It’s a new year, a new decade, and a critical time in the construction industry. With new technologies and innovation poised to change the way projects are built, construction companies are under more pressure than ever before to streamline efficiencies and better meet customer demands.
To help prepare firms for changes ahead, we’ve been talking a lot about what construction industry trends to expect in 2020 and beyond. We recently also dove deep with industry experts in our webinar, “Tomorrow’s Construction: 2020 Trends and Predictions.” Our industry insiders were able to share their take on the industry today and where it’s headed tomorrow. And while there are certain universal challenges all construction companies face, like the skilled labor shortage, some of the most significant construction industry trends largely involve how businesses and the workforce are evolving.
If you don’t have time to watch our webinar, we’ve highlighted some of the top insights and construction industry trends discussed by our experts, below. Here’s a closer look at five key takeaways that all construction companies should keep in mind as it pertains to driving the future of the industry and how projects are built.
5 Construction Industry Trends to Follow
Trend 1: Business Transformation
While we’ve certainly all heard about the impact of the Internet of Things (IoT), Virtual Reality (VR), Augmented Reality (AR), blockchain, robotics, and more, software and hardware are just one small piece of the puzzle as it pertains to how business is transforming. In fact, as Olivier Lépinoy, Autodesk Senior Business Development Executive, states in the webinar, construction companies today are thinking beyond just software and more in terms of how they’re running their businesses as a whole today.
Beyond utilizing the aforementioned technologies to their fullest, this also includes examining new project delivery models and operating models to further transform the way their operations work. As Lépinoy goes on to explain, the industry is at a tipping point of sorts, and how companies deliver services is just as crucial as how they get to the end product. As services such as Uber, Amazon, and Spotify, the outcome is the same — but how the product or service is delivered is what differentiates.
“Essentially, this industry is at a tipping point. And the most significant changes impact how the industry is structured and services are delivered – not just the way buildings are built.” – Olivier Lépinoy Autodesk Senior Business Development Executive
Trend 2: The Commoditization of Construction
Though unnerving, the commoditization of construction is something that we’re likely to hear a lot more about. Take Skanska, for example, a Swedish based contractor and one of the world’s largest construction companies. Another big Swedish-based company is none other than IKEA. Fittingly, the two have formed a partnership where Skanska will build and install prefabricated homes using modular construction practices in parts of the Nordics. According to Lepinoy, you can literally walk into some IKEA stores, pick out your home from various components, and then Skanska will actually deliver and build it for you on the spot.
“A new business was created by bringing together IKEA’s strength in direct-to-consumer modular furniture, and Skanska’s strength as a leader in construction and development – the model is working.” – Olivier Lépinoy, Autodesk Senior Business Development Executive
Why is this notable? Because it represents an interesting crossroads of where the industry currently stands. If a consumer can walk into an IKEA and get their home from the store, what does this mean for the future of architects and builders? To avoid commoditization, some construction companies are working to adopt new business practices and integrate value-added services such as design and engineering, real estate development, and even design and fabrication shops to streamline delivery.
Trend 3: The Rise of New Innovation Roles
Data is the world’s new currency. Analytics is no longer just a buzzword, but a staple in most major industries. From marketing firms looking to maximize their reach and audience to sports teams looking for a competitive advantage over their opponent, it’s becoming the norm in all industries.
Though construction tends to be a late adopter to change, we’re starting to see new roles and departments emerging within companies that are centered around innovation and analytics as well — notably when it comes to the executive suite. Construction companies are beginning to appoint Chief Data Officers, Chief Digital Officers, Chief Transformation Officers, Chief Experience Officers, and Chief Analytics Officers. The goal of these new roles is to help companies further leverage data and business analytics to see trends and win more work. Furthermore, construction companies are forging relationships with technology companies, shifting their collaboration from a vendor to a partner.
