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Creative Construction Conference (CCC 2021) IOP Publishing
IOP Conf. Series: Materials Science and Engineering 1218 (2022) 012021 doi:10.1088/1757-899X/1218/1/012021

Approach for Data-driven Controlling of Construction

Projects using the example of Claim Management

L T Lenz, J-L Schmidt, A Riechmann and M Gralla

Chair of Construction Management, Department of Architecture and Civil,
Engineering TU Dortmund University

Ingenieurbüro für Bauberatung Univ.-Prof. Dr.-Ing. Mike Gralla GmbH

lisa.lenz@tu-dortmund.de

Keywords: Business Intelligence, Claim Management, Data-driven Controlling

Abstract. Current methods for controlling of construction projects are characterized by manual
processes, which are failure-prone, tedious and for that time-consuming and cost-intensive.
Furthermore, an additional challenge is caused by the absent dynamic in conventional controlling
processes, which is of high importance to avoid damages and ensure a proactive management of
a construction project. As construction projects are highly complex due to various influences
which imply an enormous amount of information and are designated by dynamic processes,
conventional controlling methods are insufficient and not able to meet these requirements.
Therefore, current data-driven developments which can deal with an enormous amount of
information are indispensable for a sufficient controlling of complex and dynamic projects.
Accordingly, within this paper an approach for a data-driven controlling solution is presented,
in which common data environments, databases and business intelligence applications are
combined to ensure an efficient and proactive controlling. To investigate the advantages of
business intelligence solutions for data-driven controlling the exemplary scenario of claim
management controlling is used. It is shown that the user is able to speed up the processes and
secure a proactive controlling by using a consistent database throughout the project. To achieve
these targets an automatic data orchestration and visualization of the claim offers is exploited.
Consequently, the claim manager is able to predict developments, identify risk potential,
investigate KPIs or take actions to minimize negative effects e.g., time effort and costs. The
requirements for these purposes are considered in a recommendation for action differentiated
regarding the individual elements of a socio-technical system (human, organization, technology).
The outlook includes an overview of potential technologies to ensure real-time analytics to
shorten reaction and damage times related to the claims by immediately initiating
countermeasures.

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Creative Construction Conference (CCC 2021) IOP Publishing
IOP Conf. Series: Materials Science and Engineering 1218 (2022) 012021 doi:10.1088/1757-899X/1218/1/012021

1. Introduction
The foundation for controlling is represented by financial accounting, as it generates the relevant
information which management needs to fulfil its functions. It incorporates procedures for the
systematic acquisition and evaluation of all measurable relationships and processes for the purposes
of planning, steering and evaluating operations of a company. For this purpose, internal and external
information in the form of data has to be gathered and evaluated to provide a decision basis for the
management of the company within the framework of controlling [1]; [2].

A so-called control loop model for controlling is used (see fig. 1) to be able to react to dynamic
changes and includes the detection of changes based on a continuous matching of target and actual
data, as well as a steering action mechanism. Planning represents the target definition of all relevant
requirements for the execution of the construction project, such as the qualities, construction
methods, scheduling, costs, etc. Steering is used to define the management of the construction
processes on the construction site. Evaluating summarizes the process steps recognize, check,
analyze and forecast. The recognition corresponds to the actual recording of all events on the
construction site using the standard construction site reporting procedures, such as daily construction
reports, hourly rate records, etc. The processes checking, analyzing and forecasting are defined as
the verifications of various target data to actual data. The results of these checks initially identify any
existing target-actual deviations, which must be analyzed in terms of the area of responsibility from
which they arise and what effects, for example on time schedules or costs, can be forecasted as a
result [3].

Figure 1. Control loop model for controlling [3]; [4]

Within this context, the employees configure the planning processes and integrate any necessary
changes out of the control loop. The execution represents the realization of the steering specifications
on the construction site. Whereas disruptions can have a direct effect on them or can be caused by
environmental influences; these disruptions can be e.g., changes, additions, modifications of the
contents of concluded contracts or environmental influences such as administrative instructions that
cause an addendum.

