What does the construction market look like for 2020? The answer to that question may depend on where you get your data.
If Deloitte is your go-to, 2020 should see an upbeat trend in engineering and construction. The firm expects anticipated transportation, infrastructure, and smart city projects to drive growth in the year ahead.
On the other hand, if you look to Dodge for market futures, 2020 presents a less than rosy picture. Their 2020 Construction Outlook expects a 4 percent decline in total U.S. construction starts from 2019’s level of activity.
Regardless of who you follow, the majority of E&C firms still experience low profitability and margins. Increasing project complexity, declining productivity, and supply chain challenges are just a few of the roadblocks that are driving companies to consider how a digital construction solution can help. As the new year unfolds, it may be time to step out of your comfort zone and take a closer look at new ways of doing business.
Finding an edge
With tight project budgets, rising costs, labor shortages, and other points of contention, everyone is on the lookout for ways to win more jobs while increasing profitability and competitiveness. The construction industry has lagged behind other markets in the use of new technologies, but these challenges are now causing many to consider digital construction processes and methods that have proven successful elsewhere.
Digital construction technologies offer great potential for addressing the problems faced by E&C firms. From surveying and inspection drones to monitoring devices to fully-digitized job sites, companies are exploring the ways technology can help them succeed in a highly competitive environment.
Digitization of projects is rapidly gaining industry acceptance as companies explore the potential benefits. For example, while current construction costs are estimated to be 30 percent higher than they should be, digital construction management has been proven to reduce this waste by lessening re-work and scheduling delays through 4D/5D planning, real-time as-builts, and clash detection.
Stages of digitization in construction
The basis for digitization is the use of 3D Building Information Modeling (BIM). Using digital twins created with BIM, designers and engineers can virtually build a project from start to finish in the safety of a no-risk digital environment, while acquiring embedded data that will constitute a single source of information for the project.
4D BIM adds critical time and scheduling data to the mix. With 4D capability, firms are able to improve coordination and avoid scheduling clashes by comparing what was planned to what is actually happening. Adding 5D BIM integrates estimating and costing.
Digital construction management has been shown to deliver better project outcomes by improving predictability, transparency, and accountability. Improvement in those factors, along with safety and efficiency, leads to more accurate work, less re-work, cost savings, and on-time delivery. All of which drive improvements in project performance, value, and results.
Navigating digital transformation
While many asset owners are realizing the value of digital construction, the digital skills gap and general lack of awareness among E&C firms continues to be a stumbling block to wide scale adoption.
In response, many firms are exploring relationships with leading digital integrators to guide their efforts and address their lack of in-house IT capabilities. Digital integrators help firms discover the right mix of people, processes, and systems for their situation, and lead them to the best possible ROI.
At this early stage of the digital construction management revolution, not everyone is taking full advantage of the possibilities offered. However, those who start making the move to digital sooner rather than later will likely emerge as industry leaders.
Need help integrating digital into your competitive strategy? Contact us to discover how we can help.