How to Avoid Digital Transformation Failure – Lessons from AJ Waters

Rishi Srivastava (00:01)
Hello, everyone. Welcome to Finance at the Job site. I’m your host Rishi Srivastava from Being Human. Today, our guest is AJ Watters from Kahua. Welcome, AJ.

AJ Waters (00:17)
Hello, thank you.

Rishi Srivastava (00:18)
Again, I go through an interview. First section here is on your background and career journey. You started in construction, estimating and engineering at Cuit, then grew into leadership roles at Innate and Kahua. How has that career path shaped your perspective on construction technology adoption?

AJ Waters (00:40)
You know, that’s an interesting question because one of the fun things about my role is that the second day that I showed up as a new hire at Kiwit, I was handed a software that they had never used and it was called Onscreen Takeoff. we had one license, they were like, hey, you’re the new kid, you’re kind of tech savvy, test this out and let us know if it’s worth anything. And I looked at my digitizer.

that was sitting next to my desk and I colored up a PDF on on-screen takeoff and like during my internships I had colored drawings with colored pencils, right? Like that’s how I did takeoff. And I immediately caught on to, wow, this is a lot faster. I can do twice as much in half the time. so even from the like…

Rishi Srivastava (01:14)
Mm-hmm.

AJ Waters (01:25)
Day two, from day two, I was involved in technology and trying to understand how it can improve processes and how it can streamline workflows. so that, I think that more than anything is what started me off on this odd but fun journey. And so when Kiwet announced that they were gonna overhaul their entire company systems as part of a major digital transformation effort,

I volunteered for that role. And I was probably one of the few operations people that raised their hand and said, hey, I volunteer as tribute, bring me in. I want to do that. Because many of the people, you know, wanted to stay at the work, wanted to stay on the project. And so I kind of saw where technology’s value was headed. And that was why I volunteered and jumped right in.

Rishi Srivastava (01:57)
Mm-hmm.

Yeah, digital transformation. That’s a big deal in construction.

So next question is, from estimating engineer to chief evangelist, you won many hats. Which role most influenced how you now advise construction leaders on digital transformation?

AJ Waters (02:29)
So there’s two of them actually. The first one being leading the training at Kiwit when we ran through the rollout and just understanding with each iteration of the training and every new lesson that we learned, we started to work through challenges and struggles and each

Each phase that we rolled out, we got a little bit better, right? So there was a lesson learned, a lot of lessons learned in each individual phase as we moved forward. And we did a lot of things wrong. And that’s why we learned. And then the same thing kind of happened again when I went to Google as a program manager, my role there leading their construction technology selection and rollout.

We had different but similar challenges and we ran into different but somewhat similar obstacles. And so we had to learn some of those lessons over again. We learned some new lessons. And so both of those roles and kind of the things that we did wrong are what I tend to take into digital transformations now so that we don’t have to do those things wrong again. Right.

Rishi Srivastava (03:45)
Yeah, mean mistakes are one big way to learn from.

AJ Waters (03:49)
Exactly, yeah.

Rishi Srivastava (03:51)
You’re also the voice behind the NG nerd life. How has blending humor and creativity helped you communicate complex contact topics to the industry?

AJ Waters (04:04)
So one of the things that I always joke with people about, know, I came up as an engineer. I didn’t read a lot. I didn’t like to read. I waited for the movie to come out. Didn’t want to read the book. I majored in math, so I didn’t have to read, write like those sorts of things. So I don’t have the largest vocabulary in the world. And that’s helped a lot in being relatable and in, you know, simplifying what

Rishi Srivastava (04:15)
Mm.

AJ Waters (04:30)
could often be considered tech or marketing speak, right? So I used to joke often that some marketing groups feel like they’re paid by the syllable. And so the bigger the word, the fancier they sound. And really, it’s the opposite. Let’s make this as simple as possible so that the person on the other end of the communication understands it and it’s base level. We don’t have to go Google words just to

to know what you’re saying, right? And so luckily I come to the table just with that lower vocabulary by default because I didn’t enjoy reading and I didn’t like try to do that expansion. And that’s helped me a lot in the long run.

Rishi Srivastava (05:04)
Mm-hmm.

Yeah, you know, sounding smart is not as being smart.

AJ Waters (05:18)
Right, exactly. Yeah, if you can’t communicate your idea, then nobody knows if it’s good or not.

