Is the construction industry up to the challenge of repairing the world’s crumbling infrastructure? A new report from McKinsey & Co. answers with a definitive “No,” unless the industry can place itself firmly into the digital future in its organization, documentation, management, and information sharing.
The think tank estimates that the world will need to spend $57 trillion on infrastructure by 2030 just to keep pace with global economic growth. A recent report by three of its researchers also sees a construction industry that takes 20% longer than scheduled to finish most projects that come in up to 80% over budget.
“Construction productivity has actually declined in some markets since the 1990s,” writes the report’s authors, Rajat Agarwal, Shankar Chandrasekaran, and Mukund Srishar, in an article they posted last month. “The construction industry is ripe for disruption.”
Such observations are hardly new; there have been myriad other reports that lament the same problems in the construction sector, and fret about how massive reconstruction can possibly be accomplished.
What makes this paper a little different is that the “five big ideas” proposed by its authors aren’t at all futuristic.
Five trends that are making the construction process run smoother and quicker. Image: McKinsey & Co.
The authors basically believe that the construction industry needs to be reorganized around digital technology, including:
•Higher-definition surveying and geolocation
•Next-generation 5D BIM
•Digital collaboration and mobility
•The Internet of Things (IoT), coupled with advanced analytics
•Future-proof design and construction with sustainable materials and methods.
Within these trends, McKinsey sees LIDAR as “an evolution in surveying,” primarily because of breakthroughs in drone technology and handheld platforms.
Five-D BIM goes beyond 3D BIM by taking into account a project’s cost and schedule. “The visual and intuitive nature of 5D BIM gives contractors a better chance to identify risk earlier, and thus to make better decisions.” Augmented reality technology will further enhance the effectiveness of 5D BIM, which project owners and contractors “need to incorporate right from the design stage.”
McKinsey revisits the need for the construction sector to move aggressively toward online communication as a way of improving productivity. Paper, the report argues, makes data analysis among team members tougher, and is subject to being mismanaged among different stakeholders.
By comparison, the authors point to an American tunnel project that involved 600 vendors, for which the contractor developed a single platform for bidding, tendering, and contract management. “This saved the team more than 20 hours of staff time per week, and cut down the time to generate reports by 75%,” they write.
Perhaps more to the point, the digital-collaboration and mobility solutions segments have attracted close to 60% of all venture capital funding in the construction-technology sector.
The report also suggests several advantageous potential uses for IoT working in combination with sensors and near-field-communication devices. These uses include equipment monitoring and repair, inventory management and ordering, quality assessment, energy efficiency (such as sensors monitoring ambient conditions and fuel consumption of equipment), and safety.
As for future proofing projects, the report lists a host of new building materials—self-healing concrete, aerogels, nanomaterials—and construction approaches—like 3D printing and preassembled modules—that could lower cost and speed up the construction process.
“Some of these ‘materials of the future’ could redefine how projects are conceptualized, designed, and executed,” states the report. It notes, however, that adoption of these materials has been slowed by a lack of awareness and availability, limited supply chain, and the industry’s risk aversion.
While 80% of all construction work is still done on-site, more project developers and contractors are deploying off-site approaches “that help them improve predictability, consistency, and repeatability.” These approaches include preassembly of components and simply structures, 3D printing, and robot-assembled construction.
None of these recommendations will surprise any nonresidential contractor. The question, though, is why aren’t these ideas being implemented more widely? The McKinsey authors say the industry needs “to adopt a new mindset” whose foundation is shared responsibility, and has four principles:
•Transparency and risk sharing in contracts
•Return-on-investment orientation
•Simplicity and intuitiveness in the design of new solutions
•Change management (as in top management communicating clearly why changes are important)
Project owners and developers need to mandate the adoption of digital technologies and measure results. This should include appointing a Chief Technology Officer or Chief Innovation Officer who can think boldly about the company’s digital agenda.
Engineers and contractors need to develop “digital road maps” for project management. “And it’s important to ensure that project teams have the budgets and authority they need to pilot new technologies. It’s essential to build the capabilities of project managers so they can become digitally adept.”
Related Stories
Student Housing | Jul 31, 2024
The University of Michigan addresses a decades-long student housing shortage with a new housing-dining facility
The University of Michigan has faced a decades-long shortage of on-campus student housing. In a couple of years, the situation should significantly improve with the addition of a new residential community on Central Campus in Ann Arbor, Mich. The University of Michigan has engaged American Campus Communities in a public-private partnership to lead the development of the environmentally sustainable living-learning student community.
MFPRO+ New Projects | Jul 31, 2024
Shipping containers converted into attractive, affordable multifamily housing in L.A.
In the Watts neighborhood in Los Angeles, a new affordable multifamily housing project using shipping containers resulted in 24 micro-units for formerly unhoused residents. The containers were acquired from a nearby port and converted into housing units at a factory.
Adaptive Reuse | Jul 30, 2024
Empty mall to be converted to UCLA Research Park
UCLA recently acquired a former mall that it will convert into the UCLA Research Park that will house the California Institute for Immunology and Immunotherapy at UCLA and the UCLA Center for Quantum Science and Engineering, as well as programs across other disciplines. The 700,000-sf property, formerly the Westside Pavilion shopping mall, is two miles from the university’s main Westwood campus. Google, which previously leased part of the property, helped enable and support UCLA’s acquisition.
Contractors | Jul 30, 2024
Barton Malow is celebrating its 100th anniversary with a road show
A traveling exhibit will make 30 stops this summer and fall, many at project sites.
Geothermal Technology | Jul 29, 2024
Rochester, Minn., plans extensive geothermal network
The city of Rochester, Minn., home of the famed Mayo Clinic, is going big on geothermal networks. The city is constructing Thermal Energy Networks (TENs) that consist of ambient pipe loops connecting multiple buildings and delivering thermal heating and cooling energy via water-source heat pumps.
High-rise Construction | Jul 29, 2024
Safdie Architects’ Shanghai office tower features glass-enclosed corner garden that ascends the 35-story structure
Safdie Architects has announced the completion of LuOne Mixed-Use Complex—a business, retail, and entertainment development in the Luwan district of Shanghai, China. The mixed-use complex consists of an eight-level retail galleria, which opened in 2018, and a 35-story office tower, which recently reached completion.
Casinos | Jul 26, 2024
New luxury resort casino will be regional draw for Shreveport, Louisiana area
Live! Casino & Hotel Louisiana, the first land-based casino in the Shreveport-Bossier market, recently topped off. The $270+ project will serve as a regional destination for world-class gaming, dining, entertainment, and hotel amenities.
Smart Buildings | Jul 25, 2024
A Swiss startup devises an intelligent photovoltaic façade that tracks and moves with the sun
Zurich Soft Robotics says Solskin can reduce building energy consumption by up to 80% while producing up to 40% more electricity than comparable façade systems.
Codes and Standards | Jul 25, 2024
GSA and DOE select technologies to evaluate for commercial building decarbonization
The General Services Administration and the U.S. Department of Energy have selected 17 innovative building technologies to evaluate in real-world settings throughout GSA’s real estate portfolio.
Great Solutions | Jul 23, 2024
41 Great Solutions for architects, engineers, and contractors
AI ChatBots, ambient computing, floating MRIs, low-carbon cement, sunshine on demand, next-generation top-down construction. These and 35 other innovations make up our 2024 Great Solutions Report, which highlights fresh ideas and innovations from leading architecture, engineering, and construction firms.