Construction Workflow Adoption Remains a Work in Progress

Unlike the manufacturing, banking and transportation sectors, the construction industry has been relatively slow to embrace the avalanche of new workflow technology applications designed to improve efficiency and reduce production costs.

A big part of this reticence was derived from the hangover of the Great Recession when the bottom fell out of the real estate market between roughly 2007 and 2010. Foreclosures and bankruptcies plagued commercial and residential developments across the country, resulting in a major retrenchment for the hearty builders and vendors that somehow managed to survive the meltdown.

Aside from some notable exceptions, investing big money for nascent workflow technology simply wasn’t much of a priority while Rome was burning. Less investment in these tools had a ripple effect not only on the vendors that saw their own sales stagnate, but also on the overall efficiency of the ongoing and future construction projects in the pipeline.

With this painful memory still seared into their psyches, owners, architects, project managers and contractors across the construction management spectrum are only now starting to ramp up investment in the workflow apps that will drive their growth for the foreseeable future. This, in turn, will fundamentally reshape how large-scale commercial and residential projects are managed from start to finish.

But it’s going to take some time.

Business information modeling (BIM) is central to the orchestration of all the moving parts involved in any construction project to keep all stakeholders in the loop. There are literally dozens of BIM applications including the likes of Autodesk BIM 360, Procore, BIMObject and Archicad. These files, which are often proprietary and cloud-based, are used to help design, construct and visualize projects from inception, allowing all participants to move from linear workflows to real-time collaboration in the field.

Using computer-aided design (CAD) apps in 3D, BIM systems assist project managers in reducing costs by identifying and fixing errors on the fly – rather than shutting down production for modifications – and speed up construction schedules. 

But these multimillion- or multibillion-dollar projects demand a broad swath of functionality. Tracking capabilities throughout the project’s lifecycle allows everyone to access a real-time snapshot of the profitability of on-going projects, monitor depreciation and provide a dashboard for accounting, scheduling and maintenance.

There simply is no plug-and-play software solution that manages the breadth and depth of processes and functions required for large-scale construction projects – at least not yet.

Virtual reality (VR) and augmented reality (AR) blended with BIM apps brings the design to life, giving owners, architects and contractors a detailed view of where the project stands, where it’s going and whether or not modifications or design changes need to be made without interrupting the production schedule.

“Putting AR around BIM has provided designers an opportunity to create real-time walk-through scenarios,” said Scott Brandt, CEO of eQuorum, an Atlanta-based document management and cloud workflow software provider. “This was a big sea change. Before there was pro forma acceptance of this type of solution, models were constructed based on a 2D drawing.”

“When something needed to be fixed, it would take forever to determine who accepts responsibility for the extra work and that’s traditionally when tons of finger-pointing (took place),”
he said.

The timing couldn’t be better for construction technology investment. According to McKinsey, worldwide infrastructure investment – which includes real estate-related projects – topped more than $6 trillion in 2013. That figure is expected to double to more than $13 trillion by 2030.

However, the management consulting firm found that a whopping 98 percent of these projects endure cost overruns or delays – or both.

“There are many reasons for this poor record,” the report concluded. “Start with productivity – or, rather, lack of it. Construction productivity has been flat for decades. Manufacturing, by contrast, has nearly doubled over the same period and continuous improvement has been the norm.”

The culprit in many cases was what McKinsey researchers called “inconsistencies” in reporting, meaning that subcontractors, contractors and owners still don’t have a common understanding of how the project is fairing at any given time. On the ground, when daily work on a given project isn’t completed – for whatever reason – schedulers need to know so they can update priorities in real time.

When there’s a disruption to one facet of a project, it quickly cascades into a series of problems and delays that lead to cost overruns, dissatisfied owners and diminishing profits.

It’s still early, but artificial intelligence and machine learning are starting to get a foothold in the construction technology ecosystem. In the first half of 2018, more than $1.05 billion was invested in construction technology startups to bring some of these advanced algorithms to the jobsite.

