While other sectors of the economy have seen significant gains in productivity over the last few decades, construction productivity has remained stubbornly low and flat. Poor productivity doesn’t just eat into contractor margins, it increases material waste, increases project cost, and reduces our ability to deliver maximum value to our built environment. The root-causes of the industry’s productivity challenge have been well documented – ranging from the manner in which projects are procured, to the fragmented nature of the industry, to limited investment capital with which to effect change. Solving such challenges has proven an intractable problem. But the question of productivity isn’t just limited to delivery. With global infrastructure facing an annual financing gap of $1Tn, and increasing expectations that private sector monies will be needed to help bridge that gap, productivity of the assets the industry creates and maintains is being put under scrutiny by potential investors – did that toll road deliver the projected returns, or were maintenance costs more onerous than planned?
With global demand for construction output forecast to increase to $17.5 trillion by 2030, scaling poor productivity either in delivery, or in asset performance, simply isn’t an option if we’re to avoid compromising our built environment. Could technology offer ways to improve productivity in how projects are selected, funded, and delivered? Here are four trends to track:
1. From big data come big outcomes
According to McKinsey & Co, in 2007, half of global GDP came from 380 cities in developed regions, but by 2025, 136 new cities are expected to enter the top 600 cities, all from the developing world. Construction is changing. It is increasingly being reshaped by the need to build in the context of complex urban environments, and by a shift in the centre of gravity of output to emerging nations. Confirming which assets to build to achieve a desired outcome, and which projects to bid on to ensure profitable growth will increasingly rely on finding answers in data. Trends in population demographics, economic growth, disposable income and more will be crunched by cloud-based systems to help answer those questions.
That need is driving the creation of new tools capable of modelling building and infrastructure information at the macro scale, enabling contractors to help their clients make quick but accurate decisions across multiple contexts – financial, environmental and social – to select the right built asset solution to achieve a desired outcome. More fundamentally, such tools are likely to accelerate the shift in how the industry thinks about the built environment, from today’s focus on discrete projects, to tomorrow’s focus on a system-of-systems approach in determining what we need to build, where and why (or even whether we need to build at all). Such big-data tools are going to become instrumental in driving industry workloads - whether contractors position themselves as ‘trusted advisors’, engaged in long-term relationships with clients, helping them make better built asset decisions, or just seeking to use such tools to identify the best pipeline opportunities.
2. Digitally-driven capital with which to build
Construction needs capital to build. Improving the productivity of capital deployed into our built environment is going to be key to ensuring sufficient funds flow into the industry at a pace that matches aspiration for building. Technology could unlock capital in three new ways:
- Match-making on risk: Understanding the risk profile of projects is something that big data and predictive analytics can improve, enabling investors to understand a project’s risk profile before committing funding. ‘Closing the loop’ on how existing assets are utilised, via the Internet of Things (IoT), should enable not just a better understanding of how future assets are likely to perform, but improved return on capital through incremental learning.
- Determining remaining value: The world’s total built asset wealth is estimated to be $218Tn. Unlocking capital by selling assets then investing the proceeds in new projects is a common practice. But the productivity of the capital tied up in that asset is dependent on accurately determining how much value remains in an asset. Predictive analytics, remote-sensing, and IoT feedback should help to better quantify that value to maximise the level of capital released (and the liability being taken on). For example, interrogating maintenance patterns for a road system and future forecast vehicle movements might more accurately determine the likely cost of maintaining that road.
- Crowd-funding: Crowd-funding is already being used to raise capital in manufacturing, entertainment, and many other areas, but in the built environment, it could be used as a way to raise finance for private-sector real estate development and public-sector social infrastructure project
3. Productive delivery – from today’s prefabrication to tomorrow’s digital fabrication
The links between prefabrication and enhanced productivity in construction are well documented – adopting manufacturing style practices, in a controlled environment, with enhanced safety, quality, cost and schedule performance are attractive traits. Though prefabrication isn’t new, digital technology is making it more accessible and flexible. Advanced modelling technology is enabling contractors to work both from the bottom-up to use standardised elements for buildings and infrastructure, and from the top-down to split an inherited design into elements that might be prefabricated offsite, then assembled onsite.
Once the preserve of relatively modest assets, prefabrication is now scalable, and has the potential to help the industry achieve a high degree of standardisation – a cornerstone in unlocking manufacturing-style productivity levels. Buildings could be manufactured in low-cost execution centres, then shipped around the world for final assembly, providing significant implications for the competitive landscape in construction.
But standardisation isn’t appropriate for every project, or every component. The new industrial revolution in manufacturing is rewriting the process of going from a great design for an item to a finished real-world artefact. At the vanguard of this revolution is digital fabrication, and in particular, 3D printing. Today, it is possible to go directly from a 3D model of an item to a finished real-world object in a single touch, with a single machine, without having to retool, in over 80 different types of material – steel, glass, ceramic, polymer, concrete and more.
This is transforming the modern manufacturing paradigm that has been with us for over a hundred years – to date, it’s been cheaper to buy a standard off-the-shelf component then have a bespoke item made, because ‘complexity and uniqueness’ have been expensive traits in manufacturing. With 3D printing, ‘complexity and uniqueness’ are essentially free. Freed from the constraints of building standard components, contractors can focus on the ideal solutions for projects, and then deliver those solutions with minimal waste.
4. Productive operatives
From autonomous drones, to wearables, to construction robots, the growing technology category of ‘jobsite automation’ holds the promise of allowing individual operatives to not just do more with less, but do things in a smarter, safer and less physically demanding way. Drones and robotics offer the potential to significantly change the way we understand construction sites, and how we physically build.
Today, drones, even when used in their most basic capacity, help mitigate the risks associated with working at height when surveying tall structures. When coupled with reality capture software, they enable the physical world to be brought into a digital environment en masse – supporting more productive progress capture, inventorying of sites, and other tasks, like machine control, at a marginal cost. But as drone technology continues to evolve they will open further opportunities – for example, MUPPette, is a 3D printing drone that uses GPS sensors and a laser to guide itself. While it’s still in piloting stages, the aim is to use it to 3D-print large objects.
Robots have traditionally been restricted to performing repetitive tasks, operating in controlled, factory environments. The productivity boost they deliver has come from reducing the unit time and cost for producing standard ‘things’. Construction sites are typically anything but controlled environments, and rarely are any two projects identical. But robots are changing. The rise of machine learning powered by the cloud, and the increasing array of sensors with which they might be equipped, holds the potential for robots to be able to deliver the same type of productivity boost they’ve traditionally delivered to manufacturing, to construction by being adaptive and responsive enough to cope with the nuances of construction sites.
What does this mean for the future construction operative? It’s likely their role will change. Rather than doing the traditionally physically demanding tasks associated with construction, they’ll be partnering with machines, curating them, selecting which to deploy, and wielding them in the same manner they’ve done with traditional construction tools – but with far greater impact.
How we build – from identifying the right projects, to unlocking funding, to physical delivery – is being disrupted by technology. Those disruptions are creating opportunities for individual companies to side-step the traditional barriers to improving productivity that have impeded industry progress, and restricted the ability of any one firm to ‘shape their own destiny’.
Organisations who can get ahead of the curve and unlock these capabilities, to drive efficiencies in what they do now, innovate what they can deliver in the future and unlock new funding opportunities for their clients will be well placed to succeed in the coming years. Failing to address these shifts could leave many facing further future challenges, without the tools to adapt.
For more information, see Autodesk’s “Constructing with the Power of Digital” manifesto.
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