Phil Brown, chief executive of Causeway Technologies, looks at how technology is being embraced across the supply chain to accelerate the digital transformation of the construction industry
Construction isn’t always the first sector that comes to mind when you think about innovation and business transformation. In fact, it is often presented as a laggard, mired in complexity and challenge. It has deep-rooted issues preventing real change – including the contract model and low margins.
In fact, the industry is systemically wired for risk to be passed on to the contractor – who in turn passes as much as possible on to the supply chain. This, together with the temporary ‘project-based’ relationship model, means there’s little collaborative innovation going on. It’s very difficult for digital technology to disrupt the construction industry as it has done in other industries, while this fragmented approach to the project lifecycle still exists.
Yet, I am witnessing real desire in the boardroom to embrace technology. Whether it be the board of a large tier one contractor or the owner or manager of a subcontractor, many are aware that digitisation will be necessary to survive and that those who adopt early will be the winners.
Technology investment has, until recently, been heavily focused on back-office operations. However, what we’re now witnessing is a shift to invest in front office and field operations, where the commercial risk may be higher, but where the results are defining success. It’s here where relationships with customers and supply chains exist – where they assess risk and make the operational and commercial decisions that determine their success. This is where Construction’s Digital Frontline delivers – real change, and it’s happening now.
At Causeway, we set out to shine a light on this real change. An in-depth piece of research, complemented with interviews with leading industry influencers such as Birmingham City University, Atkins and Eiffage Kier joint venture, has formed the basis of our new report: Construction’s Digital Frontline.
The benefits outweigh the investment
Our research spoke to 200 UK decision-makers in construction from design and pre-construction through to operations, supply chain management and project management. We found uncertainty remains, with 54% admitting the industry has been slow to adopt digital technologies, but for those who are leading the way and have taken the risk, the benefits outweigh the investment.
Many other forward acting businesses are going beyond traditional back-office systems to harness digital technologies at the frontline. In today’s mobile and the digitally-enabled world, success will increasingly be found. And as a result, many businesses are transforming their commercial performance by reducing operating costs, managing risk, enhancing supplier relationships increasing productivity and boosting service delivery.
What rings true within our report is that 2020 is sets to be a pivotal year as more and more businesses will be taking greater leaps to improve their business digitally. Whether that be in operational changes, improving their information flows, tightening their supplier relationships or recruiting the right talent for the future. I think, as an industry, construction is making moves in the right direction and is set to reap the benefits.
Challenges do remain
What we have found points to a number of key drivers that need to be addressed if the industry is to take full advantage of the opportunities of digital technology. The key themes that emerged through the research were integrating technology across the supply chain, developing a new and diverse digitally-driven workforce and improving profitability to enable increased investment in new technology. To empower decision-making at the frontline, there is a clear need for intuitive, easy to use and deploy, cloud-enabled mobile tech where data is readily shared and available.
Developing a new and diverse digitally-driven workforce is a critical industry-wide issue that businesses are faced with and by working together to ensure digital can thrive within construction, we are on the right path to attract the right talent.
It’s an exciting time in construction with momentum building, yet there remain challenges. Construction’s Digital Frontline will continue to investigate where there are opportunities for growth. Whether that be fully embracing BIM, uplifting the skills pool within the industry or support from government bodies to invest in technology.
The report, Construction’s Digital Frontline, is available to read in full here.
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