Rishi Srivastava (05:26)
Mm-hmm.

Looking back, what do you now know about driving construction innovation that you wish you had known when you were on the estimating team?

AJ Waters (05:36)
Yeah, that’s a tough question. I think the biggest thing that it comes back to that I wish I’d known is…

understanding how to meet people where they’re at, right? Like there are going to be different levels of excitement when it comes to innovation and change. There are going to be different levels of aptitude when it comes to picking up a new technology and and being able to tailor your delivery, your communication, your training to people where they’re at and with what they’re comfortable with.

If I had to do it all over again, you know, going all the way back and skip a lot of those lessons learned, that’d be the number one thing that I’d take back with me is understanding how to meet people where they’re at.

Rishi Srivastava (06:26)
Yeah, it’s very difficult to know somebody else’s perspective and position too. Yeah, we all think that everyone just knows about things just exactly like us. What do think about that?

AJ Waters (06:33)
Yes.

Exactly.

Yeah. It’s a big thing. Empathy is a big thing when it comes to change management. And if you’re not willing to take a step back and spend a little bit of time in the shoes or the boots of the people that you’re hoping to change, you’ve got a long road ahead of you. And so the ability to take that step back

to help them see what’s in it for them, to understand why this might be difficult and how you can mitigate those difficulties and to understand where their holdup is. All of those are just little nuggets that it takes spending time with people in their environment to truly understand.

Rishi Srivastava (07:28)
Insightful. So instruction technology and risk. That’s our next section. You’ve seen countless ERP and project management deployments. What are the most common pitfalls construction companies face when digitizing their workforce?

AJ Waters (07:44)
I think the most common is they try to roll out a solution without understanding whether or not it’s truly a fix for the people that are impacted. And again, this kind of goes back to understanding where the people are at. The number one problem that we see when digital transformations go awry is that they are

They’re attempting to roll out a technology that like leadership or IT or someone sourced found Decided it it was something that they wanted to go with and by the way now we’re gonna tell operations right now We’re gonna talk to the field teams and say hey, this is coming

take a step back, the field team should have been one of the first people involved, right? That the doers, the people who actually take action in the technology, they need to be the first ones consulted. And if we’re only letting them know once we’ve already signed the agreement and put together the implementation plan, then we’re gonna be in for a real struggle. And kind of tangential to that,

Like their opinion matters. So if you bring them in, listen. That’s one of the lessons learned. had to deal with the hard way is, you know, we got that feedback from the field and they were adamant at one thing. IT was adamant on something else. IT got the final decision and the field team revolted. And it was a major catastrophe. So you got to be real careful with that.

Rishi Srivastava (09:15)
yes.

AJ Waters (09:23)
A, you need to get their feedback, but B, you gotta listen to it.

Rishi Srivastava (09:25)
Yeah, yeah. And the field’s job is so chaotic, like you try to bring some sort of normality or some sort of in order with these workflows. And of it’s not possible to do that.

AJ Waters (09:42)
Well,

and what people often overlook is some of these systems, they add time. They add complexity. Like before I could just write this down or I could maybe just take a picture and text it or whatever it might be. Now I’ve got 18 fields to fill in and they’re all required and I’ve got to add three attachments and all this. You’ve got to understand how much time you’re actually adding to the field team’s workflow.

Because what they want is less, not more, right?

Rishi Srivastava (10:14)
Yeah, yeah. Again, they’re dealing with risky site conditions sometimes, and you’re asking them to do all this digital work. So next question is, why do you think construction technology has struggled fully integrating to the job site? And what strategies have you seen work best?

AJ Waters (10:35)
Yeah, so again, that goes back to we are struggling to integrate into the jobs site when we throw technology at the job site for the sake of technology, right? And I often, like I will argue the point that construction is slow to adopt technology. I don’t think that’s true.

If you go out to a job site today, there’s drones flying around, people are wearing 3D backpacks. There is technology everywhere on a construction site. What we’re maybe struggling with or we’re slow with is the integration of the technology, right? Everything’s a point solution. Historically, that’s how we’ve tackled problems is we’ve just squeaky wheel gets the grease. so we can’t…

we can’t get a holistic picture of the data because everything’s siloed and broken into these different structures. So I think that’s where the challenge is, is we keep throwing stuff at the job site for the sake of a new technology or an innovation without looking at the holistic picture and understanding how is that going to help us finish on time or how is that going to help us finish under budget in the sense of

our grand picture of the project. Like it’s sure it’s going to solve this one challenge. But what about the overall project as a whole?

