Construction contractors worldwide are lagging in efforts to digitally transform their operations, the latest report has found.
Releasing the results of its survey of 835 construction firms across twelve countries conducted by IDC, design and construction technology provider Autodesk said that of those surveyed:
- Only 13 percent are well on their way to digitising their operations.
- Almost six in ten (58 percent) remain in early stages of digital maturity.
- Whilst 98 percent use digital construction solutions in some form (BIM workflows, bid management, project management and insights etc.), less than half (49 percent) deploy these solutions on 20 percent or more of their projects.
- Only three percent use digital construction solutions on half of their projects or more.
Nevertheless, the report indicates that embracing digital technology is an area of focus.
All up, 72 percent of companies surveyed said digital transformation was a priority for them whilst 69 percent had a specific person in charge of spearheading digital transformation.
According to the report, the digital maturity of organisations in construction can be grouped into five categories.
First, there are ‘ad-hoc’ companies who make little effort to transform their operations and use digital technologies only to counter competitive threats.
All up, 34 percent of companies surveyed fell into this category.
Next, a further 24 percent are digital explorers. Whilst these companies recognise potential uses for digital technologies, they deploy them on an ad-hoc or individual project basis only and have not adopted use of these technologies in a repeatable way across their projects.
The third category involves ‘repeatable’ organisations who recognise the value of enterprise wide digital technology adoption and have created repeatable adoption of these across projects but have not yet fully embraced the disruptive potential of digital initiatives.
All up, 28 percent of organisations fit into this category
Last, 11 percent and 2 percent of companies are digital transformers and digital disruptors. These are deploying digital products in an integrated way to transform operations and customer experiences. Further, those who are disruptors have used digital technology to drive entire new business models and have an ecosystem awareness through which feedback is a constant input to business innovation.
According to the report, challenges and opportunities in regard to digital construction vary across countries.
In Australia and New Zealand (ANZ), for example, adoption of 3-d printing and drones is gathering momentum whilst technologies such as wearables, autonomous trucks and AR/VR are likely to be deployed more widely over the next five to ten years.
When it comes to BIM, however, adoption is lagging. All up, the survey found that only 16 percent of ANZ companies regularly used BIM on their projects – the lowest proportion across the twelve countries surveyed.
Things may be changing. New Zealand has established the BIM Acceleration Committee of government, building industry and technology industry representatives to accelerate the deployment of BIM.
In these countries, companies surveyed indicated that challenges to embracing digital transformation involve data security and the effective management of risk. In response, companies are investing in solutions relating to customer relationship management (CRM), enterprise resource management (ERP) and BIM based workflows along with technologies to improve predictive maintenance and analytics.
In Singapore, strong take-up of digital technology is being driven by government leadership. BIM use is mandated and a major government body known as the Building and Construction Authority (BCA) has high expectations for deployment of digital technologies across projects.
Through its Building Innovation Panel, BCA is assessing how innovation in sustainable building materials, green technology, automation and 3D printing can drive better industry outcomes.
To support government expectations, workers are provided with training and support with regard to digital technology.
As with Australia, data security and risk management are challenges identified in digital technology take-up. Planned areas of investment include CRM, take-off solutions and estimating. Technologies being used to improve operations include robotic process automation software, AR/VR and the Internet of Things.
In the developing countries such as India, however, the situation is different. Whilst BIM is used by 47 percent of companies, its adoption is restricted mainly to work performed for international clients and on larger-scale projects such as Bangalore Airport and the Delhi Metro Rail.
Whilst the government does see the need for technology in construction in response to increasing urbanisation and growing housing demand, greater government leadership was needed in order for BIM adoption to become more widespread.
When it comes to India, critical construction challenges include delivering projects on time/on-budget and ensuring workplace safety. In many cases, companies have made investments in ERP and project scheduling and are looking for greater investment in these areas.
Asked about how companies can transition their operations, Daniel-Zoe Jimenez, AVP and APAC Head of Digital Transformation at IDC, says action is needed in four areas.
First, Jimenez encourages companies to benchmark and assess their current level of digital maturity. This, he says, will help organisations to understand where they are in digitisation, how their progress compares to industry peers and any gaps which they are facing.
Next, companies need to develop a holistic digital strategy which is both integrated throughout the organisation and supported by performance metrics.
As things stand, Jimenez says many digital efforts are siloed and led by different business units. In digitally mature companies, efforts are more united and coordinated throughout the organisation.
On metrics, he encourages companies to develop a balanced scorecard which blends traditional measurements such as top line, bottom line and productivity measures with others such as supply chain optimisation or data capitalisation rates.
Measurement is crucial, he says, as companies can only improve on what they can measure.
Third, it was important to create a single technology roadmap. This should focus on the particular use cases on which organisations wish to focus along with the specific technologies which they are plan to adopt.
This, Jimenez says, is an area in which many companies fall down. Across the Asia Pacific, he says only ten percent of companies have such a roadmap.
Finally, many organisations need to increase their technology budget and invest in technology and skills.
As things stand, Jimenez says many organisation are focused on doing more with less. In the current environment, some are also postponing investment. Indeed, he says around thirty percent of companies invest only between one and three percent of their revenue on digital technology.
This, he says, is not wise. Without sufficient investment, companies will struggle to achieve their objectives.
This technology investment, Jimenez says, needs to be complemented with investment in organisational skills and capabilities.
“It is fundamental to invest in skills as well as the right technologies so that you can digitalise your construction operations and make your business more resilient,” he concluded.