus in 2015. With me here today is Steve Baret.

STEVE BARET: Hey, everyone. My name is Steve Baret. I am the head of Strategy and Partnership at Eyrus. My background is from the general contracting world. I used to work for Mortenson as an innovation manager from their data center group. I've been with Eyrus for a year and have implemented Eyrus on my job site. And I'm excited to talk to you about some solutions and experiences that I've had today.

HUSSEIN CHOLKAMY: Great. Thanks, Steve. Our topic today is how workforce data enhances a data center project's construction efficiency. We're going to talk-- I'm going to take you really quickly through the data center market, a little bit of the trends in the construction technology investment space.

And then we're going to dive into why focus on to the workforce and that single source of truth for the workforce information, and how it works, and then, of course, what results you get-- or what's the outcome when you utilize such systems to help with the efficiencies of your site.

Let's dive into the data center market. The data center market is a very large market globally, actually. There is a continuous global growth of data center demand, and it won't stop. Really, technology, everything, including this call, is on a data center somewhere. And it's processing through a data center somewhere.

And depending on where the people are listening to this forum-- if they're overseas somewhere, the data center could be overseas. Doesn't have to be in the US. This is how data centers work, and you guys are all familiar with that. And of course, the boom started happening even more since the pandemic because many of us and many of you have gone to working from home and have gone to utilizing video conferencing more frequently.

And everything goes through a data center. Data centers vary in sizes. They could be smaller data centers that fit within cities or fit within sites to fill a gap, or they could be large data center, what we call hyperscale data centers. We're going to focus on those only because there's so much to talk about, so I'm trying to just zoom in on the relevant topic.

But these data centers, if you look at the market overall, today, the market of data centers-- according to Data Bridge, which is a research company based out of Florida. They focus on investments and research in the data center space. Today, the market is at $30 billion a year in the data center space.

I know that sounds small because that doesn't include the guts of the data center. That's mainly the construction value of the data center. So that number does get larger if we include the guts of the data center. But the projection is, by 2029, that's going to triple. It's going to be at $93 billion globally.

That is a huge growth and a huge market, and it will continue to steadily grow globally. When we focus on the hyperscale data centers-- typically those are $1 billion buildings. They're large buildings. They're are hundreds of thousands square feet.

They're on a campus. There are multiple of them. They're typically by a single owner or multiple owners. That happens.

But there are about 300 of those data centers, of those hyperscale data centers, in the pipeline globally today as we speak. It is a big market. And because the demand is high, schedules are getting tighter. And for any of you guys that are building data centers out there, you know what I'm talking about. It's about the schedule. It's about getting it done fast so that it can be commissioned and operational and data can flow, because that's revenue.

At the same time, we want to look at the trends in construction technology, and that's been happening over the last 15 to 20 years but more so in the recent years. There was a study run by McKinsey recently that outlines or focuses on where those investments have been happening in technology.

A large percentage of the investment recently and over the last few years has been focused on construction and commissioning space. That is where a lot of technology investments are happening. And it's twice the investment activity than any other area in the construction space.

When we zoom in a little deeper to understand what part of the construction and commissioning has the most investment, you will see that according to McKinsey in that research that the highest investment are in the field productivity enhancement. Now, field productivity is not really understanding what a person is doing and how productive they are.

Field productivity is understanding what the person is there for and how long are they there for and what do you do with that data and how do you analyze it and how do you turn this data into something objective that you can make decisions with.

STEVE BARET: Thanks, Hussein. As the technology evolves, it really focuses on a key element of our projects in a key phase of the construction process. When we look at those technologies and when we look at where the investments are going in the construction phase, this is where most of the cost and most of the staff of our workforce are coming into play.

Most of our costs happen during the construction phase. And most of our labor come to the jobsite to get the work done during the construction phase, and this is a big part. This is one of the highest risks that we have during the construction industry because labor cost represents about 60% to 70% of the entire project cost.

And you know what? It's not about to get any cheaper. On year to year since last year, it has seen the biggest jump in the last 40 years, and the pay increase has gone up by 6.3%. It's essential to understand that looking at the workforce and looking at the demand, we can't fill those positions right now.

