Small and Medium Firms Going For Extranets
Sept. 18, 2000 — Extranets have been appearing on the design and construction scene rapidly since their introduction as an industry about three years ago.
Early extranet services were costly and appealed to large architectural and design firms that had the luxury of big budgets and were more likely to try the latest technology. It was not unusual for those services to cost $1,000 to $1,500 a month for each project. To justify that outlay, companies felt they needed projects that had at least $10 million in construction value.
Times are changing — and fast. "Today, with the advent of so many free services, I believe it has become much more feasible for smaller projects to now be practically managed with extranets," says Jerry Laiserin, FAIA, a Woodbury, N.Y.-based architect and technology consultant and contributing editor to Architectural Record magazine.
One of the most successful of the service providers is San Francisco-based Buzzsaw.com Inc., a startup backed in part by the key industry player Autodesk and by Crosspoint Ventures. It features ProjectPoint, a collaborative Web-site service that hosts projects of up to 100 megabytes of data at no cost to the client.
Orr notes the possible downside. "Of course, customers have little or no claim to high-quality service if there is no charge to begin with," says Orr. "And the free, 100-megabyte space can be eaten up quickly with a large project. That's when additional space may be needed, bringing fees up to a level comparable with some of the other less expensive extranet service providers," says Orr. Customers who exceed the free 100 megabytes are offered a $200 monthly service for up to 1 gigabyte of content, or as much as 5 gigs for $500 a month.
A Small Firm Takes a Big Step
"The learning curve is directly proportional with the number of collaborative partners involved," says Terrell.
"Our objective is to ultimately build buildings without any paper," he says. "We hope to improve the quality of our architectural drawings by giving team members access to information in real time. We anticipate giving added validity to our design documents in relationship to our clients' desires through a streamlined communication path from the designer's mind to the eye of the owner, with immediate feedback. I'm hoping the extranet will eliminate all of the paper, reproduction and interpretation trails that are traditional to the communication process between owner and architect," adds Terrell.
Terrell has had no problem staying within the 100-megabyte limit the free service provides, noting, "If I'm not sloppy, I don't think I will have any problems staying within the parameters of the space available."
Terrell briefly scanned the free Web-based extranet market but quickly selected Buzzsaw for his 4-year-old firm, solely based on its tie to Autodesk. Terrell has confidence in the track record of Autodesk, and his firm has greatly benefited from Autodesk's CAD software. "They seem to have the momentum, energy and backing to make their extranet work right," says Terrell.
The architectural firm has a pre-existing T-1 network line to all of our workstations, which is key to the Buzzsaw identity process, Terrell says. "So we didn't have to buy any new hardware, but I do anticipate eventually purchasing a high-broadband Internet access for our numerous team members' home-office locations," he explains
As the number of collaborative partners each project generates grows, training will be important — and some may resist the new technology. "I think it's the responsibility of both the architect and the service provider to convince project partners to embrace the concept," Terrell says. "But the service provider needs to produce traditional brochures that will help educate the more pragmatic, less tech-savvy members of a project who permeate the construction industry. It can be a tough sell."
Terrell says special staffing for extranets should not be required, and the new systems should be more intuitive and user-friendly for nontechnical employees.
Orr has identified 113 extranet service companies, with more jumping into the fray on nearly a daily basis. "The whole business of giving away things for free on the Internet in order to capture eyeballs is still not a tremendously well-understood business model," he says. "It seems to work in some cases, but not in all."
Many small to medium-sized design firms have considered using an extranet, but some are cautiously waiting for the right project to come along for a trial run, says Laiserin. Others are embracing it.
Santa Monica, Calif.-based Summit Architects Inc., a 26-person architectural firm, decided to jump into the new technology with both feet. The project management, architectural and interior design firm, established in 1986, began to shop for either a software package or service provider for project-management Web-site services about three years ago, says Steve Davis, AIA, VP and founding principal for project management at Summit Architects.
A Major Campus Expansion
Summit relied on vendor interviews and information from service providers and their clients when shopping for an extranet. The company considered a number of options, including an off-the-shelf software package and a company that was strong in its online drawing management. Ultimately, the firm chose San Francisco-based Bidcom for its focus on construction management, a very critical component in the university project, according to Davis.
Newport Beach, Calif.-based Swinerton & Walberg Co., the project's general contractor, is absorbing the cost of Bidcom's inSite extranet service. InSite enables the owners, architects, general contractors, subcontractors and suppliers to communicate and coordinate their work from any location using an Internet connection and a Web browser.
Requests for Information, or RFI, schedules, submittals, tracking of permits, meeting minutes and billings are handled in real time over Bidcom's multilayered secure Web site, which reduces delays and saves such costs as faxes and couriers. Information developed off-line, such as plans and specs, project manuals, forms, schedules, daily diaries and records of conversation, are stored on a central server.
