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Full Transcript · Episode 027

Why Digital Transformation Fails, and How to Fix It

AJ Waters · Procore Oct 15, 2026 56 min + 15 min Debrief 13 chapters · ~10,400 words
Transcript note Lightly edited machine transcript of the published episode and its Debrief, the bonus episode: fillers and crosstalk trimmed, and names the transcriber misheard corrected. Speaker labels may still be imperfect, and timestamps are approximate; the Debrief’s are keyed to the Debrief, not the main episode. The audio is the record. Listen to the episode.
Chapter 01 · 0:00 – ~6:30

The Road In: Nebraska to Kiewit

[00:00:00]
Orion Matthews

Welcome to the Major Project Podcast. I'm your host, Orion Matthews.

In this pod, we are learning from the people that work on projects around $1 billion, trying to tease out the lessons and learnings from these big endeavors. My guest today is AJ Waters, 20 years in major projects from Kiewit estimator, Google's data centers, and at Kahua, and now field COO for public sector at Procore.

He is also the Chief EngiNerd behind the award-winning TheEngiNerdLife podcast, and he may be the most traveled man in construction. At every conference I've been to, I think AJ has been there. I started this podcast with a mission to give listeners the value that I was getting from the hallway conversations at these mega project conferences.

So I can't think of a better guest to help with that mission than someone that's been to hundreds of these kinds of conferences. So AJ, welcome to the podcast.

AJ Waters

Thank you so much, [00:01:00] Orion, and I appreciate you having me. This is gonna be a lot of fun. I don't know if I'm quite the most traveled, but I definitely enjoy the ability to get out and talk with people.

Just like you said, those hallway conversations are gold. And so this should be a fun chat.

Orion Matthews

Awesome. Yeah, I'm looking forward to it. But before we get into the meat of it, maybe you can tell us, how does a math and physics kid from Nebraska end up on billion-dollar job sites?

AJ Waters

That's a really good question, because I grew up dreaming of construction. I was one of those kids who obviously built a lot of Lego, and I wanted to build stadiums and be a part of major projects. So when I came out of school I had a few folks tell me that maybe I wasn't quite sharp enough to be an engineer, and that's where the math and physics came in.

I was like, "Well, if I can't be an [00:02:00] engineer, I'm good at math. I'll be a teacher, and I'll teach math. That'll be the way that I go." But what happened was, along the way a scholarship that I had earned at school provided an aptitude test, and the gentleman took us out to Denver.

We took a test. The aptitude test came back and said I'd be a good engineer. And well, all right, then maybe I can make this 360. Well, the other thing that gentleman knew was he knew people in the construction industry, and so he connected me with a few folks that helped me refine my resume, helped me understand how to interview for internships, and that landed me an internship with Kiewit the summer after my undergrad senior year before my post-grad work, and that's what started the role.

So I knew a guy who knew a guy and that, [00:03:00] that was like guilty by association in a good way.

Orion Matthews

That's awesome. And then would you say you kind of fell into major projects, which is a very common story that I hear, and then just started loving it, getting in there. You started on the estimating side, is that right?

AJ Waters

Yeah, that's exactly right. So I was an estimator at Kiewit. We would do second estimates in my internship for major projects across the country. So the district that I worked for, we were doing second estimates on 500 million and up power plants on infrastructure, interstate jobs.

And so I got into doing takeoff and estimating by hand, coloring up the drawings before it was on screen. And then when I moved into the full-time work it kind of was by accident that I ended up being [00:04:00] the guy who would estimate the general conditions on any one of our mega projects that we were chasing.

So most of the time they were joint ventures, so I would put together the general conditions estimate for our half, and then we'd have to go into an estimate review, and I'd be sitting across the table from a counterpart that was 20 years my senior trying to argue why we need this many engineers or this many porta potties or this many labor hours to clean the site, right?

And it ended up I got to travel a lot because of that. So that's where I got the travel bug, because most of those projects weren't based in Omaha, where I was. And so those estimate reviews would be in DC, in Denver, in South Dakota. I got to go a lot of different places for that.

Orion Matthews

Wow. Okay, and then sort of last thing about your history I wanted to ask you, [00:05:00] different people go different tracks, and so you're working in the major project space, and some people kind of go like, "I wanna be on the owner side," or, "I wanna be on the contracting side." And then there's sort of a lesser path where people go into the sort of application side or almost like the data system side.

And I'm curious, you sort of chose that path with Kahua and now Procore. What made you pick that?

Chapter 02 · ~6:30 – ~9:40

The Same-Hat Test

AJ Waters

Oh, that's a really good question. So in the early 2010s I was still at Kiewit, and they were overhauling all of their systems. And many people were being picked to kind of go help with that as subject matter experts to review technologies, to roll them out.

I actually raised my hand. Instead of getting voluntold, I volunteered for that and said, "Hey, I kind of see this new iPhone thing and where it's going. It looks fun, and I wanna go hang out with these folks and work on some tech for a little bit." And I fell in love with it [00:06:00] while I was there.

And so I kind of, instead of rolling back off like a lot of the subject matter experts did, I looked for ways that I could continue to provide value there and asked if I could stay in the technology side, continue to develop the center of excellence and things like that. And it was a lot of fun for me. I was just one of those strange cases where it was like, "Oh, that looks cool. Let's go try that."

Orion Matthews

Cool. All right. Well, thanks for the history background. So for today's topic we're gonna be talking about major stories from the road, so not a single mega-project, but really we're gonna try and capture as much of those learnings that you've gotten over the years on from conferences and things like that.

So I'm gonna hit you with a few questions and see kind of what you think. First one is when you walk onto a site cold, what tells you in 10 minutes that it's in trouble?

