The "Filing Cabinet" Trap
Why Subcontractors are Losing Margins in the Cloud
Explore why "going digital" hasn't solved the construction industry's biggest problems, and discover the shift from Systems of Record to Systems of Decision.
1. The Digital Filing Cabinet
We've replaced dusty filing cabinets with cloud platforms. Watch how documents flow into the system, but something critical gets lost along the way.
- • Signed contracts
- • Construction documents
- • RFIs and submittals
- • Change orders
- • Why the bid was structured this way
- • Original assumptions
- • Risk calculations
- • Decision rationale
- • Disputed change orders
- • "He-said-she-said" arguments
- • Eroded margins
- • Lost institutional knowledge
2. The Context Gap
The "trillion-dollar question" isn't "What is the current drawing?" You can find that in five seconds. The real question is:
"Why did we bid it this way, what exactly changed that's going to kill our margin, and what did we do last time this happened?"
Information Flow Through Project Lifecycle
- Labor rates based on crew availability
- Material costs from 3 suppliers
- Risk buffer for weather delays
- Assumption: Clear ceiling space
- Historical data from similar jobs
- Full context available at this stage
The estimator has complete context on why the bid was structured this way.
3. System of Record vs. System of Decision
Toggle between the two approaches to see how they handle the same situations differently. Click on scenarios to explore the contrast.
Drawing Change Impacts Bid
Field discovers conflict during installation
3-4 weeks after change
Emergency meeting, finger-pointing, costly rework
Change order disputed, margin takes a hit
Quick Comparison
| Aspect | System of Record | System of Decision |
|---|---|---|
| Focus | Accountability | Organizational Intelligence |
| Question Answered | "Who signed this and when?" | "What broke our original logic?" |
| Timing | Reactive | Proactive |
| Result | Margin creep | Margin protection |
4. The Decision Trail in Action
Follow a project from bid to execution. See how tracking the "why" behind each decision creates a defensible record that protects your margins.
Electrical package bid at $847,000
Flagged ceiling height as critical assumption
HVAC equipment revised - larger rooftop units
Addendum #3 impacts bid assumption from Jan 22
CO #7 drafted with decision trail documentation
CO #7 approved for $39,500
5. The Cost of Context Loss
Adjust the sliders to see how context gaps translate directly into lost margins. These numbers are based on typical subcontractor project data.
Margin Impact Calculator
Adjust the sliders to see how context loss affects your bottom line
Your Project Parameters
Total contract value
Average number of change orders
Percentage of COs that are disputed
Time spent resolving each dispute
Percentage of requested value approved
Impact Analysis
These calculations only capture direct costs. The indirect value—faster decisions, better GC relationships, institutional learning, and reduced stress—often exceeds the measurable savings by 2-3x.
6. From Commodity to Strategic Partner
The construction industry doesn't need more data—we're drowning in it. What we need is meaning.
The Last 20 Years
Systems of Record made us organized. We can find any document, any time.
- Digital document storage
- Compliance and auditing
- Context and reasoning
- Proactive insights
The Next Era
Systems of Decision capture the intent and logic as projects evolve.
- Decision rationale tracking
- Proactive change alerts
- Institutional knowledge
- Margin protection
The Key Insight
The most valuable thing a subcontractor owns isn't just their labor or equipment— it's their expertise and assumptions. When you start tracking the "why" instead of just the "what," you stop being a commodity and start being a strategic partner.
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