ABC has looked at-- has run a study in which they look at the demand versus the available workforce, and they found that we cannot fill the demand. AGC also ran their own study, and they found that there still 375,000 unfilled position, which is a big shift from last year. It's about 11% higher.

And the most important part is that most of the companies, construction firms that are looking for jobs, 93% of them are having open position. 91% of those companies, they can't fill this position. But yet, there is a 3.5% unemployment. It's essential data because people are not coming to the construction industry.

New people are coming, but it's very little. We have an aging workforce that compounds the problem. When you look at this graph, over 40% of our workforce is over 40 years old. We have the greatest average age of any industry in the country. When we look at the age of plumbers or electricians or overall construction workers, we're about over 40.

That means that people-- our workforce is getting older. The point that I want to make is Hussein talked about how much demand there is. There's a lot of it. But we can't fill the gap. But yet, our workforce is getting older. There's a study that was done that for every five retirees, there's only one younger worker to fill the gap.

That really shows the importance of trying to attract more people. And as very little people come in, young people come in-- we look at the age of the coding industry, and it's 28. So they have access to a lot of young people while the construction doesn't. What does that mean?

That means that there is a wave that's already here and that's coming even stronger that a lot of people with experience are retiring. And we've got to fill those positions, but we're not filling them. So we're going to have to talk about workforce data, how we can help gain insights into a workforce to gain efficiencies.

So we're talking about the importance of a single source of truth. And I'll hand that over to Hussein.

HUSSEIN CHOLKAMY: Well, with that said-- thanks, Steve. With that said, let's focus on a hyperscale data center as an example. And not for anything other than we're just trying to drive a point that there's a curve here. Something's going to happen where workforce is aging, we have shortage of workforce, we don't have new workforce coming in, and we have high demand on everything, not just data centers.

But why are hyperscale data centers important? Because they honestly need a large workforce to compete. So let's take, for example, one of hyper data centers-- of one of many that we see in our system. Typically, the sites are over-- are hundreds of acres large with multiple buildings on it, multiple hyper data centers. 5, 6, 10. It happens.

These are multiple $1 billion projects that are being added all across the site. The schedule is the major driving force because you want to finish it quick and you want to get it commissioned as fast as you can to keep up with the data demand. On average, these sites have a hundred people on them just to manage them. That's from the general contractor and the subs just to manage the people that are being deployed.

You have, every day, about 1,500 people that are coming to the site in and out-- a lot of moving parts-- totaling about 7,000 to 10,000 workers are coming to that site in the life cycle of a project. There's a lot of numbers, a lot of people to manage. You're recording, on average, about 4 million workforce hours per year.

There's about 40 to 45 different companies that are being managed on site. Get the picture? I mean, I'm not trying to build stress here other than to just build the idea that we are going to have a resource problem. There's not enough people to build. So what you have to do is you have to manage them more efficiently.

How do you manage a project with a schedule driving it and pushing it to happen? Because in reality, on these data centers, they come with a lot of penalties for delays. And everybody, everybody, pays the price, from the owner, to the general, to the sub if there is a day of delay.

Some cases, there's about a good million dollars that have to be lost somewhere between the owner and the subs and the GCs. So how do you manage all these moving parts? You need reliable data. You need to be able to make decisions quickly. And you need to be able to manage the people efficiently.

So we believe-- and this is what Eyrus is. We're a centralized workforce database. We believe in the power of having that database that actually has enough information about the workforce. Because since the workforce is the driving factor for the construction, and it's a high risk for your sites, at 60% to 70% as we said earlier, of the cost of your construction, it only behooves you-- it behooves us-- to manage them and know exactly what's happening.

But think about this. With a single source of truth, now I know everything about that person. That person, we don't need personal information. We just need to know their training, when they come, when they leave, who they work for, and what they are doing on site. When can they come on site?

And with having that information, you can control everything from the security of a site-- as access, control the safety. You can help with preventing potential incidents which can cause delays by restricting access to certain areas or having alerts with a person walking in a space they're not supposed to be in. That happens.

Hundreds of acres. Do you know where everybody is on that site? You don't. So you need data to help you. That data also you need is a lot of our projects require compliance reporting where the owner, the city, the county, you never know what the agreements are, but compliance reporting needs to happen on the fly.