AJ Waters

So I referenced earlier a lot of the major projects that I worked on were [00:07:00] joint ventures, right? And for me, one of the first things I notice when I walk onto a major mega project, if they're a joint venture and there are two different hats, right? If you see multiple hard hats around the job site, different colors or what have you, then right then and there I say, "We're not a team. We don't even... We're not even wearing the same colors yet." And so there's going to be some push and pull that's gonna happen, and whoever's got the extra half a percent or whatever in their side of the project is the one that's going to be trying to force their authority, if you will.

And so the first thing that I look for when I walk onto a mega project that, especially if it's a joint venture team, is, is everybody wearing the same hat?

Orion Matthews

And you know, how does that flow? Like, is it really just that there's infighting and ego [00:08:00] and things like that, and it's really just like you're not one team and so those projects just sort of turn into political battles?

AJ Waters

Yeah. It's just an inherent us versus them that you never addressed out of the gate, right? And so how can you feel like a team without wearing the same colors? Did you play sports, Orion?

Orion Matthews

Yeah.

Chapter 03 · ~9:40 – ~13:10

Voluntold: The Talk He Never Rehearsed

AJ Waters

Okay. So when you're practicing against your own teammates, right, and you're wearing the different color jerseys, it's a different feel than when you're all suited up in the same jersey on game day, right? Like, you go at each other in practice in mostly a good way, but sometimes it becomes adversarial. But it feels different when you're competing against the [00:09:00] person across from you, even when you're technically on the same team.

And it's just natural with us as human beings, the way that works. And so psychologically, getting in the same colors changes the way that you view the person next to you, even when you're supposed to be doing the same thing. And so I think that it goes a long way, and it's one of those intangibles that it's hard to measure.

Orion Matthews

That's a great one. So I wanna ask, okay, so you've been to conferences. Let's get into some of the good stuff. So before we talk about the presentations, tell me a crazy conference story. Like, what, something memorable that happened at a conference that wasn't really on script.

[00:10:00]
AJ Waters

Oh, man. Okay. So I had just started in the tech side at Kiewit and we were at an Oracle conference, right? So Oracle construction conference. I'm a young pup, right? I've been, I've been in the industry maybe five or six years. I'm still green.

And I get there, and I'm supposed to be presenting with a more senior gentleman from our office on a couple of different topics in that day. Well, he gets there, and his travel was rough. Like, he was struggling. And he says, "Hey, I need you to start the presentation for me. Just get the first part going, and I'll jump in when I'm ready."

And I'm like, "Sure, that'd be great." So I go up there, and I start talking, and I'm giving the first half of the presentation. And I'm getting to the part where it's time to transition, right? And the guy that I'm gonna throw it to is standing in the back of the room, and he's just signaling, keep going.

So I give both halves at in the same talk, and we did four before lunch. We did four after lunch. They proceeded to let me do the [00:12:00] last three by myself the rest of the day. And just so happened one of the gentlemen who came through as an attendee during one of those sessions was looking for a new lead to run the training and the rollout for the remainder of the tools after estimating, and so that's what led to me taking over training for the system as a whole.

So when it came time to rebuild the system and do the InEight thing, I knew the whole system, and it made sense to be one of the InEight subject matter experts. So it was really a crazy story, it's one of those skills. I have this unique ability to memorize songs in movies after one time hearing or seeing them. It's totally useless unless you like karaoke. But it worked for me there because that's what I used to figure out that talk when I had never even rehearsed it. [00:13:00]

Orion Matthews

Wow. I think the lesson learned there is that you never know if you're gonna get put on the spot. You're lucky that you could nail it. But if there's anyone listening that's like, "Oh, I'm gonna be going and sitting in the back," it's like, mm, maybe not. Better be prepared.

AJ Waters

Yeah.

Orion Matthews

Wow. Okay, let's try and grab some of that memory of yours. So again, you've probably been to hundreds of conferences. What's one of the best presentations you saw, and why, on megaprojects? One that sticks with you.

Chapter 04 · ~13:10 – ~18:30

Stories from the Road

AJ Waters

Oh, that's a good question. I saw a presentation once on new tech, and it was drone tech. They were doing a major earthwork project, right? And they were showcasing how the drone would fly and do the quantities, right? Every day. And what made this intriguing was instead of just sitting there, [00:14:00] and slide after slide after slide after slide, the drone flew in.

And they had it scan across the top of the audience, and just run a flight path during the presentation. And you could hear it, and it was... It distracted a little bit because it was obviously up there flying around, but for the most part you're still following along in the presentation.

But the purpose of that was the gentleman on stage said, "Hey, look the drone's done. We have theoretically a brand-new set of quantities, and I never stopped standing up here presenting to you. Like, I never had to step out and do something else." "The capture of the data did not interrupt my flow."

And it was a really well-executed delivery of a point, of a very important point that impressed me, that hey, this technology is non-invasive. Which is something that we all want from our tech, right? And so that one really [00:15:00] impressed me because you think you're just, "Oh, he's just here to show off his drone, and it's distracting," and all this stuff. And really what he was doing was delivering the most important point of the entire talk.

Orion Matthews

Huh. Set up and take down. Like, that's a great one. Okay. And then you've presented a bunch at these conferences. What's your personal favorite for the presentation you did? Like, what learning were you bringing?

AJ Waters

Ooh. So that's hard. I have two. My first favorite is one that I called kind of the owner's dilemma, where it came to... It's the whole concept, you know how... Finish this phrase: growth solves, Orion Matthews: All ills. [00:16:00]

AJ Waters

Yeah. Growth solves everything. But the second that you apply that to digital transformation, it totally screws everything up. Like, growth causes your people to have to go work thin, learn new things. You have to take what could be an awesome core team on one project, and you spread them out, right?

Because you need those people to make other projects awesome. When it comes to your processes, growth can either bloat them or expose them, right? And then when it comes to your tech, growth causes you to either not be able to scale the tech that you got or you start trying to force stuff into the tech that you have that it wasn't really meant for, which is why Excel ends up getting used for so much stuff.