Rishi Srivastava (12:00)
Yeah, the T-ray degradation is a tough thing, know? There’s like thousands of, you know, maybe pieces to it, like some tools, some equipment, some software, like, and all of these things, they’re not necessarily talking to each other.

AJ Waters (12:16)
Right, exactly.

Rishi Srivastava (12:17)
What’s the most understood risk factor companies overlook when they delay adopting connected project data systems?

AJ Waters (12:26)
Yeah, so.

I think the most misunderstood or the most overlooked risk in waiting on construction technology is the cost of doing nothing, right? Everybody always looks at the price tag of what a new software will cost them, what the implementation fee is, what the subscription fee is, all that. But no one ever sits down and does the math on what status quo costs, right? The cost of doing nothing.

Like what if you don’t implement six months from now, what have you lost? You’ve lost six months of better productivity. You’ve lost six months of better data. You’ve lost how many millions in a busted Excel formula, you know, whatever it might be, right? So the cost of doing nothing is something that people overlook all the time because they assume that doing nothing is free. And it really isn’t. I mean, you

Rishi Srivastava (13:13)
Hmm.

AJ Waters (13:23)
you might lose people because you decided to do nothing and they went to work for a competitor that has systems in place that makes their lives easier, right?

Rishi Srivastava (13:34)
Yeah, you know, the risk of unknown is there, right? When people are not doing anything. So how do they mitigate the risk of unknown?

AJ Waters (13:42)
that’s a really good question. takes it. Asking better questions and you have to. You can’t just ask the question of, you know, a surface level question of what what happens if. You’ve got to go a layer deeper and then even a layer deeper than that, right? You’ve got to get to third level questions. What happens if X? OK, how does that impact why? All right.

What does that mean for these people over here with Z? Right? So you’ve got to take your assessment layers deeper than most people are willing to go because it takes work. It takes effort and it takes time. And I think one of the things that companies often get wrong is digital transformations are side projects and they really shouldn’t be. Right?

because what happens when you have a side project? The first thing that you’re gonna let slip is the side project, right? And so you’ve got to really, you’ve got to take ownership of a digital transformation. It can’t just be this little side thing that we do and hope to get to the right answer.

Rishi Srivastava (14:51)
Yeah, commitment. When so should a contractor push, pause, or even walk away from a technology implementation that isn’t serving them?

AJ Waters (15:01)
So I said this the other day on social media and I was expecting to get a little bit of pushback on it but I hadn’t heard anything yet. So maybe it’s right. If the field hates it, if your people hate it, you’ve failed. Like that right there, that’s your sign. This one’s a failure. If they’re screaming at you, this is stupid or this is dumb or they hate…

Rishi Srivastava (15:16)
Mm-hmm. Yeah.

AJ Waters (15:26)
what’s going on, your digital transformation needs to either stop altogether or needs to pause and reassess and you need to go back to the drawing board. Because again, if they’re gonna hate it, adoption is gonna fail. That’s the metric that matters. If there’s no adoption, there’s no transformation.

Rishi Srivastava (15:47)
Yeah, nobody’s adopting and is that when you walk away? From a technology implementation.

AJ Waters (15:53)
I mean,

you at least need to press pause and reassess, right? You either you either walk away or you start over and do it the right way. You know, the second time I think too many companies are willing to just continue to sink money into a transformation because it has to succeed, right? Like like we have to do this and they’re unwilling to accept

failure and learn from it. Right. And so those sunken costs like you could lose again years of better efficiency trying to beat home something that’s already failed.

Rishi Srivastava (16:34)
Yeah, some cost is really hard to get away from.

Next section is on innovation, AI, and digital transformation. Where do you see? Yeah, yeah. Is it your favorite topic too? Or no?

AJ Waters (16:44)
Oh, AI, everybody’s favorite topic.

I mean, it’s… we’ll get into it.

Rishi Srivastava (16:54)
Where do you see AI making the biggest impact in construction workforce today and where is still overhyped?