And compliance doesn't have to be just in demographics, compliance is also in training. Some sites we have up in the state of New York require a certain OSHA training, or else you're not allowed on site, and that the GC can be fined up to $10,000-- starting at $10,000 for not having a real-time database of who is trained.

Well, where do you get that information? You get it in that real time data central database that we created. Well, guess who operates your equipment on site? That's your people. So can you control that? Can you manage who's going on what equipment? Can you stop them from going to an equipment where they could potentially get injured?

Of course you can. That's all by using that information. Can you manage your schedule based on the fact that 60% to 70% of your risk, which is the people, are actually the ones building? And guess what? You have a shortage of labor.

So you want to efficiently manage that 60% to 70% of your cost and make sure that you're introducing bench time. Make sure that you're managing-- all right, I needed 10 people yesterday. I need 10 people tomorrow to do the same task and to complete the task by the end of the week.

And that information is simple to push in any payroll if you want to make sure that the labor and the workforce is paid on time. You can have that information pushed, because now you have their time sheets, you have where they are on site, and then you can-- and then you can link that data to different databases.

And last but not least, since we have the time sheets for these workers and since the workers are the work-- the workforce is the one building-- well, if the workforce has access to being able to report progress of construction, guess what? You can have your daily report built automatically by the workforce without having somebody trying to put the pieces together at the end of the day. And how does it all work?

STEVE BARET: So how does it all work? Hussein touched on a great point. A centralized data force-- a centralized workforce database at our fingertip. It's super important. In my position, when I was at Mortenson, I needed to find solutions that fit our workflow, not the other way around.

I could not have a workflow adapt to a solution. So I needed something that was really, really seamless for our workflow and easy to use. Because if you're a superintendent, if you're a foreman in the field, you have less people to do the work. Your schedule is getting compressed. So you're under a lot of stress.

So we have to find solutions that are easy to use. It really will minimize any data entry. Let me suggest that if we find a solution that adds clicks, that adds steps to a person or to a workforce, I'd say we failed our workforce, because we want to make their life easier. And we want also people on the administrative site to access the data a lot more efficiently.

They don't have to look at-- for the data. The data comes to them instead of them going to the data. But most important, I want to trust my data. I want to know that it is reliable and consistent. If I'm a general contractor and I have different job sites across the country, I want to have a consistent database so I can really have insights into my workforce.

This is the same thing for a trade partner or for an owner. That consistency is key. And different stakeholders, they want to configure their-- configure their reporting differently. It's the same set of data, but we want to configure them in a certain way for our needs.

So after that conflagration, I need to automate that data. I can't afford to go look for the data. I need that data to come to me and to be accessible. There is also an essential part of that workforce management data that could come to you. We don't have the time to go and investigate the data. We have to automate those reports.

But also, if there's a deviation, I need to have an alert that tells me, hey, you have a problem here, and it tells me where the problem is instead of me going to try to find the problem. So in addition to that, I need to understand if my data is objective. So if the data is objective, I know these are facts, and they're database driven.

They're not an opinion or perspective of read another paper or anything else. I need data, and I need it fast. So how do we-- that leads us how we're going to get that subjective data. Well, if we want to look at acquiring data and understanding workforce efficiency and help our workforce, we first have to understand who's on our job site.

How's our job site? Is it a greenfield? Do I need a passive system? Or is it something [? that's ?] [INAUDIBLE], that have access control in which I have a card that would unlock doors or would unlock turnstiles? Who do I need to be a little more granular? Do I need to understand who is in which building?

Because we could use that data for safety. We could use for safety, hey, do I have too many people in that area that it really affects my productivity? Or can I send an alert to all the workforce in one of the buildings, letting them know, hey, you know what? We're going to have a fire alarm testing. This is just a test. This is not an emergency.

Or could we use that data for project controls, understanding who's in which building for billing purposes, because sometimes different buildings have different cost codes. So understanding who's in which building, we can assign the hours into different projects. Or do I want to be more granular?

Do I need to understand in the building-- where my workforce is in the buildings? We could use this info for safety and allowing access to very specific areas. I'll give us an example. Hey, do I need to have only my electricians enter that live electrical room and not anybody else that's not certified? So having a certification-based access control.