The term of controlling refers to coordination in corporate management with the aim of maximizing
profits. Controlling processes regarding construction management are orientated towards a specific
project goal, primarily in compliance with specified targets e.g., costs, time and qualities. This
distinguishes the process in construction management significantly from industrial production with
its recurring processes [14]. The application of the controlling loop mentioned above, is therefore to
be carried out in defined time cycles. The interval length of each time cycle depends on various

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Creative Construction Conference (CCC 2021) IOP Publishing
IOP Conf. Series: Materials Science and Engineering 1218 (2022) 012021 doi:10.1088/1757-899X/1218/1/012021

specifications like the project status (planning or construction phase), the project complexity and
associated project risks as well as the project duration [5].
To implement a successful controlling within construction management it is firstly important that
transparent and comprehensive project goals (target values) are given. Thus, it is crucial to have a
cost target based on the project calculation with budget items, deadlines based on a time schedule
including milestones as well as quality targets based on e.g.,, construction descriptions from lease
contracts, specifications from the design or requirements for sustainability goals associated with
certifications. Each time the controlling loop is running, project controlling must request the current
key figures (actual values) from project management and evaluate them accordingly. If major
deviations from target values are identified, the necessary control measures must be initiated
immediately in coordination with the project management. The prerequisite for a functional and
effective controlling is that all information is transparently available to those involved in the
controlling processes [6]. Various approaches and technologies are available for specific domains in
controlling for construction projects, which will be introduced in more detail in the following chapter.

2. State of Research
Nowadays the required information acquisition, sensing and analysis for controlling in construction
management in the field of claim management in construction industry are characterized by manual
processes, which present a number of disadvantages (e.g.,, cost and time consuming). Compared to
the industry, some approaches and trends have already been developed in research in automated
project performance in the past, monitoring and control with the focus on gathering real-time data.
Navon developed a concept of automated project performance control (APPC) to ensure real-time
feedback for managers [7]; [8]. Further developments dealt with the idea of closing the control loop
by reporting leading performance indicators, such as equipment productivity by monitoring the
movements in real-time [9]; [10]; [8]. Nevertheless, from a technical point of view, after various
developments in data acquisition methods, there was a lack of platforms for the symbiosis of data
with appropriate data management systems [11]; [12]; [8]. From a conceptual point of view, the first
approaches were replaced by methodologies based on pull production planning and control [13];
[14]; [8]. Besides that, a BIM-based claims management system as a centralized information
repository for extension of time claims was developed [15].

However, a concept for a framework combining a platform with business intelligence solutions to
optimize the control loop model by using the example of claim management would be helpful to
visualize the project status and support the claim manager. Especially in major projects, which are
often characterized by numerous changes that lead to claims, a platform in combination with business
intelligence solutions is necessary, to manage the project sufficiently and to predict forecast scenarios
for future projects. This research paper, therefore, focuses on using Business Intelligence Solutions
for the controlling processes of claim management in construction projects. In the following section
application fields for controlling in construction management are presented to identify Key
Performance Indicators (KPIs) that are important for the development of a database for controlling
purposes in claim management.

3. Application Fields for Controlling in Construction Management

Controlling in construction management can be characterized as one area of an overall ‘construction
management concept’ which serves the purposes of construction measures for individual projects as
well as long-term goals of a company and its employees. Accordingly, all steps of planning,
controlling and managing the economic success regarding construction projects are involved in this
process. The application fields for controlling in construction management however can be
subdivided further and therefore identified as activities and results of cost planning, budgeting,
contract and claim management etc. (see fig. 2) [5].

