The Challenges to Scaling Offsight Construction Series



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="573" src="https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-1-1024x573.png" alt="" class="wp-image-2009" srcset="https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-1-1024x573.png 1024w, https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-1-300x168.png 300w, https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-1-768x430.png 768w, https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-1.png 1445w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /></figure>



<h2 class="wp-block-heading">Intro</h2>



In our Challenges to Scaling Offsite Construction &nbsp;series, we will narrow in on the obstacles facing offsite and prefab construction businesses as it relates to implementation and execution and outline how alleviating these challenges can help remove the friction holding back offsite construction growth.







We will highlight the two primary challenges, Process and Pipeline and through the course of this twopart series discuss how implementing technology correctly can improve your overall manufacturing process, help build a consistent sales pipeline of projects, and ensure that the investment in your offsite construction business is set to scale and drive its full value. &nbsp;&nbsp;







<a href="https://www.offsight.com/post/the-challenges-to-scaling-offsite-construction-process-pipeline-2">Download the introduction to The Challenges to Scaling Offsight Construction Series here.</a>







<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="573" src="https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-2-1024x573.png" alt="" class="wp-image-2010" srcset="https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-2-1024x573.png 1024w, https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-2-300x168.png 300w, https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-2-768x430.png 768w, https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-2.png 1445w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /></figure>



<h2 class="wp-block-heading">Process</h2>







This post in our series focuses on the Process challenge that prefabricators and offsite construction companies must address to effectively scale their business and truly drive the speed, cost and quality advantages of offsite construction.&nbsp;







The process challenge occurs when offsite construction companies fail to implement a process in line with where the market is today and move to either extremes, over-automation or over-customization. &nbsp;Many factories attempt a high-volume-low-mix focused manufacturing process more akin to automotive manufacturing but without the corresponding demand, resulting in over automation and unnecessarily regimented workflows that allow for little flexibility and customization between projects.&nbsp;







<a href="https://www.offsight.com/post/the-challenges-to-scaling-offsite-construction-process-pipeline-2">Download the The Challenges to Scaling Offsight Construction: Process white paper here.</a>







<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="573" src="https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-3-1024x573.png" alt="" class="wp-image-2011" srcset="https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-3-1024x573.png 1024w, https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-3-300x168.png 300w, https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-3-768x430.png 768w, https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-3.png 1445w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /></figure>



<h2 class="wp-block-heading">Pipeline</h2>



In order to truly establish owner trust and secure a steady pipeline of projects prefabricators must embrace transparency. In our interviews and conversations with owners and construction managers, financial risk, the inability to assess prefab progress once projects start, and buyer hesitation, unfamiliarity with the prefab process, were listed as the most common points of friction. By addressing these pain points through greater visibility, real-time data sharing, and proactive communication, prefabricators can reduce risk, build confidence, and accelerate offsite adoption.







In this report, we will outline why technology is the solution to removing friction to build offsite by driving transparency between prefabricators and the owners and general contractors overseeing prefab projects.







<a href="https://www.offsight.com/post/the-challenges-to-scaling-offsite-construction-process-pipeline-2">Download the The Challenges to Scaling Offsight Construction: Pipeline white paper here.</a>







Product Updates &amp; Enhancements



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="573" src="https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-4-1024x573.png" alt="" class="wp-image-2012" srcset="https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-4-1024x573.png 1024w, https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-4-300x168.png 300w, https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-4-768x430.png 768w, https://cms.offsight.com/wp-content/uploads/2025/04/Build-April-4.png 1445w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /></figure>



<h2 class="wp-block-heading">From Whiteboards to Digital Workflows</h2>







Digitizing your prefab and offsite construction factory operations may seem like a big shift, but with Offsight 2.0, we’ve enabled our customers to seamlessly transition their operations and production teams from manual solutions like white boards on the shop floor to our fully integrated, centralized platform. We’ve built flexible workflows and customizable user interfaces enabling seamless input of production status, shop floor labor and access to assigned tasks, eliminating the need for manual spreadsheets, charts, time sheets, and work tickets.&nbsp;







Check out our&nbsp;<a href="https://www.offsight.com/post/from-whiteboards-to-digital-workflows" target="_blank" rel="noreferrer noopener">full product post here.&nbsp;</a>

In our Challenges to Scaling Offsite Construction  series, we will narrow in on the obstacles facing offsite and prefab construction businesses as it relates to implementation and execution and outline how alleviating these challenges can help remove the friction holding back offsite construction growth.

