Optimising Construction with Digital Transformation
The past few months have disrupted our established and customary ways of thinking, working and socialising. It has been a wakeup call that is forcing us to reckon with our social and economic foundations. It has tested the flexibility of our workflows, the transparency of our practices and the maturity of our technological capabilities. Industries that have adopted technology driven processes have been able to recover sooner and ensure business continuity and customer satisfaction.
However, onsite demands, in-built uncertainties and inherent risks have slowed the construction sector’s full-fledged digital transformation (DX). But the good news is that construction companies have begun taking DX seriously. With a recent IDC study finding that 72% of construction companies worldwide are prioritising DX, and believe that it is the key to improving their processes, business models and ecosystems.
The same report shows that 60% of construction companies are only just starting their DX journeys. While this indicates that construction companies have begun to comprehend the value of DX, it also highlights the need to adopt and integrate DX in a more holistic way. Apart from helping us deal with the sector’s legacy challenges like risk management, worker safety and budget/schedule overruns, it will also help us meet the requirements of a post-COVID world.
From business model innovation and knowledge collaboration to optimisation and resource management, DX has the potential to help an organisation evolve into a Digital Native Enterprise (DNE) that supports innovation and digital disruption. Especially in a post COVID-19 world, there will be a continual requirement for companies to invest in Artificial Intelligence (AI), wearable technologies and Analytics to ensure safety standards and maintain social distancing, while promoting productivity and efficiency.
Identifying and addressing challenges
To forge into a truly DNE enterprise, construction companies need to identify and address their challenges and construction-specific roadblocks. Traditionally the construction sector has grappled with 2 main challenges:
Risk management
Effectively managing risks is a major concern for construction companies across the world. The sector’s risks range from quality and design risks to scheduling and finance risks. And our ability to address these risks determines our productivity, efficiency and cost-effectiveness.
Given the advances in emerging technologies, generative design, additive manufacturing and integrated BIM workflows, we now have the resources to manage our risks, drive innovation and promote sustainable practices. From using AI to anticipate and analyse on-site risks to leveraging analytics to determine the most conducive time and environment for work, technology can help us complete projects on time, reduce wastage and optimise resource utilisation.
Worker safety
Construction workers are often at the mercy of weather, terrain and site safety. This makes it imperative for construction companies to ensure safety practices, provide protective gear and monitor violations. This is especially crucial as we continue to fight the Coronavirus pandemic. Occupational hazards aside, we also need to maintain social distancing, monitor workers’ vitals and curb the spread of the virus on site.
By effectively using AI, Big Data, and IoT, we can reduce safety risks to a large extent. AI algorithms can be applied to site images captured by drones to identify safety hazards and social distancing violations. And wearables can help monitor workers’ vitals and safety levels. Given these resources we can address the sector’s legacy concerns, while enforcing the COVID related requirements as well.
DX done right
An organization can’t evolve into a DNE by adopting new technologies and enhancing existing ones. DX needs to be built into every pillar of the organization. IDC’s study on digital transformation shows that DX entails transforming an organization’s:
- Leadership: Agile planning and governance combined with awareness and business model innovation.
- Omni-channel experience: Integrated physical and digital workflows, processes and policies.
- Information/ Data management: Identifying data and deriving valuable insights to make data driven decisions.
- Operating model: Connected assets, products and processes.
- Workforce:Optimise talent utilisation and facilitate a digital transformation mindset.
The key to connected construction
The construction industry is a key stakeholder in a country’s economy, especially in Australia and New Zealand. With Australia’s construction sector making up 8% of the country’s GDP and employing 1.1 million people, while in New Zealand the sector is expected to grow by 20% by 2022. So, investing in the construction sector means investing the country as a whole. And DX is key to the future of the construction ecosystem.
The groundbreaking results of DX have already been realized by many other sectors. With a recent McKinsey Global Institute report finding that DX could result in 14-15% increase in productivity and 4-6% decrease in cost. So, as the industry kicks back to life after the lockdown due to the Coronavirus pandemic, the time is right for change, innovation and transformation.
Resources:
- IDC study
- https://www.mckinsey.com/industries/capital-projects-and-infrastructure/our-insights/decoding-digital-transformation-in-construction#