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Creative Construction Conference (CCC 2021) IOP Publishing
IOP Conf. Series: Materials Science and Engineering 1218 (2022) 012021 doi:10.1088/1757-899X/1218/1/012021

Figure 2. Application fields of controlling in construction management [5]

This research paper focuses on the controlling process using the example of claim management.
Claim management is defined as the enforcement of, as well as the defense against addendum offers
(claims). Usually a ‘claim’ covers all constellations in which the contractor demands higher
remuneration due to changed and/or additional services and/or longer construction periods. A general
differentiation is made between: random quantity changes, performance modifications like removed,
changed or additional services as well as claims due to delayed construction periods [16]. In order to
ensure an efficient and proactive controlling it is necessary to define a mutual goal, which typically
is the economically success, as well as to identify the required Key Performance Indicators (KPIs)
for controlling purposes in this regard. KPIs in operational controlling are supposed to represent the
given complex facts in a quantitatively compressed way [6]. They can be summarized in Key Result
Areas (KRAs), which represent the superordinate categories that are decisive for the successful
completion of a project. Typically, those include e.g.,, quality, occupational safety, environmental
management etc. However, neither the categories of KRAs, nor the KPIs that are to be derived from
those are prescribed or predetermined generally and therefore need to be identified individually for
each project, business model and industry and thus for the purpose of controlling in claim
management as well [17]; [18]. KPIs are designed to elicit a specific desired behavior from the
performers or a visible project outcome. For this purpose, they need to be ‘smart’, i.e. specific,
measurable, executable, relevant and available on time [18].

In the context of controlling in claim management a general distinction is to be made between two
processes. The first part of the process is the audit of an individual claim which is an autonomous
process in itself and can be divided into four process steps [19]. Various results can be derived from
each audit that serve as KPIs. The resulting KPIs are to be defined for each project individually (see
fig. 3). The second part of the process reflects the controlling of the audited claims. The KRAs in
claim management can be differentiated by disciplines (structural work, façade, etc.) or cost groups
(costs for the building structure, costs for technical installations, etc.).

Figure 3. Audit of individual claims

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Creative Construction Conference (CCC 2021) IOP Publishing
IOP Conf. Series: Materials Science and Engineering 1218 (2022) 012021 doi:10.1088/1757-899X/1218/1/012021

A constant overview for the project manager, to guarantee a comprehensive cost tracking and cost
management should always be provided and maintained [20]. Therefore, it is crucial to define the
key performance indicators that must be monitored in order to ensure a comprehensive controlling
in claim management.

Within conventional controlling procedures the relevant information for those processes is available
in form of numerous documents, which are created by different project participants. For a data-driven
controlling solution the central storage of required information is crucial and must be ensured.

4. Controlling Databasis
Data is a valuable asset for managing and controlling purposes. The usage of information can e.g., secure
advantages in competitions and generate explicit market benefits [21]. Data therefore requires a
defined concept, in which digital representations of analogue information in the form of digital
symbols are arranged in a certain sequence [22]. It represents the solid base of an information system
and serves as an information carrier for the transport and processing of facts and information on a
digital level [23]; [24]. At this stage no semantic references can initially be allocated.

An essential part and the basis of using data in a targeted manner in relation to the controlling of
claims is the ‘data quality’, which is defined as the totality of all dimensions of a data resource
regarding its suitability, in order to fulfil certain requirements. Those dimensions are to be used as
evaluation criteria and represented in diverse theories. According to Wang and Strong 15 quality
dimensions are defined, which are assigned to four superordinate categories (see fig. 4). Each of the
individual ‘information quality many IQ dimension’ (IQ) includes factors that are responsible for the
success of an individual information system. To ensure the success and the quality of an information
system, it is therefore crucial to fulfil as many dimensions as possible [21].

Figure 4: Information Qualities Dimensions according to Wang and Strong [21]

To transform information into data, it first has to pass through a ‘data processing procedure’ as
presented in figure 5. Therefore, identification of data quality dimensions represents the start of that
procedure. Data gathering in this regard describes the collection of data, taking into account the
interdependencies of data, the dependency of technical aspects and the influence of the ‘data
gatherer’ [21]. The data gatherer is both, the source and responsible for the input of data. Therefore,
data gathering pictures the second step of the data processing procedure and defines the form of data
input, which is elementary for the goal of using data for controlling purposes.

