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Rhumbix CEO Zach Scheel SXSW 2017

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Zach's 3-minute presentation as part of startup pitch competition hosted by HOLT Ventures, Caterpillar Ventures, Brick & Mortar Ventures and Cottonwood Technology Fund.

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Rhumbix CEO Zach Scheel SXSW 2017

  1. 1. SOLVING THE CONSTRUCTION PRODUCTIVITY PROBLEM ZACHARY SCHEEL, P.E. CO-FOUNDER AND CEO OF RHUMBIX
  2. 2. RHUMBIX IS A LABOR PRODUCTIVITY PLATFORM FOR CONSTRUCTION COMPANY SNAPSHOT We use smartphones to collect data and communicate powerful insights to and from construction crews in real-time.
  3. 3. THE CONSTRUCTION PRODUCTIVITY PROBLEM 98% OF CONSTRUCTION MEGA PROJECTS INCUR COST OVERRUNS OR DELAYS 80% avg. cost increase; 20 months behind schedule 1 McKinsey Report, The Construction Productivity ImperativeConstruction & Non-Farm Labor Productivity Index
  4. 4. LABOR IS THE LARGEST AND LEAST UNDERSTOOD PROJECT COST LABOR PRODUCTIVITY Labor 50% Materials & Equipment 40% Overhead 9% Profit 1-3%
  5. 5. THE DATA GENERATED BY THE CRAFT WORKFORCE.
  6. 6. MANUAL TIME INTENSIVE ONE-WAY COMMUNICATION FIELD REPORTING TODAY
  7. 7. DIGITAL TIMEKEEPING DAILY REPORTS QUANTITY REPORTING T&M TAGS COMPLIANCE NOTES/PICTURES FIELD REPORTING WITH RHUMBIX
  8. 8. DAILY ACTUAL VS. BUDGET LABOR PRODUCTIVITY FOREMAN FEEDBACK REAL-TIME PROJECT VISIBILITY
  9. 9. FIELD-TESTED SUCCESS
  10. 10. FIELD-TESTED SUCCESS $200/DAY SAVED PER WORKER MINUTES SAVED PER WORKER, PER DAY 50% HEADCOUNT REDUCTION 88% REDUCTION IN TASK DURATION
  11. 11. RHUMBIX IMPROVES MARGINS THROUGH INCREASED LABOR PRODUCTIVITY LABOR PRODUCTIVITY Labor 50% Materials & Equipment 40% Overhead 9% Profit 1-3% 45%5%5-10% 2-3X INCREASE IN PROFIT
  12. 12. THANK YOU!

Editor's Notes

  • I’m Zach Scheel, CEO and co-founder of Rhumbix and I’m here to talk to you about how Rhumbix is solving the construction industry’s productivity problem.

  • Rhumbix is a labor productivity platform for construction. We use smartphones to collect data from construction foremen and workers and communicate meaningful, actionable insights back to them in real-time.
  • It’s no secret that construction industry has a productivity problem.
    We’ve lagged behind every other industry for 40 years, and the gap continues to widen.

    ZS: those stats are from a McKinsey report, The Construction Productivity Imperative, we should cite the report for the stats
  • And when you dig into why there is productivity problem, it’s undeniable that a major contributing factor is the cost of labor.
    Labor is the largest and least understood cost of every construction project.
    It makes up 50% of costs and therefore presents the biggest opportunity for improved productivity.

    We believe the solution to the productivity problem starts with data.
  • But not just any data: The data that matters most.
    The data generated by the craft workforce.
    Few solutions capture data on labor productivity, and even fewer share insights back with the workers and foreman who can really make a difference.

    [ZS] Maybe add something along the lines of “At Rhumbix, we believe the most-valuable data on the jobsite comes from the hands of the men and women physically doing the work.” I’m not married to that, but I think it’d be good to highlight that we’re generating data from the workers.
  • Today, data is a one-way street.
    Foremen collect information on paper and they’re never given feedback on their performance.
  • We’ve created an app that collects data directly from Foremen on the jobsite.
    Timecards, daily reports, cost codes, T&M tags, pictures and notes are now 100% digitized and shared immediately with project leadership.


  • PM’s, and Operations can now know on a daily basis whether they made money or lost money and why
    And Foremen get something they’ve never had before: access to worker data literally at their fingertips.
    Now, they can proactively manage project performance and share feedback with their team on a daily basis.
  • We’re seeing great results using Rhumbix in the field
    We partnered with Skanska on the construction of pre-fabricated bathroom pods over the course of a 10-week project.
  • We used our mobile app for Foremen to enter timekeeping data electronically, versus filling out paper timecards.
    Then, we used location-based technology to track the activities of the workers each day.
    At the beginning of every day, workers viewed their game tape and were able to brainstorm solutions for process improvements.
    For instance, the crew moved the location of their materials closer to the work area to reduce time spent traveling back and forth.
  • Skanska saved 95/min per worker per day, which amounted to $200/day in savings per worker.
    They went from needing 4 workers and 58 hours to complete a pod, to 2 workers and 7 hours.
    That’s a 50% reduction in headcount, and 88% reduction in task duration.
    And all of that came from sharing data with workers on a daily basis.
  • Companies using our platform are seeing a 5-10% improvement in labor productivity which results in 2-3X increase in project profitability
    But it’s not just about profitability
    To move the industry forward, we need to dramatically shift the cost structure so we can invest more in IT solutions like the companies you’ve heard about today.
  • When it comes to process improvement, there’s a temptation to look solely to advanced technology to solve our challenges.
    But let’s not overlook the immense value of the human capital we have on every project.
    Thank you!
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