Build Offsight – April 2025

In our latest post of the Leaders &amp; Innovators series <a href="http://www.offsight.com/" target="_blank" rel="noreferrer noopener">Offsight</a> CEO, <a href="https://www.linkedin.com/in/vikasmurali/" target="_blank" rel="noreferrer noopener">Vikas Murali</a>sits down with <a href="https://www.linkedin.com/in/mwoodchc/" target="_blank" rel="noreferrer noopener">Michael Wood</a>, an offsite and healthcare construction expert who has worked in executive and managerial roles at <a href="https://oldcastleinfrastructure.com/" target="_blank" rel="noreferrer noopener">Oldcastle Building</a>, <a href="https://healthy.kaiserpermanente.org/southern-california/front-door" target="_blank" rel="noreferrer noopener">Kaiser Permanente</a>, <a href="https://northamerica.turnerandtownsend.com/heery/">Heery International </a>and <a href="https://www.medxcel.com/home" target="_blank" rel="noreferrer noopener">Medxcel.</a> The use of prefabrication and offsite construction is rapidly growing on healthcare projects as owners are <a href="https://www.dpr.com/media/blog/healthcare-insights-harnessing-prefabrication" target="_blank" rel="noreferrer noopener">seeing dramatic gains in speed, cost, quality and efficiency</a>. Mike has worked at some of the largest providers of healthcare facilities in the U.S.  In his prior roles, his team has set a goal of making 40% of all building components using prefabrication on any project. In this Leaders &amp; Innovators interview, Michael discusses the CCM (Capability, Capacity and Maturity) criteria he has leveraged to evaluate prefab vendors. He also outlines the changes in mindset and financial planning that owners need to accept if they want to move work offsite and harness the gains on their projects. He reviews the role technology will play in providing owners with confidence to adopt offsite construction and how technology can push the industry forward.



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="573" src="https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-2-1024x573.jpg" alt="" class="wp-image-2003" srcset="https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-2-1024x573.jpg 1024w, https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-2-300x168.jpg 300w, https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-2-768x430.jpg 768w, https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-2-1536x859.jpg 1536w, https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-2-2048x1146.jpg 2048w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /></figure>







V: As hospital designs become more systematized and repeatable, what percentage of buildings would be prefabricated? What prefabricated components would owners plan to source (e.g. bathpods, panels, fully volumetric modules, etc.)?







M: In my prior roles as an owner we have aimed for 40% of the total construction of the building itself, not the site inclusion, to be in a modular or prefab format. In a prior position as the team measured the first year performance we were at 19% and heading toward that 40% mark very rapidly. Presently, most organizations I have worked with are hovering just below that 40% with the intent to push that up collectively to 60 to 65% over the next three years.



The components are the typical suspects for prefabrication, plus a few more. We’ve been working from the frame of the building inward with structural engineers and other designers to actually prefab / modulize most of the frame. Moving from the frame to the exterior, the goal is to construct as much as we possibly can to a modular format.



In fact, most of the organizations I work with, don&#8217;t do a lot of onsite stick builds of the exterior components at this point. Most of these type of components on larger, more standardized builds are all prefabbed and then flat paneled. We put the components / wall systems on a flat bed truck and take them to the job site where they are lifted into place onto the frame.