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Creative Construction Conference (CCC 2021) IOP Publishing
IOP Conf. Series: Materials Science and Engineering 1218 (2022) 012021 doi:10.1088/1757-899X/1218/1/012021

Figure 5: Data processing procedure [21]

The third step in the data processing procedure defined as ‘data management’ describes the
organizational function that is responsible for the controlling processes. Therefore, time control for
a simultaneous provision of information and data as well as their fast and flexible processing have
become critical factors for the success of a company [23]. In this context, it is elementary that entered
data can be used immediately as well as stored for usage for an indefinite period of time. Database
systems are used to store that data systematically and without contradictions [25]. The stored data is
to be divided into ‘master data’, which is data that rarely changes, as well as ‘transaction data’, which
is data that changes frequently [21].

Within the data analyses, data is repeatedly checked to identify errors, even in already existing and
checked data collections. This for example is done by using suitable query models in the database
[21]. With regard to controlling purposes as one field of action, ‘Business Intelligence Solutions’
represent a convenient instrument to replace individual analyses of data, based on defined rules with
programmed automated compilations. In relation to figure 5, this can be referred to as step 4. The
following chapter identifies types of software systems and explains the approach of their usage for
controlling in claim management referring to individual examples.

5. Approach for data-driven Controlling

To ensure a comprehensive controlling in claim management three areas have to be monitored:

1. The total amount of claims overall,

2. The total amount of claims for each contractor,
3. The total amount of claims for each status and contractor.

By controlling those areas, the project manager has the possibility to get a global overview and the
possibility to quickly take countermeasures if necessary. In this paper three different types of
software solutions are presented as steps for the controlling process in claim management. Each
software respectively each step leads through an independent data processing procedure as described
above. These are then transferred one after the other into a superordinate overall processing, which
is explained schematically in the following (see fig. 6).

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Creative Construction Conference (CCC 2021) IOP Publishing
IOP Conf. Series: Materials Science and Engineering 1218 (2022) 012021 doi:10.1088/1757-899X/1218/1/012021

Figure 6: Three software solutions for controlling process in claim management

The first step contains the process of data extraction from a project management platform. Within
this platform all information like e.g., correspondence, contractual documents, defect management
as well as claims etc. are uploaded. Accordingly, all relevant information is stored centrally.
Important for the controlling process in this regard are the reviewed claims, the following process
applies: Each contractor uploads its claims onto the project management platform. Due to a given
deadline this triggers the review of the responsible auditor, with the aim to either approve or decline
the claim, respectively provide comments fur further negotiations. After the deadline is due and the
audit is done, each claim is to be considered within the controlling process. In the presented use case
three status are to be assigned as result for a reviewed claim, which are defined as:

Declined: Claims that are rejected and declined based on audit results.
Approved: Claims that are ordered and approved based on audit results and the
requirements on the construction site.
In Negotiation: Claims that are approved on the merits but still in negotiation e.g., due to the amount
or in need of further evidence and information.

With the three-status assigned here, it is possible for the project manager to check in which direction
the project is developing and to intervene immediately in case of deviations from the declared project
goals. By defining the according KRAs in which the reviewed claims are differentiated, it is also
possible to control very precisely in which area problems might occur. Within the second step the
second software applies. All reviewed claims are imported automatically from the project
management platform into a database. Required adjustments, for the import from the project
management platform into the database are solved and done automatically by corresponding queries
that ensure the quality and right form of information to be implemented. In conventional projects the
information must be transferred manually into software by the data gatherer, which is associated with
a high expenditure of time and error rates, due to the manual data input. The automatic data
acquisition allows a controlling in real time. As third step a business intelligence solution (BI
solution) is used to present the results of the evaluated data visually and comprehensibly. The BI
solution is used for the enrichment of previously defined and evaluated data (see fig. 7). All
previously performed analyses and subsequent definitions are combined and prepared individually
for reporting purposes. Data can be categorised and linked via filter functions and thus presented in
the form of an individual dashboard configured for the purpose of presentations.