AJ Waters (17:02)
So my opinion on construction AI right now is a lot of what you’re hearing from companies about their AI is noise, right? We’ve been hearing for a long time from companies that are doing artificial intelligence on like schedule analytics. But really the answers that they’re sending back to us are stuff we already knew, right? And that’s just frustrating. It’s not.

artificial intelligence. It’s like, yeah, I knew that that thank you. Right. And so when you’re getting answers back that that you already knew or that you already understood, you don’t you don’t feel better about the situation. You just you feel frustrated in and some of the other overhype on on on AI is, you know,

Progress measurement is a big thing that they’re trying to get, whether it’s cameras or scanners or what have you. There’s a lot of nuance to that because like, how do you understand what’s up in the cable tray? Or how do you understand what’s behind, you know, certain, certain piece of his pieces of equipment that have taken up some significant space? So we’re still, we’ve still got a way to go on, on some of those things where I think

Rishi Srivastava (17:53)
And.

AJ Waters (18:17)
real AI solutions are at right now are in data entry, information retrieval, predictive analytics. Like those are the three things where artificial intelligence can really give me something that’s going to save me a little bit of time. Whether it’s pre-populating a form based on where I’m at or what I’m doing, and I’m just validating that.

or whether it’s giving me information based on something that I just scanned, right? Or a question that I’ve asked, you know, chat bots and being able to look up a paint color that’s buried in the specifications, right? Without having to go know the exact page or being able to see risks or trip wires in my metrics because I’ve preset some zones.

without having to go look for them myself, right? Like those are the things that are going to save me a little bit of time. And if you can put all of those together, that’s when you start accelerating your decision-making.

Rishi Srivastava (19:21)
I was so well said we had being human are automating AP data entry. AP invoices, credit card receipts, delivery tickets, purchase order, statements, reconciliation, those kinds of things, know, they’re things that are so demeaning to humans sometimes in some of those tasks. ⁓ So.

AJ Waters (19:41)
Right. Yeah, like I don’t need to

be a data entry clerk, right? Like that I have more important things to do.

Rishi Srivastava (19:47)
Yeah. Yeah.

One big thing with AI is also giving the human the ability to validate the AI’s work. What are your thoughts on that?

AJ Waters (19:59)
Yeah, I I think at this point, that’s necessary, right? Like we need to double check AI and make sure that the answers that are being surfaced are logical and make sense in the context, right? Because it’s going to take a while for artificial intelligence to truly understand the context of the job site. You mentioned the chaos that’s there, right? And in…

The last thing that we need is artificial intelligence suggesting that we add glue to our cheese to make it stick to the top of our pizza. Right? Like that’s a real thing that happened. And so you’re still going to have to validate a lot of that. So some people like to use the phrase augmented intelligence, right?

Rishi Srivastava (20:34)
Mm-hmm. Yeah, yeah.

AJ Waters (20:45)
Artificial intelligence gives me an answer, but then I have to validate it. So it’s really just augmenting my brain. Like it’s giving me a head start and it it’ll be a bit before we can fully trust that. I don’t know if we ever want to fully trust it. We’ll have to rewrite contracts if we’re going to do that because because at the end of the day somebody’s liable, right? And and the human needs to double check that because you can’t just point to the chat bot and say, well,

They said it, not me.

Rishi Srivastava (21:13)
Yeah, yeah. You’ve helped craft demo stories and solution messaging at innate and Kahua. How do you balance tech speed with the reality of customer adoption cycles?

AJ Waters (21:31)
You know, this is something that I myself have had to change my perspective on over the years because I used to think, I used to think that you wanted to go all in like that, that, that, that all in out of the box platform was, was the solution that, that the industry was looking for it had, it would have best practices baked in. You would, you would have low configuration needs and

and just some tagging and you’d be off and running in. The more deployments that I’ve worked with and the more companies that I’ve talked to, the more I’ve realized that the nuance between how people do things, one size never fits all. Right. And so while we think with with tech speed that we can get people into this out of the box.

Let’s get running fast solution. The adoption is never really there because it’s such a culture shock, such a change that it really struggles to take hold in the field. And so kind of the way that my perspective has shifted over time is yeah, out of the box solutions are great. They give you a head start.

But if you don’t have the ability to tweak that down to the level of your business process and how your company works and how your people work, then you’re stuck conforming to a software. You’re stuck trying to act like your company has to act in the way that the software prescribes you to act. And that really hurts adoption. So out of the box platforms are good.

platforms that let you kind of build on top of that with low code, no code or what have you. They’re better, right? They allow you to get that quick win, but then also scale and adjust to your way of doing business. And so that’s something that while we all think we can be fast and we can implement fast and we can get you up and running adoption, adoption suffers every time we try to

force companies into something that’s one size.

