Basic Digitization Could Shape the Future of Construction
Jarrett Silver
The industry has been slow to embrace new technologies. But the benefits of modernizing workflows and processes are hard to ignore.
Visiting the offices at many construction sites today is a lot like visiting the offices of companies in manufacturing, retail or any other sector—if the visit took place in 1990.
Construction site offices won’t typically greet you with slick applications, digital graphs and staff drawing conclusions from vast amounts of data. Instead, it’s common to find an army of administrative and operational staff drowning in paper, rushing to bring order to the perpetually increasing discord.
But digitization of the construction industry, which represents 9 percent of the UK economy, is possible—and necessary. Industry leaders have been slow in implementing technology compared with other industries, and low margins have prevented them from making digital investments. Still, a cultural shift is needed, and those leaders can dramatically improve construction efficiency without spending much more on advanced technologies like artificial intelligence.
They can do it with basic software and tools—technology that has been around for more than a decade.
Slow adoption of new technology in construction hurts the bottom line
Construction projects rarely involve a single company. The delivery of projects usually involves engaging an array of subcontractors for specific tasks, and the subcontractors often hire contracting staff. The effects of errors or delays are compounded.
David Rosenfeld, a managing director of the UK construction firm Offeld Services, recalled one job where four electricians were assigned to install wiring in an apartment: “This should have taken two days, but there was an inadequate supply of materials, meaning two apartments could not be done. Furthermore, two electricians had no work, so they had to go home, but they still had to be paid as it was in the contracts.”
Better methods for coordinating the work and materials would have prevented this situation, and there was also a spillover effect. Tradesmen scheduled to work the following day were delayed, resulting in a loss claim. Situations such as these, and the lack of appropriate software on the market, were the driving force behind Rosenfeld founding Clamtek, a construction productivity software to control labor and materials on site.
Another problem common to construction firms is high staff turnover, making it more difficult to set consistent working practices and procedures. A standardized digital platform that could assign workers tasks and provide clear workflow and instruction uniformly would ease that problem, make things better in a subcontractor-heavy industry—and generally improve efficiency.
Technology’s effect on productivity
Source: Office of National Statistics. Labour productivity by industry division.
In the UK, construction industry productivity has consistently lagged behind both the broader economy and also sectors such as manufacturing that have more fully embraced technology. But there’s nothing unique about the construction industry that would prevent it from leveraging the benefits of digitization.
Not much has changed since 2016, when associate principals at McKinsey identified the construction industry as “ripe for disruption,” with large projects consistently taking 20 percent longer than scheduled and running up to 80 percent over budget. In the same year, Brenan Betchel, now CEO of his family construction firm, said that 98 percent of construction projects experienced cost overruns or delays, that the average cost increase was 80 percent and schedule delay averaged 20 months.
Some pioneering firms—namely PlanGrid, Rhumbix, Procore, Fieldwire and a smattering of early stage ventures such as BuilderStorm and Clamtek (Rosenfeld’s company)—have the potential to transform the construction industry in the next few years. But the approach of these firms is more the exception than the rule and hasn’t broadly permeated into the industry.
Most discussions about digitization focus on AI-powered robots replacing humans, drones whizzing overhead, instant-setting concrete, NFC (near-field communication) technology within materials and 5D Building Information Modelling. But implementing these technologies would be like constructing a building’s frame before the foundation.
Put another way, the industry needs to catch up with the present before it lurches into the future. They should turn to basic software, the likes of which has been around for over a decade.
Seven ways software can modernize job sites quickly
Replace paper time sheets with electronic versions.
Replace paper records with digital employee profiles detailing their skills.
Replace paper-driven task allocation with detailed, clear and consistently formatted digital task allocation through which workers could post updates and photos and record issues.
Switch from paper progress reports to real-time digital software that management could use to inform their decisions.
Implement material management with clear digital authorization for ordering, digital allocation to tasks and site tracking.
Use tablets instead of physical rolls marked up by pencil for plans and technical drawings.
Use geolocation tracking to replace the uncertainty surrounding workers’ locations on site.
The collective impact of these approaches would be revolutionary.
Beyond immediate efficiency gains and decreased delays and costs, the increased speed of digital task instruction and supervision would reduce the need for supervisory and administrative staff and resources. Embracing this approach is hugely important given the skills shortage in the construction industry in the UK and globally. Further, the industry’s infamously low profit margins would begin to improve.
The power of data
Basic digitization of job sites would provide a wealth of data that job-site leaders could use to make faster and better decisions, generate new best practices and avoid repeating mistakes. Records of the time and resource expended per task, logs as to what caused delays and the extra time and costs incurred would become available.
The additional data also would drive faster resolution of disputes—which are commonplace due to razor-thin margins and project management failings. Drawn-out disputes are disruptive and lead to delays and unexpected costs, inevitably drawing in multiple parties and their management.
Digital applications can maintain and provide reliable and accurate records in ways paper never could, helping to prevent disputes from occurring by giving both parties access to the same timeline of events and data. If a dispute does occur, clearer records would be invaluable and could aid its timely resolution.
"A party to a dispute, particularly if there is an arbitration, will learn three lessons (often too late): the importance of records, the importance of records and the importance of records,” wrote Max Abrahamson, a renowned international construction lawyer.
Impact on health and safety on the job site
Finally, digitization could improve worker safety. In 2018, 21 percent of worker fatalities in the US private sector occurred in construction; and in 2019 (through October), the fatal injury rate in construction in the UK was three times the rate for all industries.
Clear profiles describing workers’ individual skills and qualifications would prevent people being assigned work that does not fit their abilities. Better digital direction about proper equipment and materials and where to find them would help prevent accidents. And visibility into an individual’s location through geolocation tools could help site managers determine when workers are unintentionally approaching dangerous areas.
While the challenge of digitization might seem daunting, the type and availability of solutions—many of which have been used in other industries—should be a source of comfort for construction industry executives. It means that they can turn to basic organizational software that has been used to great effect in other industries for years.
This technology and software are cheap, tried and tested—and they offer an unrivalled, instant return on investment.