Or do I need also to understand who's in which part of the building? We're in a data center world. The things that we're building are very repetitive from buildings to buildings. Maybe we want to understand how long it took us to build an area. So we have historical data. So for scheduling purposes, for the next building, we actually know how much time we spent building that area.

Then now that we've defined it, we can choose the technologies that we want. If, I mentioned earlier, is my site fenced? Is my site not fenced?

As a general contractor, I really want it to have the opportunity to choose for various options, because if I have my site unfenced, I need it to understand I needed a passive system to understand who was on my jobsite, and that could have been achieved through BLE beacons, Bluetooth beacons.

And then moving towards the progression of the site in which then my site was going to be fenced, and I needed access control, then I could use the NFC cards in which I would have to tap on badge pads to unlock the turnstile. But also if you're a remote site, if you're a smaller jobsite, can we have the ability to have an application?

So people can have badges virtually. So Looking at the life cycle of the jobsite and understanding what technologies we need to efficiently capture the data, the workforce data, to gain insight is vital. But then we get to the bottleneck, into, hey, we need to have the people in the system. And providing the ability to actually register the workforce prior to come on the jobsite.

This could be used for in-app or scan a QR code. So we can increase our efficiency when people first come on site. But there's other benefits just like the workforce transparency. People now have-- understand what data are we gathering for workforce data. They can look at their own profile. They can upload their own certification.

And look at their time sheet. So they understand what elements is vital for us to look at the workforce data and bring really an early adoption for different projects. And then I move on to-- we're talking about the centralized workforce, right? And if I keep going now, my workforce is registered. I know how I'm going to capture the data.

What's important right now is looking at visualizing the data. And if I visualize the data, this is essentially a great communication tool. Because Hussein just mentioned this. Schedules are getting tighter. We're building more and more data center. Schedules is a major factor in how we built.

This is not about budget, but how fast we can build. And we're getting a workforce that's getting older, and we're getting less of it, and it's getting more expensive. So we're really gaining insights and communicating that insight into the workforce is very essential, and we need reliable data and a reliable source of truth.

Visualizing the data, most of us in the construction industry, are visual learners. So what better ways to look at it and dissect the data visually? Then we can start making better informed decisions. and we can make it quicker because now we have all the data, and we dissect it in very different ways.

So every stakeholder has the right information. All the data is there. It's all about how do you want to understand it. And then from there, it's creating those visual reports. So people on the jobsite can understand and can communicate quickly. And there's various other things that we could do.

So imagine, now that we understand people who is on our job site, we can compare, hey, I want to understand if my workforce what I needed to be today. Meaning, hey, I was supposed to have that many workers today, I only have that many. These are leading indicators that we might have some schedule slippage of this [INAUDIBLE].

And we can get that data. We can compare workforce actuals versus forecast. But also, how do you communicate? If I understand people who is on site right now, then I can communicate efficiently with them.

One of the major, major benefit is tracking safety certifications, understanding who's on our job site if they're accurately and sufficiently trained for our jobsite, and providing data of who is trained who needs training and who has access to what according to their certification and who can start which equipment according to their certification is vital.

Because we have a shortage of a workforce. A lot of our workforce that's coming in has very little experience. And our experienced workforce is getting older, is about probably to retire soon.

So understanding who is certified and what is essential, because then we can create compliance reporting. We can understand who is trained in what, and we can get what we can understand what training they have and who has to receive what training. So it's very essential because, now that we have that data, then we can start branching out to different, other platforms.

HUSSEIN CHOLKAMY: It's data, data, data. It's all about data. The buck doesn't stop at Eyrus. I'd love to believe that it does, but it doesn't. Our data is vital for our clients' management in multiple different platforms. So we work very hard in pushing that data as much as we can for our clients' purposes.

Either they, want it for scheduling. We can push into their scheduled programs, we can push into BIM and visualization, payroll if needed, as well as project management software. All of that is basically a way to document the progress of construction and understand where things are.

The goal is to minimize overall browser fatigue. Because if you have multiple software managing your workforce, you may miss something. And if you do, it's very important-- if you have multiple software-- it's very important to make sure that all the softwares are talking to one another.