Rishi Srivastava (23:42)
Yeah, definitely.

If you could design the perfect construction ERP or project platform tomorrow, what capabilities would it have to truly connect the back office and the job site?

AJ Waters (23:57)
You know, it was kind of you to send me this one early so I could think about it. I think this is the wrong question. I think we’re asking the wrong question because I think the job site and the back office are pretty well connected. We’ve got that, we’ve kind of got that figured out across project management softwares. It’s everyone else that we’re walling out of the project that is the problem.

Rishi Srivastava (24:04)
Okay.

AJ Waters (24:22)
And what I mean by everyone else, it’s the owner, it’s the architect, it’s the engineer, it’s the permitting agency, it’s anyone else that we have to interact with. It’s the subs in their submittals. None of them are connected. Everybody’s outside the system and we either say, hey, here, here’s a login. You come into my domain and you do all your work in my data warehouse. Or we…

we go have to log into theirs, right? And we give either way, somebody’s getting the minimum effort possible to do duplicate entry. So the connection point that we really need is between stakeholders, between domains, right? We need connected networks that allow an owner’s domain of the project management system to connect to the.

Contractors domain in the project management system to connect to the subcontractors domain of the project management system so that when I submit an RFI, I don’t have to go log into somebody else’s system and recreate it so that they can answer it for me and I can route it back out through my field team. Right. Like that’s the missing connection point. And that’s that’s what we need to solve for right away.

Rishi Srivastava (25:40)
Hmm, that’s a very interesting answer. So one problem I see there is, you know, various parties in this construction workflow, let’s say a vendor versus customer. mean, they cannot have access to the same data. I mean, my vendor cannot come and take a look at all the projects that I have. It’s very complicated to share data across organizations where there’s actually

some commercial contract setting between.

AJ Waters (26:10)
Yeah, and see, that’s what happened with a lot of the platforms that were designed 20 years ago. Like that was the mentality that they had, right? And so they set up the walled gardens. Well, they built the walls too high and they can’t seem to cut doorways into them to allow the data that does need to flow like a pay app, like me sending a pay request to you. Like that data needs to flow. You don’t need to see my progress and my actuals and all that.

that are tied to the pay app, you just need the pay app. So I don’t have to go log it in your system and then wait for it to come back and then reenter it into my system, right? So what’s interesting is newer platforms that are coming to market now saw this trend, saw this issue and have figured out how to build those pipes without taking down the walls.

Rishi Srivastava (27:03)
OK, OK. So do you see AI and automation reshaping the relationships between among CFOs, project managers, and field teams?

AJ Waters (27:14)
Well, I think the big thing we’re going to reshape communication speed or at least I hope right again, if we go back to AI and some of the automation the things that find real solutions, we’re trying to save time. We’re trying to automate data entry trying to automate information retrieval. All of those things are time savers when you talk about communication between teams one of the one of the

biggest struggles or challenges is that it takes time. Like I send you a pay request or I send you an RFI or I send you a change order and I could wait weeks for you to approve it or to get something back to me or you know to get an answer and every day that something goes unanswered

Especially when it comes to like RFI or changes is a day lost on the project, right? You can’t move forward and so if we can speed up information retrieval if we can speed up data collection and entry Then we can speed up response time and and all of a sudden I’m not mad at you because you’re not answering and you’re not mad at me because I’m not answering right like that. That’s how it

fixes that relationship or improves that relationship.

Rishi Srivastava (28:36)
Yeah, yeah, faster turnaround. So the next section here, AJ, is on training, communication, and operations. You’ve led training for ERP rollouts, that’s in hundreds of thousands of man hours. What works and what doesn’t when it comes to training construction teams and new tools?

