Digital transformation, or digitalisation, as described by the European Commission, is characterised by a fusion of advanced technologies and the integration of physical and digital systems. A recent index devised by McKinsey & Company ranked the construction industry as one of the least digitalised industries, above only agriculture and hunting. However, the industry is now entering the digital age. In the coming years, construction companies will need to develop real digital strategies, with many players having already created ‘innovation labs’ and having launched ‘proof of concept’ (POC) explorations. Such explorations are often run through local business unit initiatives to test possible options and to remain open to possibilities without investing too heavily. Moreover, a plethora of challenges faced by the construction industry due to the COVID-19 pandemic have made a major contribution to the industry’s shift towards favouring digital ways of working. It is essential that those in the sector adopt new technologies at least at the market speed, or they will see themselves get left behind.
In early 2020, global market intelligence firm, IDC, partnered with AutoDesk to survey 835 construction professionals from large construction companies in countries across Europe, the Americas and Asia Pacific. The survey found that digital transformation is a priority for 72% of construction firms worldwide, with the urgency being most prominent in Europe, where 82% of firms are treating digital transformation as critical. Despite companies’ recognition of the importance of investing in digitalisation, the survey found that 32% of firms spend less than 3% of total turnover on digital technologies. Figure 1 below shows a breakdown by region of the main results of the survey, where ‘digital transformation’ is referred to as ‘DX’.
Figure 1: Bar chart showing Autodesk-IDC digitalisation survey results by region. Autodesk
Digitalisation, however, is a rather broad term and often companies under-going a period of digital transformation must consider how they can best make use of specific technologies to fit their industry. Building Information Modelling (BIM) is a process that incorporates digital representations of buildings into 3D models to facilitate better collaboration among all stakeholders on a project. This can lead to better design and construction of buildings and is particularly useful in aiding remote working on project designs. Changes to the BIM model occur in real time so any changes or updates to the model can be instantly communicated to all team members when they access the model. Moreover, every member of the process is always working with the most up-to-date information. According to the Autodesk-IDC survey, 41% of firms worldwide are currently investing in BIM-based workflows, while 30% plan to invest in BIM in the near-term. Brazilian construction companies are leading in this respect, with 53% already having invested in BIM software.
Naturally, since BIM allows team members to work in a virtual environment when planning projects, pairing BIM with Virtual Reality (VR) technologies has the potential to create more successful outcomes. These include allowing construction companies to spot and fix problems before they can occur, allowing for better training and safety, and reducing the number of onsite visits required. The use of VR technologies will also allow clients to experience an authentic, life-like tour of a construction project as opposed to having to look at hand-drawn or even computer-generated plans, thus improving the experience for clients from start to finish.
In addition, construction companies might be wise to consider establishing an enhanced online presence using social media platforms as opposed to merely investing in technologies that have a more direct benefit on construction projects. Having an active social media presence allows construction companies to proactively share their work ostensibly for free, and with an ever-increasing amount of social media users, a company’s outreach can expand much faster through the implementation of social media platforms. Moreover, an online presence and engagement with followers would make it much easier for companies to recruit new employees.
There seems to be no detriment to construction companies synergising with digital initiatives, given they would most likely reap a wealth of benefits should they choose to invest. However, the aforementioned statistics do show that many firms are investing very little in potential opportunities in digitalisation and hence are continuing to fall behind in a world where businesses are continuously using technology to position themselves advantageously in their respective sectors. The first construction companies we begin to see undergoing a more drastic digital transformation will perhaps make or break how digitalisation is perceived within the construction industry. Above all else, the market will be keen to see the implementation of new technology, and where digitalisation of the construction industry will take these technologies.
By Daniel Gaskin
Sector Head: Theo Thomas