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Creative Construction Conference (CCC 2021) IOP Publishing
IOP Conf. Series: Materials Science and Engineering 1218 (2022) 012021 doi:10.1088/1757-899X/1218/1/012021

Figure 7: Example of contractor within Business Intelligence Solution

6. Findings and Conclusion

The overall process of data-driven controlling in claim management shows an interaction of individual
data processing procedures into a superordinate process by automating traditionally manual process
steps through the connection of software solutions. By avoiding repetitive data input of the same
information by the user the susceptibility to errors is significantly reduced. As a result of higher-
quality database generated in this way, the automatic evaluation of this data on basis of KPIs can
represent a more precise evaluation of the actual state of claims. Furthermore, the process is
accelerated at the same time and the solutions are available within a short time, whenever they are
needed. Besides the technical perspective, the corresponding requirements out of the human and
organizational subsystems should also be considered.

A socio-technical system is an approach to investigate the interdependencies of the subsystems

technology, organization and human of a production process. In this context a detailed analysis of
the subsystems to derive the requirements of the functional relations and interfaces must be
conducted, because they are used as main design parameter [27]. The target is to create a system
which is coordinated at the interfaces of the three subsystems [28]. In this paper the production
process is figuratively the production of KPIs for controlling in construction management using the
example of claim management (see fig. 8).

Figure 8: Socio-technical system using the example of KPIs for claim management [28]

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Creative Construction Conference (CCC 2021) IOP Publishing
IOP Conf. Series: Materials Science and Engineering 1218 (2022) 012021 doi:10.1088/1757-899X/1218/1/012021

The basis for the organizational subsystem is introduced is adapted from the control loop model for
controlling in chapter 1. The consolidation with the technical requirements is described in chapter 3
and in chapter 5 the overall process for a data-driven approach for controlling with all necessary
software components is finally presented. The subsystem human, respectively the ability of humans
to interpret data is currently not fully reflected in the technology used. In relation to the application
case of controlling in claim management in the construction industry, the creation of KPIs and the
classification of the final output of analysed data in a context should be mentioned at this point. Thus,
although controlling of claims cannot entirely be automated with the use of data-driven processes at
present, but the execution components of the human being can be increasingly minimised.

In summary, the findings of the paper are, that the processes within controlling in claim management
with an data-driven approach can become faster and more efficient, repetitive data gathering and
mistakes can be avoided, the data quality can be increased and the availability of data respective
KPIs for controlling of claim management improved.

7. Outlook
Soon, controlling processes in construction industry could evolve even further towards automated
solutions. Artificial Intelligence (AI) based on machine learning could be used to observe human
decision making and thus adapt it later or generate forecast scenarios, that the user can proactively
interact to avoid further claims and not just react when they arise. However, this would require large
amounts of observable and well documented controlling process data.

Especially by considering a higher level of automation the human needs should be enhanced. There
have to be surveys what regarding controlling KPIs in construction management is important for
humans, what kind of configurable interface they need and overall it has to be an user friendly
solution, in order to ensure the user trusting the KPIs out of the system.

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[2] Cf. Meinen H 2020 Baubetriebstabellen (Baubetrieb, Bauwirtschaft, Bauprozessmanagement)
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Creative Construction Conference (CCC 2021) IOP Publishing
IOP Conf. Series: Materials Science and Engineering 1218 (2022) 012021 doi:10.1088/1757-899X/1218/1/012021

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der Technischen Universität Dortmund, Band 6, Köln: Reguvis Verlag p 54
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