AJ Waters (28:58)
I’ll tell you what doesn’t. Making everybody come into a classroom for a week and just talking at them. Or worse yet handing them the software and saying here you go and then walking away right. And so again this goes back to kind of meeting them where they’re at right. Like that’s what you have to do in

Rishi Srivastava (29:04)
Hehehehehe

AJ Waters (29:20)
We went through several iterations as we built out the training program for our transformation at Kiwi and it kind of started with that. Come into the classroom for a week and we’re going to we’re going to teach this and you’re going to do a couple of exercises. But for the most part, we’re talking at you for a week long on trying to teach you how to run a job site in a brand new system from from start to finish. By the end, we had we had kind of

We’d leaned into like the Khan Academy style of learning where you flip the classroom and we made them watch a bunch of videos up front. And then when we brought them in to the classroom, it was only a couple of days and it was all exercises. It was very little talking and a whole lot of doing. We’re going to click through the buttons. You’re going to take the actual actions and we’re going to move a project.

a couple of weeks in a matter of days, right? And so that really shifted how well and how quickly people adopted the system. At this point, mean, that was still, that was almost 15 years ago, right? That was 10 to 15 years ago. At this point, it’s a lot more short form video, right? Like on demand, like just think of how you learn something new. You probably search it.

on Google or YouTube, find a video and go watch it quick. And and that’s what training needs to be. It needs to be meeting people where they’re at and understanding how they best consume that training so that they can move forward quickly and again, not have to. I have to totally start from scratch every time they want to learn something new.

Rishi Srivastava (31:04)
Yeah, also the systems themselves, we need to design them to be very intuitive. I mean, there’s already projects that are happening on the site. And the systems needs to be simple enough for users to just intuitively understand everything.

AJ Waters (31:25)
Yeah, I don’t disagree with you, but I don’t think that’s enough, right? Like what’s intuitive to me may not be intuitive to you, right? Like a classic example, right? I play video games with my kids. I grew up on the original Nintendo, on the Atari, on those sorts of systems, right? I have to invert my sticks when I play video games with my kids.

Rishi Srivastava (31:37)
Mm-hmm.

AJ Waters (31:49)
If my kids try to invert their sticks, they can’t figure out where the heck that they’re going, right? They can’t move. They can’t strafe. They can’t do anything. So what’s intuitive to me is not intuitive to them, right? And so again, while building intuitive software is good, right? And we always should be striving for that. We do need to understand that it’s not enough. And that’s where I was like, you can’t just hand them an app and say, hey, this is intuitive. Go figure it out.

you still have to give them a little bit of a flavor of what is good for them.

Rishi Srivastava (32:22)
Yeah, my taking. How do you translate technical contact language into plain English so finance and field leaders can act on it?

AJ Waters (32:34)
Yeah, well, again, that kind of goes back to my my lack of vocabulary. I tend to use small words and and, you know, just speak very simply. It’s it all comes back to communication and understanding who you’re talking to and and what matters to them and focusing there. And in I mean, it’s it’s even more important in construction, right? Because

A lot of times we deal with people who are bilingual in construction. so if English is not their first language and you’re trying to communicate a concept and you’re using big words, that’s not going to go super well for you, right? So you’ve got to constantly understand how the other individual speaks, what’s important to them and tailor your delivery to that. That’s the plain English of

TechSpeak.

Rishi Srivastava (33:26)
Yeah, seeing other person’s perspective and where they are, it’s very tough actually, you know, I don’t know what all you know and what you don’t. So I have to kind of reasonably guess, you know.

AJ Waters (33:33)
It is. It’s so hard.

Yep. Or spend more time

with them than you maybe thought.

Rishi Srivastava (33:46)
OK, yeah. Can you share an example where poor communication during a technology rollout led to costly mistakes and how you helped correct it?

AJ Waters (33:57)
Gosh, I mean, that list is long. ⁓ Right. We did a lot of things wrong a lot of different times, and we learned along the way. I’d say probably the thing that we repeated the most often that we shouldn’t have done that led to mistakes was promising timelines before really understanding level of effort. Right.

Rishi Srivastava (34:01)
BOOM

AJ Waters (34:26)
Like everybody says, we’ll be up and running in three months or this, this system is going to go live in, you know, September, whatever, whatever deadline, arbitrary deadline you want to, you want to pick and not fully understanding the level of effort before making that announcement. And we had to backtrack on, on go live dates a number of times. Right. And, and so I think that

The best way that we got over that hump, you know, after the third or fourth time of doing it was we did a much better job of assessing our level of effort first and holding on announcing a go live and being a lot more.

just a lot more detailed in our analysis than we were before. We would think that we had an answer and we would ballpark it. But our lessons learned were let’s instead wait to announce till we’re certain versus announcing early and then having to move. So the business had to get used to that a little bit too, right? They had to understand. Well, we want an answer. When is this going to go live?