While there’s plenty of enthusiasm for construction technology software among the venture capital crowd, it’s not really translating to the field. The sheer scope of large projects often spanning several geographic locations combined with a genuine dearth of labor – particularly those fluent in these new technologies – is a bottleneck that needs to be resolved.

With so many software options available – even as the construction technology sector itself consolidates more and more with each passing quarter – large construction firms are struggling to discern what tools they should be investing in while simultaneously managing multiple projects at any given time.

“Every firm has limited resources, and taking the time to go through the process of selecting, adopting and supporting new technology uses a big chunk of those resources,” said Henry D’Esposito, senior research analyst of project and development services at JLL, a Chicago-based professional services and investment management company specializing in real estate. “High industry demand and long work backlogs over the past few years meant that many firms did not have a chance to catch their breath, and instead have focused on the projects in front of them.”

Project planning still remains largely uncoordinated between the office and the field and is often still done on paper, McKinsey found. Contracts don’t always include incentives for risk-sharing and innovation and supply-chain practices are still largely unsophisticated. Paper blueprints and 2D models are still widely used despite more efficient, vibrant and collaborative alternatives.

As of 2016, research and development spending in construction lagged its peers in most other sectors. These firms spent less than 1 percent of their revenue on R&D compared to 3.5 percent and 4.5 percent, respectively, for the auto and aerospace sectors.

“The industry has not yet embraced new digital technologies that need upfront investment,” the report found. “Even if the long-term benefits are significant.”

With so many different stakeholders involved, realizing and maximizing the potential of these apps without any hard and fast technology standards remains an elusive but necessary goal.

“Architects are taking their directions from owners,” Brandt said. “Engineers use their own systems. Construction companies have all their own systems. Right now there are so many players and applications. The issue is how the industry as a whole can focus on standards and best practices that can be handed off from one entity to another. How do I get 25 different vendors on the same page?”

In the here and now, however, many of the largest construction firms and contractors have quickly adopted new technologies such as wearables, drones and, obviously, smartphones and tablets to drive efficiency and innovation. The ability to take a picture or a video and send it to colleagues and partners anywhere in the world or sharing documents via Dropbox and other file-sharing cloud services has changed the game.

These advances come with trade-offs – security issues primarily – but bode well for an industry that’s caught between two worlds.

But where should these construction firms begin?

“Focus on technology that will be fundamental in the future,” D’Esposito said. “BIM has been around a long time but many firms are still not utilizing it.”

He said that most of the technology that will shape the future of construction management, including drones, AR and VR and modular construction, all require a robust BIM program to be used to their full potential.

“Invest in that now and it will serve as a foundation for a firm to be effective and nimble with future technology adoption,”
he said.

Any discussion about future technology adoption, regardless of industry, inevitably must include automation. Bricklaying and rebar tying robots are already out in the construction field and their prevalence and functionality will only expand over time. But the less-than-controlled environment of a construction site is not (yet) an ideal setting for automating most of the repetitive tasks workers perform today.

In the not-too-distant future, core BIM software will likely incorporate other dimensions including cost, time and IT resources to ease project management throughout the executive phase and to facilitate maintenance during operations. A holistic view of the overall status of every element of a given project that can be shared and evaluated by owners, engineers and contractors in real-time means more projects will be completed on time and with fewer cost overruns.

But it won’t happen until construction and engineering firms fully commit to the technology and invest the time and money necessary to do it right. And that won’t happen until the technology vendor landscape becomes more defined.

“With the large number of competing technology providers, firms can suffer from decision paralysis trying to pick just one,” D’Esposito said. “To complicate things further, firms need to consider whether the various technology providers they select will all integrate with each other smoothly.

“The result is a hesitation by firms that are unwilling to invest until the dominant tech provider becomes clearer,” he added. “Once a firm decides they do want to focus more on new technology, the selection process is where they are most likely to get stuck.” 

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is an editor and analyst at BPO Media.