Building a better construction industry.

The construction industry, practical by its very nature, has been slow to embrace digital technologies. But the need to provide housing for global urban population that is growing by around 200,000 per day means there is incentive for the construction industry to embrace cloud, mobile connectivity, big data and smartphones, to become more efficient and better at managing risk.

According to the Global Construction 2030 report, the volume of construction output will grow by a gargantuan 85 percent to $15.5 trillion worldwide by 2030, driven by developed countries recovering from economic instability and emerging countries continuing to industrialize. Digital transformation, however, is central to the sector’s success going forward, according to the Institute of Civil Engineers (ICE).

In ICE’s State of the Nation 2017 report, the group has called on the UK government to put advances in technology and data processing at the very epicenter of its industrial strategy to design and deliver the infrastructures we all rely on. ICE has also called for a change in ‘industry behaviors’ to ensure people have the right skills to advance technology and information management, with large infrastructure projects acting as hot houses for innovation.

But the sector still has much to do. In a recent McKinsey & Company report 64 percent of Europe and Middle East constructions firms were rated as either “industry following” or “behind the curve” in their use of digital technology, putting digital transformation some way off.  

Development for success

The construction industry is made up of a diverse supply chain and projects are becoming increasingly complex and larger in scale. McKinsey analysis shows that large projects typically take 20 percent longer to finish and are up to 80 percent over budget.  “There are deep issues that can only be overcome with new ways of working and thinking,” according to Mukund Sridhar partner at McKinsey.  The Boston Consulting Group has shown that digital technologies have the capacity to reduce cost and schedule over runs by at least 15 percent.

Construction project management software is helping communication and collaboration between customers, managers and teams as well as overseeing complex supply chains, providing automated calculations and predictions together with electronic administration such as payment and invoice generation, for example. Applications can assign work tasks to teams and flag up any problems so everyone from architects to developers to builders and contractors are kept in the loop, improving efficiencies and ensuring accountability.  Mobile platform compatibility and cloud means everyone increasingly has access to this information on the move and onsite.

Another key element is Building Information Modeling (BIM), replacing old fashioned blueprints with interactive 3D models, to which schedules and costing can be attached.  BIM and project management software provide real-time collaboration using cloud technology. At its core BIM uses 3D models and a common data environment to access and share information effectively across the supply chain.  At the design stage, it enables designers and stakeholders to work on and test designs. During construction in allows engineers, contractors and suppliers to integrate complex components, reducing time and waste. Finally, during operations it tracks services and provides data on tracked assets.

Countries are already recognizing the opportunities BIM offers. In the UK, the government has made BIM Level 2 a necessity for companies bidding on centrally procured public projects. The UK government is giving its full support for BIM Level 3, which will eventually provide a full collaboration environment for all disciplines via a single, shared project model holding centralized data for the entire lifecycle of the building, from planning and construction through to facilities management.

Smart construction

The Internet of Things (IoT) is also starting to streamline the construction industry - making it more efficient.  Sensors installed on construction equipment can provide analytics data for tracking and optimizing equipment.  Radio-frequency identification (RFID) technology is increasingly being used for smarter logistics and inventory reporting.

Heavy machinery manufacturer Caterpillar, for example, is planning to use Cat Connect Services suite of technologies enabled with telematics to provide detailed analytics of when, where and how hard its machines are working. Caterpillar also plans to use this data to help it design machines for specific applications such as landfill projects.

Drones and other unmanned aerial vehicles (UAVs) are dramatically improving the coverage and image quality of HD photography and 3D laser scanning on worksites, providing views of buildings and potential development sites that were impossible or expensive to obtain in the past. With the right analytics tools, construction companies can use this data to create 3D structural models, topographical maps, run site safety inspections and work out volumetric measurements of building materials such as sand and cement, for example.

3D printing of materials has also allowed for the delivery of pre-assembled modules to sites, reducing both time and cost. The WASP (World’s Advanced Saving Project) is has developed BigDelta, an enormous 3D printer that has been developed to print affordable, sustainable homes made from natural products such as clay.

Times are changing

We are a long way off the largely human free construction site that infrastructure giant Balfour Beatty is predicting for 2050. In just over 30 years’ time Balfour maintains that construction work will move off-site, machinery will be controlled remotely and new materials and approaches will rationalize processes and drive cost and safety.

For now, however, the construction industry must concentrate on being more agile to meet demand. The McKinsey Global Institute estimates that the world will need to spend $57 trillion on its infrastructure by 2030 to keep up with global GDP growth.  This in itself is an enormous incentive for construction companies to start to move quickly to harness the power of digital transformation.

New digital business models will impact the construction industry. Find out more here about how digital technologies can help construction companies streamline their processes and achieve more value here.