As cloud-based construction payments continue to gain traction post-pandemic, McCarthy Building Cos. is standardizing its payments in the Oracle Textura payment management system for all its subcontractors. McCarthy chose Textura for its ability to handle McCarthy’s high volume of payments and for its controls and management of lien waivers and compliance, according to Ryan Moret, director of applications in McCarthy’s Dallas office.
“We had a lot of room for improvement where we were still doing paper checks. We weren’t ACH transfers, nothing like that anywhere,” Moret says. “We had a custom ERP where we were tracking compliance items and there were some payment application functions. But there were a lot of processes that were done in Excel.”
He says the company’s old system was Oracle-based with custom code dating back to 2008. McCarthy is switching to a combination of CMiC and SAP for its various ERP needs.
Moret says paper checks, payment transparency and just tracking whether checks were signed, unsigned, cleared or held had become a hassle, and it was time to standardize and use ACH transfers. McCarthy had already used Oracle Textura on more than 200 projects, with nearly 100 of those projects delivered in a single month.
While the reception at Textura has not been universally applauded by McCarthy’s subcontractors, it is popular with most of them, Moret notes.
“We had some subscribers who were like, ‘Finally! Thanks, that’s a lot easier for us, that’s an industry standard tool.’ They know it, they’re getting on board,” he says.
Moret adds that there are also some that are less effusive. “We’ve definitely had some subordinates very, you know, who thought ‘that’s another complication of working with ‘the people.’
While payments have long been a manual process that often involved time sheets filled out on-site, as well as lien waivers and other financial instruments uncommon outside of construction, prime contractors like McCarthy have been adopting methods of payments since the COVID-19 pandemic, when it was more difficult to get office staff on site and automated processes gained wider acceptance in the industry.
The ubiquitous project payment spreadsheet, usually managed by a project manager or superintendent, has given way to cloud-based systems like Textura, with ERP systems like CMiC, IES and Acumatica also picking up some of the work. For McCarthy, the move is part of his broader mission to gain better insight into his own work from more transparent project data.
“[For a] transparency and data strategy you talk about [enabling] Artificial intelligence, spreadsheets don’t work,” says Morey. “We have to have a clear data strategy, we have to know where things are, it has to be organized, it has to be clear. Otherwise, our people up and down the chain, left and right of that chain will plug into any future AI we use and not know what they’re looking for; half the information will be missing.”
Moret says McCarthy maintains a data warehouse and is already creating reports that pull from different systems. There are also internal discussions about data governance, data quality and the consistency of data capture and processing. Having standardized and transparent payments is just another step on that path, he adds.