And so growth is actually a dilemma when it comes to [00:17:00] digital transformation. And so that talk would walk through how to solve each one of those kind of issues, your people, processes, and tech as it pertains to growth.

And then the second one is one I built off of Simon Sinek's kind of famous TED Talk, Strong Opinions Loosely Held. So he actually stole that phrase from another gentleman, Saffo, I think, was his last name. And the whole idea is, like, we've been so focused on how construction should do things that even our technology went out and digitized how we did things, right? Like the RFI, for example. We didn't innovate the RFI with tech. We just made the paper form digital, right? That's all we did.

Orion Matthews

Yeah.

Chapter 05 · ~18:30 – ~30:30

Threes, Tens & the Learning Curve

AJ Waters

And we never stopped and asked ourselves, "Is that actually the right thing we should be doing? [00:18:00] Now that the paper's out of the way, what could we do instead?" And so the idea of strong opinions loosely held is, we hold tightly to these strong things that we've done for so long, and it's okay to have that grounded opinion, that thing that you're adamant about, but the second that you get proven that it's no longer necessary, maybe you should let go of that stronghold and hold it a little looser.

So those are my two favorite talks to really test people.

Orion Matthews

Those are awesome points. Okay, I wanna take them on... I wanna share a couple thoughts on that. So one, the growth cures all ills, not always true. And I'm reminded of the CEO of Rakuten, Hiroshi Mikitani, and he had a concept called the rule of threes and tens.

And so [00:19:00] he said, "Things break in threes and tens." So when you have a two-person team and you become a three-person team, you have to throw away all your old processes and start over. And then when your three-person team gets to 10, you have another break, and you throw it all away. And then when 10 gets to 30, it happens again, and then you have it at 100 and then 300.

And so he was sort of talking about how as teams grow, all the systems underneath them explode, and his view was that it happens in threes and tens, which I always thought was interesting. And kind of applies to mega-projects really because you're scaling up so fast, it's like you're breaking as you go really quickly.

And that makes it hard for technology to keep up and systems and people because you wanna plan it once and then kind of use the same system. So you don't really plan for system breakage, process breakage, things breaking down as you scale [00:20:00] very much, I don't think.

AJ Waters

Well, and what's so crazy about that is we plan for it operationally but not with our tech. Because when you look at how we schedule projects, like we know there's a learning curve at the start of an operation, and we don't expect to get our full production in the first couple weeks of that big operation, right?

And we just inherently know that there's gonna be a learning curve, and we're okay that we're slow the first two or three days that we're doing something. But when it comes to tech and we go through that lull, that little dip, whether we're scaling up a team like you said or we're introducing brand-new tech for the first time and we're like, "Oh, we're gonna turn this on, and day one we're all gonna be more efficient."

No, you're gonna be slower because you've never used it before, just like you are on an operation. And we just inherently get that when it comes to the operations, but when we look at the tech [00:21:00] we're like, "Oh, this is terrible. The tech must suck because we slowed down."

Orion Matthews

Why do you think people don't get that? Is it that we're selling tech to them, that it's a magic unicorn thing? Is it that people use Google, and they're like, "I get it instantly, and it's all great"? Why does that happen that people have that mindset?

AJ Waters

It's a good question. I think it's a little bit of the overselling and it's also a little bit of, like, we're just not open enough to have that conversation. We all know it from the tech side, and even if you're in the IT department within the construction company or the owner, you know it, right? And we just don't have that conversation up front because maybe we're afraid that it'll risk the deal, or maybe we're afraid that people will get cold feet on the change and turn back.

But yeah [00:22:00] it's definitely something that as soon as we can get it out in the open and plan for it, just like you were saying, it really makes things better for everyone involved, as long as we just have to be open and honest with ourselves.

Orion Matthews

I think you're absolutely right. I think part of the problem is that when you're on the tech side and you are talking with someone that's operating and you know, like you know that the tech is going to 100X their company. There's no question if you could just get them to stop doing their operations messy and get on board and actually transform themselves, the upside is massive.

But people, I think tech has failed so many people because of some of the things we've already talked about, that people are really scared of committing to a change like that and they don't [00:23:00] really see how the organization's gonna capture the value. So it's like there's this problem where you really want them to go through and transform themselves.

So trying to say, "Uh, it's gonna really suck," is just really tough. It's like a personal trainer taking someone on, it's like, "Yeah, your first six months of training, it's gonna be horrible. You're gonna hate it." Nobody starts that way. It's like, look at what great body you're gonna have at the end of this process. But the initial intake of getting fit or something is hard. So maybe we're overselling it.

AJ Waters

Yeah.

Orion Matthews

Okay, well, and then just jumping to your other point about how people don't question systems that have been in place for a long time, I'm reminded of an experiment with animals where they had bananas in the middle of a room with all these monkeys around. And then if a monkey took a banana, they would punish it.

And so the monkeys learned never to touch the bananas, right? And then they started self-reinforcing it. So if another monkey, a new monkey that came into the thing, tried to take the bananas, the other monkey would stop him. But then what they found is that after multiple generations of monkeys, they stopped doing the punishment for taking the banana, but the group would self-reinforce, and they never actually took the bananas.

So the whole point was that systems can get in place that are inefficient, stupid, and the group will self-reinforce those processes and never even remember why the original rule was set. It was like a whole new generation [00:25:00] of monkeys that never had any experience of why they shouldn't grab the bananas, and they were still reinforcing that behavior.

And I think that happens a lot in organizations, which is why I think young people coming in or challengers that actually do sort of the crazy monkey that grabs the banana is actually good. And sometimes you shouldn't punish those people too much. If you have a team, the one that's really pushing on these threads that seem inherently fixed sometimes comes up with the best ideas or helps you capture new things.

AJ Waters

Yeah, and one of the offshoots of that is true innovation, a true culture of innovation takes courage, number one, because you have to be willing to challenge that old school thinking, and number two, it requires the psychological safety to fail. Which in construction, we're so risk averse, we don't often give people that room to fail.