We’ll let you know when we know and you’ve got to be okay with that. Because if we give you the wrong date, you’re going to be mad at us for that. So like it had to be a total mentality shift across the company. But but that was one of the biggest lessons that we learned in communication was let’s let’s make sure we’re certain before we go out and and say, hey, we’re going to be awesome and going live and everything next week.

Rishi Srivastava (36:06)
In the pursuit of certainty, sometimes you may lose lot of time and momentum.

AJ Waters (36:13)
There’s something to be said about…

doing upfront work.

Not necessarily in secret, but not in public. You know what I mean? Like, yeah, we’re gonna overhaul our systems, but we’re not gonna be super public about that initiative. We’re gonna put together a team. We’re gonna have that team do a lot of work. And then once we’re ready, we’re gonna make an announcement. And so you can still build the momentum if you tailor the way that you communicate

to the masses effectively. You know what mean?

Rishi Srivastava (36:53)
Yeah, yeah. So in your view, AJ, what’s the right level of technology fluency a CFO or PM should have versus relying on IT or consultants?

AJ Waters (37:05)
So this is an interesting question because like, thankfully, I’ve had enough technical acumen to be dangerous throughout my career, right? Like I can’t code, but I understand coding well enough to ask certain questions or poke at things. But I don’t think that that’s necessary, right? Like I don’t, you don’t need a high tech acumen to be effective.

It’s like some of the great leadership principles and management principles out there. Hire for your weakness and then trust the people that you hire to get the job done. But the key word there is you have to trust them, right? The old Steve Jobs quote, like we don’t hire smart people and then tell them what to do. We hire smart people and they tell us what to do. So if you’re not

If you don’t have a high technical acumen as a CFO and you hire for that, you have to empower them and and and trust them to get the get the job done and not micromanage it right.

Rishi Srivastava (38:11)
Yeah, trust when you don’t have the competence and are the right people. The last section here is on people, leadership, and the future. You describe yourself as a construction transformation guru. What’s the biggest myth about digital transformation and construction today?

AJ Waters (38:31)
So in my opinion, the biggest myth with digital transformation is that it’s a one-time deal. Like it’s a project with an end date. Digital transformation happens and then it’s over. No, no, no, no. Innovation’s a culture. Innovation is a company’s lifestyle, right? It doesn’t end. It’s not finite.

You are continuing to iterate to get better to learn lessons to improve right and in everybody assumes that we’re going to go do this big digital transformation and we’re going to go live on a certain date and then we’re done. And and if that’s the way that you’re you’re working then the day you go live your system is already dying right if you’re not growing you’re dying that whole mentality.

So the innovation needs to be a culture. needs to be a continuous thing and digital transformation. If you can build a culture of change, think of how much easier it is to continue to improve when you’re not throwing change at people as this massive undertaking once every three to five years.

Rishi Srivastava (39:41)
Yeah, small incremental changes.

You’ve mentored cross-functional teams and future leaders. What people’s skills matter most when driving tech change inside construction companies?

AJ Waters (39:56)
I there’s two that are vitally important. The first one is you’ve got to be likable. If you want to drive change, you can’t be a jerk about it. It’ll stop in its tracks, right? And so you have to have a personality and a charisma that’s likable. You have to be a kind person, right? Just understand. And what goes…

right in hand with that. What’s equally important, we’ve talked about it multiple times today, is empathy. You have to have a certain level of empathy for the person on the other end of the table. You have to understand what they’re going through. You have to live in their shoes a little bit. And if that takes shadowing them or spending more time with them out in the field or wherever their role is, that’s what it takes.

Rishi Srivastava (40:24)
I

AJ Waters (40:43)
Because until you have empathy for what they’re going through again your your communication and your leadership and your change is going to fall flat because you don’t understand how it impacts them and how to best serve them right and so those two people skills being likable and just a genuinely kind person and genuinely caring having empathy for the people that you’re helping to lead through the change.

Those are the top two.

Rishi Srivastava (41:13)
One trick to be likable is to like other people. If I like you, it’s very hard for you to not like me.

AJ Waters (41:23)
Exactly. Yep.

Rishi Srivastava (41:25)
Looking five years out, the world’s successful construction leaders went more on the technology state, their process discipline, or their people skills.

