A tech revolution is sweeping the construction industry, and it’s boosting the economy
- Written by Rob Bryant, Executive Vice President APAC, InEight
A wave of technological innovation is sweeping the construction industry, with firms adopting digitisation in a bid for efficiency, profitability and differentiation. Companies that don’t adopt a pathway to digital transformation risk being left behind as the industry moves into the next phase of its lifecycle.
There’s good reason for the industry operators to adopt new technologies. A recent McKinsey study found the construction industry has recorded the lowest productivity gains and profit margins of any industry in the last two decades.
Worse, approximately 90 per cent of capital projects experience some form of cost or schedule overrun. This is borne out by a study from The Grattan Institute, which found the Australian government had spent $A34 billion on transport projects completed since 2001, a blowout in costs of more than 21 per cent. Project control solutions that help manage the complete lifecycle of capital assets are fundamental to realising improvement.
On top of that, Australia is undergoing an unprecedented infrastructure boom. Economists report that the major project pipeline is sitting at around $A400 billion over the next five years, boosting the economic outlook – as long as the industry can get a handle on productivity, cost overruns and efficiency through digitisation.
Document the revolution
There are any number of reasons for cost overruns. They can include working with multiple contractors and suppliers, as well as supply-chain disruptions and even local politics and bureaucracy. Large projects also require coordination across multiple firms and specialists, all of which create an environment where projects can become disjointed and disconnected, impacting profits, costs and worker productivity.
This is where digital project management comes into its own. It allows for the complete centralisation of project data and information, regardless of how many stakeholders and workers are involved. Centralised information gives project managers a birds-eye view of the project from planning and ground-breaking all the way through to completion.
The collection and digitisation of project data also provides the opportunity for project managers to use data analytics tools, such as artificial intelligence and machine learning, to better predict future productivity and identify potential pain points before they arise.
It’s a lack of actionable data during pre-construction and construction phases that contributes to cost overruns. This is backed up by the report from The Grattan Institute, which recommends that cost blow-outs be addressed through the collation of detailed project data.
The benefits of clear and well-managed documentation can’t be understated. Large capital projects are under a high degree of public and political scrutiny, making it absolutely essential that project managers keep clear and accurate records to ensure they are acting within regulation and contract at all stages of the project.
Centralised, digitised document control is the solution every asset owner and construction company must have if they’re going to maintain productivity and efficiency – as well as get the job done on budget and on schedule. And document control in this context also means contract correspondence, requests for information and critically, variation requests. An audit trail of who sent what, when and to who can save time and millions of dollars on a large-scale project.
BIM comes into its own
Digitisation isn’t limited to document control . Building information modelling (BIM) creates 3D models of the entire project, and by adding multiple perspectives through BIM modelling, managers have the complete picture allowing them to make informed decisions.
These models are known as a “digital twin” of the project, and they enable project managers to create a digital replica of the project, viewable in three dimensions, even before ground is broken. This form of real-time data enables managers to run simulations to test hypothetical scenarios and predict the outcome of those scenarios before injecting real money into a new project.
A fourth dimension – time – can also be added, creating a 4D model, which allows managers to see the project through its various stages as the construction timeline progresses. Barriers and impediments are then predictable, and plans made to overcome them – all before they impact the work schedule and the overall costs and profitability of the project.
Digital twinning can also extend beyond the construction phase of the project and into its post-construction real-world use. This gives planning departments, governments and tenants insight into how the building functions in the real world, and whether it lives up to its promises.
BIM and digitising documentation are only two ways, out of many, that the industry is being transformed. By using these technologies, capital projects can avoid cost blowouts and changes to schedule, bringing buildings in on budget and on time, and therefore benefiting the economy as a whole.
For the construction and engineering industry, the revolution is here.