And to your point, if we're gonna allow these young [00:26:00] people to challenge us, which we should because some of this stuff does need changed, then we also need to be okay with a little bit of failure here and there, and not just reward people who are right, but reward people who are learning.

Because every failure is a new lesson learned, right? And so as long as it's not life-threatening, which could be some things, I'm not saying go out and let people fail when it comes to life safety, but if it's a new system, if it's a new process, if it's a new way of thinking, let's iterate on those. Let's fail fast. Let's see what we can do to move forward, and let's be okay with testing something and it not working.

Orion Matthews

So I think this is an awesome point. I have a follow-up question. But I think we're seeing some shifts maybe from all these data centers getting built out, [00:27:00] essentially the owners are techies.

Right. We probably have a 28-year-old billionaire right now that's looking at a $10 billion construction project, and the culture of tech is fail fast. Facebook's motto was like, "Move fast and break things." Which is the opposite of what we're talking about in construction.

So I'm hoping that the culture changes a little bit as a result of these new mindsets coming in. Why does construction have this lack of psychological safety, would you say?

AJ Waters

Well, for the longest time construction has been one of those just beat it out, tough it out, do the hard thing, right? And there were great rewards for people who were hitting numbers, and there was a lot of not reward, it's just been a tougher, more brutal industry for a long, long time. But to [00:28:00] your point, we're seeing changes, not just the culture because of who the owners are, but the culture because of who we need to bring into the industry if we're going to survive some of these labor numbers, right?

And so we're starting to see that shift away from just gut it out and go do your job to, "All right. We do need to pay attention to the mental side of this for people, and have a little bit more care and respect for one another."

Orion Matthews

Following your point on the labor numbers, I wanna ask you about that because at the conferences that I've gone to, I sort of see this problem where it's like everyone is retiring that has done these mega projects, and I don't see a lot of young people joining those [00:29:00] conferences. The ratio's gotta be pretty skewed.

Chapter 06 · ~30:30 – ~35:50

The Missing Floor

AJ Waters

Yeah, I mean, it is, right? We're retiring more than we're bringing in. That's for sure. I would agree that I do see more people my age and older than I see my age and younger at conferences. However, I am inspired by some of the people that I am seeing at conferences that are younger. The younger folks that are coming with energy, are coming with cool ideas, are coming with great stories.

And so there are pockets where I see contractors empowering younger folks quicker. A lot of times it's out of necessity, but those folks are stepping up to that occasion and delivering. And so while it's [00:30:00] not at the level or pace that I'd like to see in all cases, I am inspired by some of the shift that I'm seeing, and the younger folks that I do find at conferences definitely are the types of people that can take us to that next generation.

Orion Matthews

Well, okay, let's role model for them for a minute. Okay. Psychological safety here, you're on a public podcast. What's a failure that you've caused?

AJ Waters

Oh, boy. One of the first estimates that I was the lead estimator on was an addition to a hotel, and we were adding like eight stories above the parking garage that was gonna extend the hotel. And the drawings, when we did the preliminary estimate, the drawings for the concrete, it was post-tension concrete, one of the structural drawings said floor seven and eight, right? [00:31:00]

Like, there was a drawing for every floor except that one. It said floor seven and eight. And I caught it the first time we did the preliminary takeoff, and I duplicated that page in on-screen takeoff, which doubled up the quantities, right? And we got everything done. Well, we moved from conceptual estimating into design estimating into the final number, and we're doing the concrete, we're self-performing it, so this matters, right?

And by that time it was a full estimating team. I was the lead estimator. Someone else was doing the self-perform estimate, and I totally missed the fact that we didn't have floor seven and eight duplicated again, right? Everybody missed it, but I take full responsibility as the lead estimator.

Our form work [00:32:00] number was right because it came from a sub. We were just off on material, and we were off on labor. And we didn't know. Like, we didn't even notice, right? Everything went in. They're through like floor four and I get a phone call from the job site, "Hey, we're burning through quantity on the concrete and we can't figure out why."

And we start digging in and sure enough, there it was. We skipped a whole floor on concrete material. Luckily, we had a good contingency on that job and we were able to cover it, but that was a major fail that I caused, and to this day, people don't let me live that one down.

Orion Matthews

Oh, man. So you just straight up, you got the call, you saw it, you were like, lay back in your chair and just walked [00:33:00] down the hallway and tell your boss, like, "This is it"? Yep.

AJ Waters

Yeah. Yeah. It was one of those where I was like, "Here it is. We're missing an entire floor when it comes to the quantity." We got lucky because it didn't affect the form work. It's really just the purchase and some hours for the labor.

We have this bucket of contingency. It more than covers it, thankfully. Like, a lot of things went right so that we didn't lose our shirt on that particular operation. But yeah, it was one of those where within an hour I knew what was wrong from that phone call when they said, "Hey, we're burning through quantity. Can you look at it?" And yeah, you walk into the office and go, "Well, here's what happened."

Orion Matthews

Yeah. What's your advice for someone that might be listening to this that just realized they made a big screw-up? Like, how to make that go well?

AJ Waters

Yeah. Own it. The worst thing you can do is try to cover it up. [00:34:00] Own it. Explain what happened. "Here's what I learned. Here's how we move forward," right? So come to the table with some options to move forward. Own the mistake. Tell the truth. That's the easiest way to get past it. And it's way better than trying to cover it up or trying to blame someone.

The worst thing is blaming someone else, which I could have easily done, right? I could have easily pointed at the self-performing estimator and gone, "They missed it. What do you want me to do?" But no, that was my responsibility as the lead estimator to double check that work.

And so yeah, just take ownership of it, move forward. The book Extreme Ownership, right? In every situation you played a role, just accept that role and move on.