AJ Waters (41:37)
Well, we’ve kind of hinted at this all along. It’s people all the way first. People skills first. It doesn’t matter how great your tech is. It doesn’t matter how good your processes are. If your culture is toxic, you’re going nowhere. And so you’re going to win on your people skills first and foremost. And everything else will kind of fall into place because you’ll attract some of the best people.

and those best people will solve your process problems. And by the way, the technology really doesn’t matter as much if you’ve got your processes down and your people are awesome, right? So I think that the thing that we have to focus on first and foremost, constructions of people business, it’s going to remain a people business until robots can hammer nails and pour concrete like we can.

And so you’ve got to get that right first and then the rest will fall into place.

Rishi Srivastava (42:33)
Yeah, I’ve had a lot of guests in this podcast and I don’t remember anyone saying that people is not the first, you know. If you could leave construction CFOs, job site leaders and our other audiences with one lesson about digital transformation, they should never forget. What would it be?

AJ Waters (42:59)
So it goes back to your old algebra classes, okay? Order of operations. The order in which you do things for a digital transformation matters. And what I mean by that is it’s people first, then processes, then the tech. All too often, and I’ve been guilty of this in my past as well, people try to start with the tech.

This is the solution. We’re going to go chase this. crap. Now we got to kind of make our processes fit into this tech. It doesn’t really fit. So we got to adjust them and here. Now we got to throw it at our people, right? We got, and that backwards mentality doesn’t work. If, if there’s one thing that I push harder than anything else, it’s the order of operations when it comes to digital transformations and the people.

process technology framework has to happen in that order. Get your people. Make sure you have your change team, your subject matter experts, the folks that are going to drive change. Have them take a deep look at the processes and where you can maybe make tweaks, changes and have some trade-offs and then evaluate the tech to get that all in alignment, right?

You do it in that order, things are bound to succeed. You change the order up and you take the people out of first place and heaven forbid you start with the tech first, things are gonna be really difficult.

Rishi Srivastava (44:31)
Let’s say I’m a construction company and I did get the people part right, but I went to the tech first and then the process. What would you imagine is going to happen to my company in doing this rollout?

AJ Waters (44:46)
So

in doing that rollout, you’ll get the rollout done because you have the right people and they’re influential and they’ll be able to kind of meet people where they’re at and they’ll be able to show them what’s in it for them. But your company is not going to operate in the same way that it did before because your processes are going to have to be conformed to the technology instead of the tech to your processes. Right. And so

You may lose checks and balances that you used to have in the past, or you may you may lose some efficiencies that you had that this tech doesn’t have. And so while the transformation will get done and you might take some steps forward, you might also take a few steps back in certain areas and you’re going to have to accept those tradeoffs, right? It won’t be as great as maybe it could have been.

Rishi Srivastava (45:40)
Yeah, yeah. This is one last question I’m thinking is, how do you imagine future construction job site? Let’s say five years down the line.

AJ Waters (45:52)
Good question. Five years down the road. I don’t imagine the job site looking much different except maybe the equipment is driving itself a bit more like that. That autonomous equipment may take some leaps forward and maybe there’s not as much diesel around. Right. That could that could be a big change. I still think the people are there.

Rishi Srivastava (46:11)
Sorry.

AJ Waters (46:15)
Most of the people are there finishing the drywall, laying the pipe, running the wire.

What I hope, like what my dream is or what my vision is for the construction job site is that it is bustling with those people and they’re happy, right? They’re not stressed like they are right now. They’re not burnout. It’s not a shortage where we’re trying to do more than we can with the amount of people. Like those are the things that I hope for in the job site of the future because we’re getting leadership right.

and we’re caring about the people first, we’re going to solve that problem. And no longer are we going to have unrealistic schedules that we’re trying to hit and unrealistic budgets that we’re trying to hit and all this stress and burnout because of those super optimistic but totally unreliable plans, right? And that’s my hope for the job site of the future is that we…

Because of AI and better data and all those things, we’ve figured out when projects really will get done and at how much. And we’re not hurting people by trying to hit dates that don’t make sense.

Rishi Srivastava (47:29)
Yeah, that makes sense. I’m glad that you didn’t say that the robots will be building the, you know, buildings and construction site.

AJ Waters (47:38)
I don’t think we’re there yet. I think we got more than five years.

Rishi Srivastava (47:43)
Yeah. AJ, this was great chatting with you. Job site conversation is always exciting to me because my background is not in construction job sites. So thank you so much, AJ, for your time.

AJ Waters (47:54)
Likewise, I’ve

had a lot of fun today. Thank you. This was great.

Rishi Srivastava (47:59)
course.