“Positions like Chief Data Officers, Chief Digital Officers, and even Chief Transformation Officers are being created to help CEOs understand and leverage their business analytics – we may even see a title like Chief Analytics Officer.” – Olivier Lépinoy, Autodesk Senior Business Development Executive
These new roles and partnerships are the result of firms embracing technology as an asset and relying more on data and analytics to drive day-to-day operations. It represents a big shift in the industry, and it’s one that’s likely to continue to play out — perhaps even to the point where more firms are conducting activities related to controlling data quality and enforcing data capture methods. Combine this with the fact that more firms are using — and will continue to use — data tools to help run their daily operations, and there’s a cultural transformation on the horizon regarding how business decisions are made. This is only the beginning, as new tools and systems will inevitably be created to further manage projects and delivery.
“Data on its own doesn’t tell us anything – it needs interpretation. We can use analytic engines and AI to help uncover insights.” – Olivier Lépinoy, Autodesk Senior Business Development Executive
Trend 4: Industrialized Construction Is Becoming Increasingly Empowering
You’ve likely heard of Industrialized Construction (IC) before. Still, according to Ryan McMahon, Autodesk’s Director of Industrialized Construction, it’s likely to become more of a complementary piece to traditional construction practices now and in the future. That’s largely because you can add value when you’re designing from a standard platform and better understand what you can and cannot build. Noting this, in addition to companies like Factory OS and BLOX leading the way, IC empowers better estimating, helps reduce risk and the potential for on-the-job injuries, and helps accelerate start and delivery.
“Construction is really at an inflection point undergoing major shifts, and industrialized construction is one of these shifts.” – Ryan McMahon, Autodesk’s Director of Industrialized Construction
Furthermore, designers can spend more time designing and less time on mundane, busy tasks that have a tendency to bog down the project and are more prone to error. And when that occurs, delivery times are enhanced, and the cost is reduced — both of which are major wins for today’s competitive construction landscape.
“If you can find the parts of your project that are repeatable, you can use industrialized construction methodology to greate effect. Designers will start to see industrialized construction as enabling technology. It will allow designers to spend more time on the design and creative intensive portion of the project.” – Ryan McMahon, Autodesk’s Director of Industrialized Construction
In other words, IC platforms become a repository for collective knowledge, thereby allowing teams to spend more time on the parts of a project that lend themselves to creative skill and less time on everything else. IC enables teams to become more innovative while providing consistency to the foundational work.
Trend 5: The Digital Thread Is Changing the Way We Work
Profit margins in construction are notoriously thin. Noting this, project economics in and of themselves should be enough to inspire change to the way firms conduct business. Yet, there’s evidence to suggest that incremental improvements aren’t sufficient, and more widespread change needs to occur for companies to remain profitable as well as relevant.
“We can’t get by on just incremental improvements anymore. You really need an order of magnitude types of improvements in our overall processes to meet the demands that we see in the construction space and to build all the buildings we need for our exploding global population.” – Ryan McMahon, Autodesk’s Director of Industrialized Construction
Connecting data is critical here, according to McMahon. That’s where digital twins can pay big dividends, as they can capture the project lifecycle from design to logistics, improve operations, and always ensure that there’s a keen watch on overall project status. New, emerging technology can provide that digital thread that connects data. Digital twins, when utilized correctly, won’t just help firms become marginally more efficient — but significantly more efficient.
“The digital thread will change the way that people work. We really do need to look at the tools and processes we are using and find opportunities to connect them, to automate them, and to make more comprehensive workflows to take advantage of the efficiency of the tools that are available to us.” – Ryan McMahon, Autodesk’s Director of Industrialized Construction
Adopt Today’s Construction Industry Trends to Transform Tomorrow
As you can see, data, digitization, and other innovations are likely to define the construction industry in 2020 and beyond. The firms that embrace these construction industry trends are likely to stay relevant, profitable, and ahead of the competition. The industry is changing; it’s up to you and your firm to decide whether or not you’re going to change with it.
What 2020 construction industry trend do you think will be most important for your business? Share your thoughts in our comments section below!