So, how can blockchain enhance communications and streamline the process? Imagine a commercial development where the progress of construction and flow of payments are completely automated and transparent. Project milestones can be verified by all parties in real time, and payments are automatically released upon completion of such milestones. Owners can track the flow of payments downstream to ensure subcontractors and suppliers are being paid. General contractors can track the approval process for payment applications, as well as funding from lenders upstream.
This transparency would reduce the likelihood of payment disputes and enable parties to identify potential issues in advance of work stoppage, allowing projects to proceed on time.
The applications for blockchain technology in the design and construction industry are endless. Project information would be universally available to every level of the project team, leaving no more excuses for breakdowns in communication. Lenders, owners, design consultants, engineers, architects, general contractors, subcontractors and suppliers would all have the ability to update the project database in real time.
The lines of communication would be wide open. Shipments could be tracked, inspections shared, workflow schedules updated, change orders processed and submittals reviewed, all in real time, and all with a complete historical record of the contractual obligations and timelines surrounding such items.
Blockchain technology is here. The industry must now educate itself and push for mainstream adoption.
Rick L. Amburgey is an associate with Walter | Haverfield‘s Business Services group.