Orion Matthews

You know, one of the things I've noticed on this podcast interviewing people is nobody ever blames anyone. [00:35:00] I've never gotten a story out of some of these successful, talented people in the mega-project space where they're like, "Oh yeah, and then this other guy screwed me over." So the tip I'm left with is like you said, blame is like a cancer inside these organizations.

And you will end up getting fired over it because the leaders that run them, that's their number one flag. If they're watching someone and you're a blamer, you're marked for death. And then the second is bad news early. If you hide or obscure information to try to smooth out something that is an obvious problem, that's another death mark.

Like those two things I think will kill your career faster than anything else in this business.

AJ Waters

Agreed, 100%.

Orion Matthews

Okay. Well, thank you for sharing that failure story. While we're on the topic, you've been in digital transformation for 20 years. Maybe we can tell the audience, why does digital transformation fail?

Chapter 07 · ~35:50 – ~39:40

People, Process, Tech: In That Order

[00:36:00]
AJ Waters

Oh, gosh. It's a tough one. My easy answer, the CliffNotes answer is we get the order wrong. Okay? So in my personal opinion, digital transformation, the reason that the people process technology framework works is because we do it in that order. You get the people right first, then you figure out the processes, then you pick the tech last.

Why do digital transformations fail? Because we picked the tech and then tried to shove it down the people's throat, right? Or something of that nature. Or we decided that we needed to revolutionize this one process, and we went out and got the tech, and we never once asked the people who had to use it what they thought, right?

So if you mess up the order of operations, the digital transformation fails. And by golly, put the people first because [00:37:00] regardless of what that new shiny tech looks like to an executive in a boardroom, "Oh, that's the dashboard I need," or "That's the process that we want", the person pushing the buttons out in the field makes it look that way, and if you didn't ask them if it's harder or twice the work or triple the entry or whatever, and you find out after the fact, it's never gonna get adopted.

Orion Matthews

Well said. So you're saying tech was never really the hard part, it's the people?

AJ Waters

Yeah. It's always the people.

Orion Matthews

It's always the people. Well, this gets into... You wrote this great article, The 28 Rules for Building Smarter. Which of those 28 rules do you think you've broken before? And what's a lesson on that?

AJ Waters

So that's actually pretty easy. Slow is smooth, smooth is fast. [00:38:00] I tend to hurry. Not because I'm in a hurry, I just like to work fast. Like, I just like to go, go. And so I have a real problem with the slow down a minute, let's pause, let's double take and figure this out. I'm just like, let's move. Let's fail fast. All those things where I could have avoided the fail altogether if I paused for a minute.

Chapter 08 · ~39:40 – ~49:15

Truth Is a Moving Target: The Data Wars

Orion Matthews

It just reminds me, there's this story I think they tell this to Marines or something. But there was a submarine that was sinking, and there were these people in it. They needed to get into a different compartment, and they only had like 60 seconds to do it.

And so it's like, "You're gonna die. You have 60 seconds to sort this out." And they're turning this crank, those metal [00:39:00] door things, and it's like, "Oh my God, it's not working." But what they were trained on was slow is smooth. So they realized, "I'm panicking," and they took 15 seconds of breathing. Like, "Let's slow down for a second." You're gonna die. You just took 15%, 20% of your time. And they slowed down, and then they realized, we gotta turn it the other way. And they turned it the other way and they got saved.

And it's like, that's an example of how, yeah, slow is smooth, smooth is fast. Organizations kind of need that behavior too on these mega-projects sometimes, stop, think, meditate, and then decide what you're gonna do.

AJ Waters

Yep. And you're absolutely right. I stole that phrase from the Marines. They're the ones who are famous for it.

Orion Matthews

There you go. Well, on your 28 rules, you also wrote that truth on a project is a [00:40:00] moving target. Can you tell me a little bit about that?

AJ Waters

What's true today is not necessarily true tomorrow. A perfect example is a drawing revision. So if the drawing gets revised, what was true today is all of a sudden not true. And so truth, when we always talk about the single source of truth, is a moving target, and we've gotta make sure that we're connected in a way that we're always on target.

So it's an argument for the single source of truth, and that being an important piece, but also everyone having access to it. Because if that single source of truth, if anyone has limited access to where the updated drawing is or where the updated change order is or where the updated RFI is, if anyone is missing access, truth to them is no longer truth, right? [00:41:00]

And so what is true to me is not true to you if you have a different view of it, and that instantly causes conflict and trouble and rework, right? And so truth on a project is a moving target, and we all need to be connected to that moving target in a positive way.

Orion Matthews

This is where I guess an interesting question on that. I feel like that runs up against this problem where there's sort of two problems with getting the truth out to everybody. First problem is a tech problem, if your product, your source of truth, is licensing per [00:42:00] seat, all of a sudden you're like, "Okay, I need to get the truth out to procurement," but they only need to get the truth four times a quarter, so it's not worth giving them access, so we'll just send them an Excel file, and now they're part of the truth decay, truth lag because you didn't wanna pay for a seat 'cause seats cost so much.

And then there's also this issue of, like, organizations where you outsource procurement to this other team, and they don't really have network access. So they can't get access to our source of truth. We're gonna email it to them.

So there's like these two structural problems with getting the truth to people. One is product licensing models and fees, and then also organizational security constraints. How do you sort those out?

AJ Waters

That's exactly why you make the statement the truth is [00:43:00] a moving target and everyone needs access to it. What you're explaining are some of the issues that have brought us to this point. Now the solves are a lot of people have gone to unlimited licensing, right? So that unlimited licensing model, some people don't like it, some people prefer the seats. Now your target is a lot harder to track.

It's led to the conversation around digital twin, right? Like, that's what people are trying to get to when they talk about a digital twin. But then you talk about the stakeholders, right? And who gets access and where the system's at, and this is a whole nother topic that we don't probably have time for today, but it's created the data wars, or what I'm calling the data wars, because of data ownership, right?