In my experience as an owner we also studied how to pre-fabricate roof sections with a couple of large roofing organizations, contractors and solution providers.&nbsp; I believe that will probably be in the next generation of buildings, i.e. prefabricated roof sections. We&#8217;ve already panelized canopies and found those to be fairly simple, a lot simpler than we thought it would be.



The interior components are consistently becoming more prefabricated. Bathroom pods were the first component, these are all now standardized, the second has been headwalls. Organizations I worked with are now also working on standardizing wall systems for smoke compartments, patient rooms, utility type areas, support areas, etc.&nbsp; As an example many of these have been very successful on a couple of builds from 2022 to today modularizing a significant number of the electrical utility rooms. Within the acute care environment, the standard rooms include, EVS utility rooms, IT equipment rooms, etc.



We&#8217;ve also done some of the storage areas and have looked at the operating room itself.&nbsp; In most cases the team has defaulted to panelizing or prefabricating the operating room ceiling. Some organizations I work with are considering modularizing the entire operating room but it seems this has stalled a bit as designers and owners study this more closely. The science is there, we need to push this envelope to implementation.



We&#8217;ve really taken a look at the entire environment and tried to assess what we think can be done in that prefabricated format versus a customized build on-site. The goal for some of the organizations I’ve worked with, believe it or not, is to get to 80% or more of the building prefabricated. I think that the industry will get there at some point in time and I honestly think it&#8217;s the owners that need to emphasize the need for that efficiency – in the investment and speed to market. Frankly it&#8217;s the subcontractor community that is pushing the trade side of the equation at this moment.







V: In evaluating vendors that can meet your needs on these offsite projects, what are the primary criteria you are looking for? From your experience as an owner, what have you seen as the strongest traits and capabilities of the best prefabricators?



 M:&nbsp;That&#8217;s a big question, it&#8217;s one that&#8217;s taken us five plus years to even respond to. I think it&#8217;s one of the key pivot points of anyone who&#8217;s trying to do this from any particular focus, whether it&#8217;s a design firm, an engineering firm, a contracting firm, subcontractor or an owner. I think it is really one of the key pivot questions of the hour. We boiled down, quite frankly, an awful lot of different checklists, qualifications lists, and algorithms that we were trying to create into three things, and we broke it down into three words at the end of the day, and we stuck to this very religiously, and those three words are capability, capacity, and maturity, so CCM. Let’s begin with Capability.&nbsp; As a prefabricator, looking at your particular resources within your organization, whether it&#8217;s cultural or your business structure, are you capable of actually producing a prefabricated or modular component/system? Do you have the machinery? Do you have the technology? Do you have the staff who can engineer it? Do you have the political will within the organization and the cultural setup to produce that versus a traditional stick built offering? The second in our evaluation focuses on whether you have the Capacity? Do you have the physical plant to be able to do this? Do you have the financial resources to be able to purchase the material, do the designing, and assemble these components ahead of a traditional on-site timeframe? Overall this would significantly relate to the accelerated project schedule. At the prefabricator level, the schedule for procurement of the goods, when the material is delivered and when the material is assembled into a component needs to be closely managed. The assembled component may sit for days, weeks, months. In a normal on-site schedule, material is delivered towards the end of the project, is then picked off the pile and put into a component on the job-site. Then the payment is applied for, invoiced and paid.&nbsp; This can be a significant time span. Therefore having the capacity to hold, store and manage these components is key. We also have to accept a new investment time frame, where we now pay more of our investment upfront so evaluating the capability and capacity of the prefabricator is crucial. The third component we’ve used in our criteria relates to Business maturity. Do you have the personnel set up, the operations and the logistics to handle offsite projects at scale? In this case vendors which have established processes and a proven track record of going from the traditional onsite methodology that I outlined earlier, with “just in time” traditional construction to a planned factory assembly of components that has to be constructed days, weeks or months ahead – those who are set up for “production” will have an upper hand. For example a headwall vendor can prefabricate components literally years ahead of time, given they have an established, mature business, and the design standards remain stable.&nbsp; This results in an assurance that if those components are required on an active project they will arrive faster and more reliably than traditional construction. &nbsp; &nbsp; So in summary we look at &nbsp;those three things, capability, capacity and maturity, when assessing a vendor/partner. As we talk to other owners or prefabricators, general contractors, subcontractors, we boil it down to those three things. As an owner, we appreciate a very candid conversation with our potential partners as to where we want to go, where they are from an overall prefab perspective, and what we can do to help them get to that next level.