That's why we believe in having one central workforce database. Anything that has to do with the workforce sits in one database, then we can send it where you want it to go. And we're happy to work with our clients. And that helps a lot. And we've seen the benefit of pushing data into multiple different platforms so that our clients can operate and visualize the data the way they want to visualize and operate the data.

But you need that for the efficiency of the site, especially with the fact that you may be strapped in not having enough people to build your building. So you have to understand who's coming and when. We also predict who should come. That helps you streamline decision-making.

Some [INAUDIBLE] we've seen with utilizing a data for managing a site, as we mentioned before, is a good 10 to 15 hours a week. Saved in admin work. That's a lot. That's one person a month, freeing up their time overall, to do something else. Either you may not want them on that project, you put them on a different project since you are short staffed as well.

Or you want them to do something else within the project. So now it enables you, as a general contractor, to manage your site more efficiently. We've seen that systems that are with a centralized workforce database and with the information readily available in real time have saved one to two hours a day for your trade partner management and operation, your superintendent.

They're the ones that have to know that information at all times. You put it to them at their fingertips then they know how to make decisions instead of making all the calls, which we all know happen. How many people did you have on site today, Joe?

Hey, John. How many people did you have? Oh, there were 25? I don't know, man. I saw 23. Well, actually, the system saw 20.

Without having these discussions, the superintendent can get into knowing what to do with the data they have. Overall, by knowing who's on site and understanding when the right person needs to be at the right place, you end up saving a good 5% reduction in a scheduled delay risk.

Suppose that that's true in a five-day reduction on a project that gets built, 5% reduction gets built in 12 months or 24 months. You can do the math. And we were talking about-- every day, delay was about $1,000,000 in losses in a hyper data center. You can do the math very quickly in why it's important to have that data to manage your project.

We'll zoom in on one specific project we've had. That's a project we've done in the Midwest. It's confidential information, unfortunately, as all those data centers typically are confidential location and confidential information, as you all know if you're in that space. But this one was built in Tornado Alley, which is in the Midwest.

Well, that's high risk for your labor. You have about 1,000 people coming into the site on a daily basis. You're recording 600,000 hours on the fly as you go. And you have to figure out in this very large site where people are in case there's a tornado. So you do need that accurate real-time attendance.

Yeah, you will say there's a siren. Yeah. Great. There's a siren. They're going to run to a shelter. Also great.

But do you know that they made it there? Do you know that everybody has evacuated? That's where the data comes in-- to help you with that. It's to make sure everybody's safe.

So as a result on this project, we had three full tornado safe evacuation. Not a person left behind. Everybody either in shelter or out of the site or in your location to be safe. The system could do it in real time for our clients and their safety engineers. So there's less stress and less headache.

And also if there's somebody who's not able to make it to safety, you know where they are. So you can go to them and help them out or communicate with them. That's a huge ROI for your workforce. You build that safety, you build that trust, and that's what you need for the commitment coming from the workforce.

In that project, we've saved, again-- as you heard earlier-- 15 hours a week in administrative time. You can only imagine how beneficial that was for the project. Did about 20% productivity increase in superintendent time. That's in the coordination. You don't need data coordination. It's there. You can make decisions.

And in that case on that project, we've successfully helped reduce the bench time by 3%. Now, with a shrinking workforce, you don't want them sitting, because you did not communicate to them on time to say, hey, there's a snowstorm today. Come two hours later. It's just a simple communication.

Don't come to the site tomorrow morning because there's a storm. We're going to start two hours late. If you can do that on the fly with a central workforce database, you can communicate that quickly. Because you know who was on site yesterday, and you know who's coming tomorrow. So you can communicate with them.

Very simple. Simple, simple things that can make a big difference for you on your project. Anyway, I can go on and on about success stories about having a centralized workforce database and having the data in real time and on the fingertip. And we will continue to see that success and a way to build projects more efficiently with reduced workforce pool out there.

Thank you all for listening to us. Again, this is Hussein Cholkamy with Eyrus. And with me was Steve Baret, also with Eyrus. Our emails are here. hussein@eyrus.com, steve@eyrus.com. You can reach us at any time for questions. I hope this was an informative session for you guys. And we'd look forward to hearing from you with some questions to either of us. Thank you so much for your time.