Because which system is the actual [00:44:00] truth, and who owns it? Does the owner? Does the contractor? Whose system is the actual source of truth, and how are we gonna fight over whose ownership that is? Because at the end of the day, the owner wants all that when the project's over, and they need the actual truth when the project's done.

And so we've gotta play this kind of balance of who's allowed in, who's not allowed in, whose system is it. At the end of the day, how are they connected with one another? Some of the technologies are starting to figure this out. I think IFC was the first thing. BIM went, "All right, we're gonna have a single file type no matter the authoring platform." And IFC kind of was the first thing that headed that direction. Now the platforms are starting to connect themselves a little bit, and I think that's gonna help a lot.

Orion Matthews

My mind's blown. The data wars is a great way to describe [00:45:00] that. And then I think there's even, on that data war, there's another insidious other actor, the tech platforms themselves.

AJ Waters

Yep.

Orion Matthews

Like, okay, they're trying to figure out how to monetize your data. If you're hosting your information somewhere, it's like, are they using it to train their AI models? How much access are they gonna give you to your own data? 'Cause if they give it all, then maybe you just ingest it all and vibe code your own system at this point.

So there's multiple people involved in the data wars. And one of the reasons, if anyone's listening to this and they're like, "I see the data war, but it's been a multi-generational war, a forever war", the thing that's gonna cause this to go into open warfare, in my opinion, is AI.

Because what we're seeing is, as people are like, "Okay, I wanna use MCP, connect my AI models to my information," you're seeing organizations realize [00:46:00] that data strategy and AI strategy are the same. And so trying to figure out, if you're an executive, "How are we gonna leverage AI?", it's like, okay, well, you better win the data wars. Because if you don't win your data war, your AI strategy is bombed. And so because of that, I think executives are starting to realize it, which is gonna, over the next 24 months, create open discussion around this data war situation much more than it has in the past.

AJ Waters

Yeah, and I think that's why it's so important, if you're an owner and a contractor in today's environment, the fact that the platforms themselves are starting to talk to one another so that you don't have to duplicate the data in both persons' system so that you both have ownership of the data, that is going to be vital as we move forward with AI.

You're exactly right. It's just like the people process tech thing. If you don't get the data right first, the AI's just gonna [00:47:00] be faster at being wrong.

Orion Matthews

Yeah. And also, the truth point that you made, when you're like, "Okay, what is true to who?" And it's a moving target, you also have to add another actor in there, which is your AI models.

So like, people are now thinking about FID-ing a project, and this is, for project control teams, this is a nightmare. Because it's like, okay, you send your PowerPoint awesome deck to the executives, "Here's your monthly status of the project, risk, cost, schedule, boom." And it looks beautiful as a PDF. I believe executives today are taking that PDF and also getting an email from their CFO about where the finances are at, maybe last month's, who knows, grabbing that, throwing it into Claude, and then also maybe like some other information, reports from the field. [00:48:00]

Who knows, right? They'll grab a folder of data and throw it all together, and then AI will generate whatever it wants. So it's like the truth has to be curated a little bit. And if you have people just randomly grabbing stuff and throwing it in, it sort of breaks project control's value to the project if they can't get a handle on how people are using AI to have these conversations.

So if you have truth lag, you have duplicate data, you've got Excels floating around everywhere, you don't have a single source of truth, and then you layer AI on top, which is what's happening, I think the executives are gonna start thinking that they have insights that aren't actually true. They're actually getting fragmented, this used-to-be-true-but-it's-not information. And the problem is AI can take all this garbage data and actually make it look amazing.

So it's no longer garbage in, garbage out, where you're like, oh, combine cost and schedule, and you throw in something from finance that's three months old, and it's obviously wrong. You're like, oh, the forecast line doesn't have actuals here. Something like that, AI will just fill in. AI will make it look right. [00:49:00] And that's the insidious trap. It's garbage in, poisonous sugar cookies out that look delicious and will kill you.

AJ Waters

Yeah. The thing is it always looks like an incredible answer, and it's incredibly wrong.

Orion Matthews

Yeah. Oh, man. Okay, last question for you on your list of the 28. The vacation test. Most teams fail it. What is the vacation test, and why do people fail it?

Chapter 09 · ~49:15 – ~52:20

The Vacation Test

AJ Waters

So the vacation test is like a systems question. It tests how well your systems are and really your leadership in general. If you can't walk away and your team operate without you, your systems are broken, and your leadership is not transferable.

And so that's what the vacation test is. If you can't take a week off of work and everything still runs smoothly, then you have a systems problem and a leadership problem. And so it's [00:50:00] both personal and organizational, which is interesting. And that's why I like that test because it points powerfully at two different things.

Orion Matthews

That's a really great one. Like, how would someone do the vacation test, like if you have a standup with your team? You could be like, "AJ's vacation test. Could any one of us leave right now for a week, or would we be screwed?" Is that kind of a nice way to maybe just try out the vacation test?

AJ Waters

It is. Essentially a way to test it would be, pick someone in your weekly standup and say, "All right. This week you don't get to do your normal job," and pick the second person, "You don't get to..." [00:51:00] And swap them, right? You kind of swap it out and make sure that people can operate without. But ideally the best way to test it is to just practice it, to take time off, to renew, to refresh, and to avoid your email.

This is probably another one that I fail at really badly because I'm not very good at avoiding email even when on vacation. I get pretty good at not responding to stuff that's not necessary. But I'm a zero inbox guy, so at the end of every day when the kids have gone to bed and I'm sitting in wherever we're at by myself, I'm clearing [00:52:00] out all the spam and the crap that I don't have to respond to so at least I don't come back to 1,000 emails. I come back to 100, you know? But I'm not very good at this one, but at least the team is operating without me having to make decisions.

Orion Matthews

Yeah. It's a great tip. So as you look at your 28 rules and think about all the conferences you've been to, do you have one takeaway that you would want this audience to leave with today? Some little nugget of information that you'd love for someone to grab onto.