"Given the youth of the extranet-services industry, the competition of service providers and the prominence of our project, Bidcom was willing to negotiate our enrollment and monthly fees," says Davis. "But we would have taken the service, regardless of cost."
The learning curve was significant, since a number of Summit's collaborative consultants were not yet Web-knowledgeable, says Davis. "But the system is very intuitive and easy to learn, and our younger, more computer-literate staff easily absorbed the extranet responsibilities in the performance of their existing duties."
"It hasn't been problem-free," says Davis. "Some things didn't work as well as we hoped, and there have been glitches in the system attributable to the use of the technology in general. Users have occasionally entered improper commands to the system and were not adequately warned that their input was not processed," he says. "Reliability, access to the project Web-site server and technical workflow-processing problems also have caused some concern within the project team, but Bidcom has been very responsive in resolving any problems we experienced," Davis says.
Davis attributes some of the challenges to being a "pioneer in the use of a system that will soon become as natural to the design and construction industry as pen and paper were 30 years ago," The extranet hasn't changed how Summit does business, but the firm is doing it more collaboratively and with better dialogue among team members. "It has certainly provided us with more real time for decision-making. It's what we expected and it's what we got," says Davis.
Many extranet-service providers operate on the assumption that most architects do not have, or desire to have, the computer resources necessary to host collaborative Web sites. Project Center, from the Belgian firm BricsNet, and eProject Express, from Seattle-based eProject.com Inc., are two examples. They provide a central server on the Web, renting project space on a pay-as-you-go monthly basis. The only requirement for the architect is to have a Web browser.
BricsNet, which offers ProjectCenter, hopes to develop into more than simply a project-collaboration service, says Orr. The company charges a set price per project, regardless of the number of participating collaborative partners. The company also offers 2-D/3-D modeling and analysis software; it also plans to provide building product information and purchasing services to contractors.
Currently, the hottest "high-end" services primarily are operating from California, claims Laiserin. Bidcom and Palo Alto, Calif.-based Cephren Inc. have joined Buzzsaw as the recognized leaders in the extranet industry, he says.
Aside from technology, an infusion of venture capital has helped to ensure their claim as the "Extranet Big Three." "They had the money to support costly marketing programs and achieve critical, high visibility through trade-show exposure," says Laiserin.
Some Tips for Choosing Among the Options
Rather than getting too excited about all the bells and whistles available, Orr advises firms considering extranet services to carefully analyze the degree to which they must share project documents and the frequency at which changes are typically made to project plans. Small and medium-sized firms also should consider their needs to communicate revision changes, their level of responsibilities concerning Requests for Information and the market in which they are competing, he says.
Communication is critical between design-team partners and miscommunication is always a threat, says Orr. "In a team of 100 collaborators — which is not very large for most architectural projects — there are 4,950 individual communication paths available. It doesn't take a statistician to realize the chances of miscommunication occurring in such a project," he says. "But an extranet-management system in this scenario reduces the number of communication paths to 100 and provides an audit trail, helping to reduce costly errors and potential litigation."
Most extranet services notify each project collaborator when plan revisions occur and RFIs are managed to speed and track communication between team members. This echnology can amount to significant savings on large projects, says Laiserin.
But not everyone is in the loop, according to Orr. Many smaller collaborative firms, such as painting subcontractors and plumbers, still tend to view the extranet services as a time-consuming luxury that takes them off the job, he says. However, e-messaging wireless phones will soon help alleviate the remaining communications gaps among project partners
And — in a world where new developments change the terrain daily and weekly — Orr claims the best of the extranet services has yet to make an appearance. "All of the products are improving in their capabilities, and they all emulate one another very quickly," he notes.
Initially, extranet software was bought by architects to run on their in-house servers, or service-based packages they could purchase, he says. Now all of the collaborative software companies have found a way to offer their products as application services providers, or ASPs, and all of the service providers have responded by offering their software for sale. So even basic product differentiation has become clouded, making it difficult to track performance, says Orr.
Another difficulty in identifying the success of extranet firms is that almost all vendors are privately held, venture-funded companies, with unsubstantiated user statistics, explains Orr. "No accurate industry data is yet available," he says.
Extranets now allow small to medium-sized architectural firms to undertake much larger projects, further afield, according to Laiserin. "But," he notes, "the fact remains that so far, most extranet payoffs come to large architectural firms working on big projects, with adequate project monitoring staff."
Both industry analysts foresee extranets, like other online enterprises, soon consolidating with the marketplace defining the industry's future.
"Some architects feel they must have a competitive advantage due to their use of collaborative extranet software," says Laiserin. "Within a couple of years, most all architects will have to learn how to deal with extranets, as they'll be as common to the industry as fax machines. Those who don't may be viewed as lagging in professionalism."