<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="573" src="https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-3-1024x573.jpg" alt="" class="wp-image-2004" srcset="https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-3-1024x573.jpg 1024w, https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-3-300x168.jpg 300w, https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-3-768x430.jpg 768w, https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-3-1536x859.jpg 1536w, https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-3-2048x1146.jpg 2048w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /></figure>







V: &nbsp;As an early adopter of prefab, what advice do you have for other owners who understand the huge upside and potential, but are hesitant to adopt a new process they are unfamiliar with? How can they best manage this new process and value chain to ensure they can deliver on the schedule compression, cost advantages and quality excellence that comes with building offsite?







M: When you make the commitment to building offsite you&#8217;re going to have to accept a change in your delivery methodology from a normal methodology that&#8217;s been in use for many years. In the United States, in the last 100+ years we’ve been doing stick-built on-site construction. The commitment to doing a prefab or a modular format, with a new delivery methodology is different to us but it&#8217;s actually how a lot of different industries have revised their work over time.



As an owner, you have to rearrange the finances for the project &#8211; you will be expending large sums of money up front to fund the materials and the manufacturing of those components. This is different than you would have normally done in a traditional construction investment cash flow bell curve. It&#8217;s not insignificant as we’re shifting somewhere around 25-35% or more of the investment forward in time.



In this manner we’re affecting the cash flow. In a bond program or if you&#8217;re working in investment capital, etc., you need to be talking to your finance team so that their expectations and reality, if you will, is different than that of a traditional &nbsp;stick-built model. You need to be sure that you are prepared to fund your offsite project properly. The other thing related to this that affects virtually everybody involved is the communication that the schedule just flipped upside down. The normal decisions that are pushed to later in a stick-built project now have to be decisions that are made before the first bill of materials even hits the factory floor.



For example, what finishes do you intend to use throughout the building? What&#8217;s the color scheme look like? It literally goes on and on down to the smallest level of detail that is needed before the first bill of materials arises and before the framing materials arrive at the factory. Once it does arrive, the component construction can then be done as efficiently as possible.&nbsp;



With a stick-built model that most people are used to, they’re watching the frame go up, then watching the enclosure begin. In larger projects that takes a year, maybe a year and a half, and then somebody walks into a user group meeting or decision meeting says “okay, now, here are the five paint colors, which ones do we use? Here&#8217;s the hardware schedule, what finishes do you want … “&nbsp; All those decisions have to move forward in time.



Virtually everyone involved with these projects is going to be much more involved at the front end. Most of us are used to the traditional construction methodology. This literally flips the pancake.







<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="573" src="https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-4-1024x573.jpg" alt="" class="wp-image-2005" srcset="https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-4-1024x573.jpg 1024w, https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-4-300x168.jpg 300w, https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-4-768x430.jpg 768w, https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-4-1536x859.jpg 1536w, https://cms.offsight.com/wp-content/uploads/2025/04/Medxcel-4-2048x1146.jpg 2048w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /></figure>



V: What role do you believe technology can play in helping prefabricators deliver on the major efficiencies and productivity advancements over traditional construction? How can technology help owners, construction managers/GCs and other project stakeholders coordinate on active prefab projects to drive the best outcomes?