Chapter 10 · ~52:20 – 56:26

Volunteer for Crazy

AJ Waters

So I'll go back to construction's very risk-averse. And you mentioned kind of blame and hiding things being like death sentences to careers. One of the things that I've [00:53:00] noticed or at least experienced is what can be a rocket ship for a career is being willing to take risks.

Volunteering for crazy, right? Like that one project that sounds like it's gonna be a horrible project. It'll be awesome to build, but it's gonna be like a bear. We got a tight schedule, bad budget, logistical nightmare, whatever it might be, and volunteering for that. Or taking something as crazy as your company's gonna overhaul their entire tech system and say, "Hey, that sounds fun. I wanna go do that," right?

Like, what I get most inspired by when I'm at conferences is a lot of times the people who are up on stage sharing a success volunteered to do something crazy or risky or that wasn't a sure thing, and it paid off, right? And so that's one [00:54:00] thing that I'd say I've learned over the course of the years, being willing to do crazy.

And then when crazy fails, going back to being honest about it. Like, most of the stuff that I talk about at conferences, most of the stuff that I write about in blogs are things I've done wrong. They're failures. And here's what we learned, right? So just be okay with saying, I'm talking right now because I just screwed up a lot. I screwed up more often and I was willing to admit what I learned. "Here's what happened. My goal is to hope that you don't have to screw up the same way," and that's why I share it, so you don't have to step on the same landmine that I already blew up on.

Orion Matthews

Awesome. And we're gonna link to all of your awesome content, including your podcast. [00:55:00] Which I can't wait to share with the audience, and to come on it, thank you for the invite.

AJ Waters

Yes, sir.

Orion Matthews

We'll be doing this episode in reverse.

[00:55:50]
Orion Matthews

Wow. We'll include links to your podcast, of course, on the website and down below so anybody listening to this can hit the website button and queue up an episode of TheEngiNerdLife. That sounds great. Yep, just make your project a little bit better every day by listening to an episode. AJ, thanks for joining us, sharing your expertise, offering up your podcast. If the audience wants to find out more about you, is LinkedIn the best way to connect?

AJ Waters

Yep. Yeah, I would reach out on LinkedIn. I'm open to messages all the time. I love to hear from people. I'll respond as fast as I can, so it's usually less than a few days. But yeah, hit me up on LinkedIn, AJ Waters, super simple.

Orion Matthews

AJ, thanks so much for taking the time to join today. Really appreciate it.

Part 2 · The Debrief · the companion episode · 15 min · timestamps below are keyed to the Debrief, not the main episode
Debrief 01 · C · 0:00 – C · 6:15

The Advice Round

[00:00:00]
Orion Matthews

But speaking of students, let's say you're at conferences with the people that are hiring and bringing on these students. So if a student's listening, I think they're thinking a few things. One, AI is eating the entry level positions potentially, industry's shifting a lot. Is it safe to go in? And then also, like, what are people looking for? So maybe you could share a little bit about advice for some students that are thinking about making a career out of this.

AJ Waters

First off, we already kinda hit on it, we need people. So the first thing that I like to say is construction is cool. Go tell all your friends, because we'd love to have you all. And it's purposeful, it's fun, it's ever-changing, it's challenging. [00:00:45] Construction's an awesome industry.

So first off, there's that. For the fear that maybe AI is starting to eat into some of the entry level stuff, one of the things on that rules list, AI is not gonna replace you, but someone who knows how to use it will. Just get good at using it. The prompt engineering is a real thing. Like, asking the right questions of AI means a lot. And so get good at using AI and it will help you immensely as you tackle that entry level stuff.

But really, right now, when it comes to our industry we need the people, and we're willing to work with you, challenge you, give you opportunities, and I couldn't be more excited about the level of opportunity that's out there for a student that wants to come into the construction industry.

Whether you're coming from college in a degree for more of an engineering role, or whether you're coming straight out of high school and you wanna be a superintendent, a foreman, out in the field, [00:01:45] we got room for you either way.

Orion Matthews

What about the techies that wanna get into the data side, want to work at Procore, something like that, that are students in comp sci programs. How do you attract them into the industry?

AJ Waters

Oh, that's a really good question. I think, again, part of that goes back to getting good at AI and understanding AI. And the other part goes to being curious about alternative topics and industries.

Because if you get super laser focused on just the data or the software or the math side of the house when it comes to the algorithms, if you get really focused in on that and you don't see the bigger picture of what you're trying to solve for, get curious about the [00:02:45] industry.

Go to a construction conference. See if you can visit a job site with the engineering department at the school that you're at. Or just read up on the industry at large on things like ENR and Construction Dive and other places, because the context is huge in this industry. I was having a conversation with someone else this morning about how they're thinking about robotics when it comes to certain tasks on the job site, but they're assuming a flat concrete floor has already been installed, and they don't realize that the slab on grade pad inside a building isn't necessarily there when the roof is getting hangers on it.

Sometimes that is last because they're doing in-floor recesses and things like that. The concrete, you're not always gonna have a flat concrete surface. That context is huge [00:03:45] in whatever you're trying to build technologically. And so get curious about the industry.

Orion Matthews

All right. I love that. One other question for the students, and maybe even younger than college students, you were told that you weren't smart enough to be an engineer. You opened up with that. What do you tell that kid now that's struggling with that?

AJ Waters

Oh. For me it was a comparison thing. Someone else had gone off and flunked out that was way smarter than me in high school, and so they were assuming that I was gonna flunk out, too, right? What I would tell you is, you are you. You're not someone else. You're not someone else's experience. You're not someone else's learning abilities. You are you.

You know what you're willing to put in. You know what you're willing to study. You know the effort that [00:04:45] you're willing to give it. And so don't let comparison steal your joy.

