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
| Jan 23, 2014
Think you can recognize a metal building from the outside?
What looks like brick, stucco or wood on the outside could actually be a metal building. Metal is no longer easily detectable. It’s gotten sneakier visually. And a great example of that is the Madison Square retail center in Norman, Okla.
| Jan 22, 2014
SOM-designed University Center uses 'sky quads,' stacked staircases to promote chance encounters
The New School's vertical campus in Manhattan houses multiple functions, including labs, design studios, a library, and student residences, in a 16-story building.
| Jan 22, 2014
Architecture Billings Index sees first back-to-back decline since mid-2012
The AIA's Architecture Billings Index dipped for the second consecutive month in December—the first consecutive months of contraction since May and June of 2012.
| Jan 21, 2014
Comcast to build second Philadelphia skyscraper, with Norman Foster-designed tower [slideshow]
The British architect last week unveiled his scheme for the $1.2 billion, 59-story Comcast Innovation and Technology Center, planned adjacent to the Comcast Center.
| Jan 21, 2014
2013: The year of the super-tall skyscraper
Last year was the second-busiest ever in terms of 200-meter-plus building completions, with 73 towers, according to a report by the Council on Tall Buildings and Urban Habitat.
| Jan 20, 2014
BUILDINGChicago/Greening the Heartland Conference 'call for 2014 educational proposals' is now open
The conference and exposition will take place September 29-October 1, 2014, at North America’s largest LEED Gold-certified hotel, the Holiday Inn Chicago Mart Plaza. Deadline for proposals is February 28, 2014.
| Jan 17, 2014
Crystal Bridges Museum will move Frank Lloyd Wright house from New Jersey to Arkansas
Numerous architectural experts have concluded that moving the Bachman Wilson House offers its best hope for long-term survival.
| Jan 17, 2014
Australian project transforms shipping containers into serene workplace
Australian firm Royal Wolf has put its money where its mouth is by creating an office facility out of shipping containers at its depot and fabrication center in Sunshine, Victoria.
| Jan 17, 2014
The Starchitect of Oz: New Gehry building in Sydney celebrates topping out
The Dr. Chau Chak Wing Building at the University of Technology, Sydney, will mark Frank Gehry's debut project in the Australian metro.
| Jan 16, 2014
Construction spending for 2013 finishing 5% higher than 2012: Gilbane Construction Economics report
??Construction growth is looking up, according to the December 2013 release of the periodic report Construction Economics, authored by Gilbane Building Company. Construction spending for 2013 will finish the year up 5%.