The construction industry will hit digital tipping point in 2020

The construction industry has not always been renowned for its innovative approach or its eagerness to embrace digital change and business transformation. However, recent research in the field suggests that 2020 could be the critical year in terms of digital transformation for the construction sector, as challenging areas such as supply chains, productivity and risk management are gradually being addressed.

A new industry report was commissioned by Causeway, a UK construction company, with the aim of assessing how digital innovations were being adopted across the construction industry. The report involved a survey of 200 key decision-makers in the building industry in the UK, including Birmingham City University, Eiffage Kier and Atkins.

The findings of the survey show that 54% of respondents agreed that the construction industry has been relatively slow in the uptake of new technology and the integration of new digital practices. However, despite this acknowledgement, the survey did reveal that there is an optimism and a growing appreciation that investment in digital technology can have a positive effect on business.

70% of respondents reported a positive impact on the project and operational management, with improved flows of data and information. 58% felt that the investment in technology had an impact on recruitment and jobs, with success in attracting and also retaining essential new digital talent.

Advances were also realised in commercial performance, with 54% reporting workforce productivity improvements, 56% reducing their operating costs and 43% seeing business win rates increase. The supply chain was another area to see a positive impact, with 48% feeling that relations within the supply chain were stronger.

There are still challenges in the industry, as respondents reported in the survey. It was felt that there were key areas to be addressed for the industry to really move forward and fully embrace digital transformation. Firstly, there is a need to have a standardisation of technology in the supply chain to aid cohesion. The workforce is another area which requires focus as there is a necessity to develop a new workforce that is digitally driven and diverse.

Lastly, there is a need to increase profitability so that continued investment in the digital transformation is possible. Phil Brown, the Chief Executive of Causeway, cited this as one reason why the industry has lagged behind technologically, specifically mentioning the cycle of low-productivity and low-profitability as challenges to the industry.

Notwithstanding this, an encouraging 81% of respondents in the survey reported that they would, in fact, be making greater efforts to implement digital changes and improvements to their businesses in the construction industry within the next 12 months. In order to fully embrace the technologies and digital transformation, it is necessary to harness and employ web-enabled, intuitive, mobile technology that allows data to be easily accessed and shared on the front line and all the way through the business.

Time will tell exactly how and when the industry fully embraces digital transformation, but as Phil Brown says “in today’s mobile and digitally-enabled world, success will increasingly be found”.