Debrief 02 · C · 6:15 – C · 11:15

Books, Podcasts & the Conference Circuit

Orion Matthews

That's great advice. I tend to believe that on the, I'll just add to this point a little bit. I had an interesting track because I actually started in special education, the bottom. And then I also ended up in the honors program. So I've seen both ends, sort of remedial education all the way through the highest level of honors. Because I was sort of not neurotypical or whatever. Long story short, what I learned from that was that there's a lot more about just the crew that you're running with than your own internal capabilities. There are very few people, in my estimation, that aren't smart enough to be an engineer.

I think a lot of times if you feel like you're not smart enough for something, it might just be that you're not put into the right stream [00:05:45] of people, because people move together. And sometimes it's just a matter of saying, yeah, if you hang out with people that are smart enough, you might notice that there's no magic to it. They just have different habits than you, and they believe in themselves.

There was something that said, "Genius is as common as dirt,", which is like everybody is incredibly, exceptionally smart. And I think people say, "Oh, you can't be smart enough for something", I think generally they're wrong. I think anyone can be an engineer.

AJ Waters

Yeah. I love that. I couldn't agree more.

Orion Matthews

So just kind of wrapping up here with some takeaways, what kind of books really spoke to you? Other podcasts? Where obviously TheEngiNerdLife is a great one. Or other people that you follow, associations. Like, what advice do you have for people for some ways to explore more some of these concepts you've learned?

AJ Waters

Yeah. So I have a couple of really great books. I already mentioned Extreme Ownership. That's a pretty good one. My probably favorite book to recommend to people is Leadership and Self-Deception. [00:06:45]

And it has to do with your role in what could be a problem state. And so there are several examples in the book, but the easiest one is like, baby starts crying in the middle of the night. You wake up. Your wife's not getting out of bed yet. And you aren't getting out of bed yet. You're kinda waiting on each other, right? And so you're thinking in your mind, "I've gotta do this tomorrow, I've gotta do that tomorrow. Doesn't she understand? Doesn't she..." You're kinda raising yourself up while putting them down. Like, "Why don't they get this? They don't have as much work to do or whatever." [00:07:45]

Yeah. And so you're deceiving yourself about how good of a person you are and how terrible the other person is, and now you're blaming them for not... Whereas if you would've just gotten up at the sound of the cry, it would've been over already, right? And so that's just one small example from the book, but it's an incredible book about how problems really start based on your actions, not someone else's.

Orion Matthews

And then any podcasts that you follow or associations that you really think are pretty awesome? And conferences too, since you're the man.

AJ Waters

Well, there's a lot of those. So I came up on Construction Brothers, so Eddie and Tyler Campbell, still one of my all-time favorites. The ConTechCrew was one that I kinda grew up with as well. There are so many podcasts out there, it's really not [00:08:45] hard. But there's this one called the Megaprojects Podcast. I would really recommend that one. It's super good. The host is a lot of fun, and does a great, great job with it.

And then as far as conferences and associations, I've been a part of a lot of them. ASPE as an estimator, CMAA, CURT. There are tons of great ones, DBIA. It kinda depends on what your role is in construction and what makes sense. I would kinda ask around your peer group. See what they're up to and who they're listening to. But don't just use that, also do a little bit of searching so that you can expand. Be curious about the rest of the industry.

And then when it comes to conferences, there are so many to name, but a lot of those associations have their own conferences. DBIA's got multiple, CURT, CMAA's got multiple. Yeah. AACE. [00:09:45] There are so many different conferences out there.

My favorite two, the one that happens yearly that I really love is Western Winter Workshop. It's more networking than conference, which is why I like it. And then the one that happens every three years is ConExpo, and it's like the world on steroids for construction. 100,000 people descend on Las Vegas. It only happens every three years. It can be overwhelming, but if you have the week to spend there, man, can you see some cool stuff, learn some neat things, and meet some great people.

Debrief 03 · C · 11:15 – C · 14:52

How TheEngiNerdLife Happened

Orion Matthews

Thanks for those recommendations. And then I just wanted to add one little note on that book you mentioned, it reminded me of another book, The Courage To Be Disliked. [00:10:45] Which is on Adlerian psychology, an offshoot of Freud. Anyway, The Courage To Be Disliked is an interesting psychology book, but it talks about how people tend to change the way they perceive things to achieve whatever their goals are, basically. And so it's kind of like lying to yourself, and that's just another way to go down that rabbit hole as well.

Tell us about your podcast. Why did you start it?

AJ Waters

Oh, good question. So a couple of years ago, I started a blog. It's been a little over a year and a half now. And the reason I started the blog, I wrote an article for the company that I worked for, and marketing loved it, and then put it on a shelf. And it sat on the shelf for like nine months, and I was like, "But it's so... Like, I wanna say this to people." So I finally came to the conclusion over a Christmas [00:11:45] holiday that I was just gonna publish it myself, which means I needed a place to put it, which led to a blog. And so I asked if I could have it back, if I could publish it myself, and they were totally fine with that, so I started the blog.

And after a year of talking at people, I was like, "I don't like this. I don't wanna just talk at people. I wanna talk with people. I wanna share stories with people. I wanna learn from people." And that's what led to the podcast. And so this year, it transitioned from the blog that it was last year to a podcast.

We're recording this in August, so I'm eight months in to having it as a podcast, and it's been a lot of fun. I've learned a ton. I'm meeting great new people. And the whole point of the show, the purpose of the show is to talk about someone who has a unique gift when it comes to construction.

Whether that be reading contracts, whether it be understanding [00:12:45] data, whether it be developing technology. And to walk through the journey, like how they found that gift, but at the end, kind of the twist is this isn't a superpower or a unique ability like invisibility or super strength that only one person can have.

Orion Matthews

Yeah.

AJ Waters

This is a practical thing that you could go implement tomorrow to make your project better. And so every episode ends with some practical takeaways that should help the individual make their next project a little bit better. So that's the goal.