BMD Group is a national civil and building contractor. BMD Urban is a major business unit of BMD Group, with an annual turnover of $450 million which operates, on average, between 70 and 80 live projects each month.
BMD Urban has implemented Octant AI for approximately three years, applying the technology to data collected over seven years, and across 460 projects. The purpose of the implementation is to demonstrate the business advantages of machine learning and artificial intelligence in predicting outcomes sooner than business norms and with better accuracy. Working with a number of senior managers, Octant AI is augmenting current business procedures with early warnings of project cost over- and under-runs.
To date, Octant AI has achieved the following key outcomes for the client:
- more accurate predictions and value over the first 60% of program duration.
- reliable warning of cost overruns (30% of program duration earlier) with up to 80% precision.
- Improved portfolio forecasting accuracy, circa 20% more accurate in predicting actual business results.
Scope of Services
Octant AI’s work with BMD Urban is ongoing, since its appointment in 2017.
- Data analytics
- Data pre-processing, cleaning, validation, and Extract Transfer and Load
- AI model training, testing and operational deployment
- Business dashboard building
- Change management support and training
Challenges and Opportunities
- Identifying troubled projects within the portfolio early enough for management intervention and performance recovery
- Improving revenue and profit in a tough industry, renowned for narrow margins and intense competition
- Using existing data to understand prior business and project performance
Solutions and Innovations
- Using this reference class of up to 200 million data points, Octant is able to sense patterns in the data relating to actual historical outcomes and provides accurate predicted outturn cost for comparable projects.
- This collaboration has provided strong evidence to demonstrate the significant business benefits Octant AI can provide in its ability to accurately predict outturn cost earlier than traditional methods are capable of achieving.
- Such early warning provides the business with opportunities to deploy targeted resources for early intervention at less cost, essentially providing a framework to improve commercial outcomes and mitigate inevitable commercial detriment of distressed projects.