M: I think technology is one of those key components that we have been missing the last 25 or 30 years and it&#8217;s coming at us so fast!&nbsp; The changes are so much more efficient and productive than it was even five years ago. We now have predictive technology whether it&#8217;s robotics or AI or other elements within the technology environment that allow us to visualize the final product while being able to break down all of the different components of each of these products down to the level of a number eight screw and how many of them do I need in the upper left one quarter section of a 10 foot by 20 foot wall?&nbsp; It&#8217;s an amazing level of detail.



Technology is allowing us to cut out a lot of waste. It&#8217;s cutting out a lot of redundancy and helping us look into sustainability issues. We can start to look at not just the traditional approach of how we affect the schedule but also how we affect the project finances overall. For example, am I throwing away 20% of that sheet of material because it&#8217;s not in the configuration I need for a CNC machine. In this case a computer can figure out how to sneak in five more small pieces out of this one piece that would reduce overall waste.&nbsp;



Technology can also tell us what order of assembly is the best and the most efficient or the most structurally sound. It goes on and on and on.&nbsp; The ability to track all of that for time, speed, efficiency and finances is incredible today.&nbsp;



Technology can assist Owners to know where a component or series of assemblies are &#8211; what&#8217;s the status, when it will be delivered, can we actually achieve our expected expedited time frame?&nbsp; Speed to market for the final product is key. That’s where technology can make a great difference. It will be different in the beginning as owners learn how to manage offsite construction. During the initial builds with this approach, they may need to accept a 2% &#8211; 5% premium over traditional construction. However, it’s not unreasonable to expect that premium can easily turn into 15% &#8211; 20% savings or more as this becomes a more mainstream practice.&nbsp; It won’t happen overnight. Owners need to accept that.&nbsp;



Overall technology plays a very central role in advancing offsite construction, and technologies that track all the crucial aspects of an offsite project together and are able to go up and down the value chain while providing project and progress details to all stakeholders, they&#8217;re going to take the market.

In our latest post of the Leaders & Innovators series Offsight CEO, Vikas Murali sits down with Michael Wood, an offsite and healthcare construction expert who has worked in executive and managerial roles at Oldcastle Building, Kaiser Permanente, Heery International and Medxcel.

Q&A With Michael Wood, An Owner’s Perspective

In order to truly establish owner trust and secure a steady pipeline of projects prefabricators must embrace transparency. In our interviews and conversations with owners and construction managers, financial risk, the inability to assess prefab progress once projects start, and buyer hesitation, unfamiliarity with the prefab process, were listed as the most common points of friction. By addressing these pain points through greater visibility, real-time data sharing, and proactive communication, prefabricators can reduce risk, build confidence, and accelerate offsite adoption.







In this report, we will outline why technology is the solution to removing friction to build offsite by driving transparency between prefabricators and the owners and general contractors overseeing prefab projects.

When a successful offsite project is completed it fuels greater  demand for prefab. As project pipelines build for factories, the need to complete these projects quicker and more cost efficiently ultimately drives more productivity and economies of scale. 

The Challenges to Scaling Offsite Construction: Pipeline

This post in our series focuses on the Process challenge that prefabricators and offsite construction companies must address to effectively scale their business and truly drive the speed, cost and quality advantages of offsite construction. 







As outlined, the process challenge occurs when offsite construction companies fail to implement a process in line with where the market is today and move to either extremes, over-automation or over-customization.

This post in our series focuses on the Process challenge that prefabricators and offsite construction companies must address to effectively scale their business and truly drive the speed, cost and quality advantages of offsite construction.

The Challenges to Scaling Offsite Construction: Process

Today, the number of unfilled onsite construction jobs stands at roughly 600% higher than a decade ago, the hourly cost for this limited labor pool has increased by close to 50% over that same time period. Without a corresponding increase in productivity, construction projects are expected to get even more expensive, take longer to complete, and face a greater risk of not being built at all.

Today, the number of unfilled onsite construction jobs stands at roughly 600% higher than a decade ago, the hourly cost for this limited labor pool has increased by close to 50% over that same time period. 