The construction renaissance is upon us

Construction has long been seen as an industry that lacks both evolution and innovation. While other industries have avoided stagnation by becoming more efficient and productive over time, the construction industry has been stalled in its tracks. According to McKinsey in 2017, the industry has failed to keep up with global productivity growth averages, with global productivity growing only 2.8% over the past 20 years. They also found that construction projects typically take 20% longer than expected and are up to 80% over budget.

The construction industry is one of the largest in the world, employing nearly 7% of the world's working-age population and spending approximately $10 trillion annually on goods and services related to construction. building. Reports show that in North America, construction costs have increased by 5% to 11% over last year, and we are currently in a double housing crisis, with a lack of buildings and a lack of affordability. How, then, does an industry that is so important to the economy and housing, with broad financial support, remain stagnant? How is the industry changing?

"Construction is one of those industries where adoption typically lags a decade behind most industries," says Larry Brinker, Jr., CEO of Brinker Group, a family of commercial construction companies . “It has a lot to do with people who were at the project management and leadership level in construction. Typically, they weren't as tech-savvy due to their experience, so the adoption rate was definitely lower when it came to new technologies."

The historical lack of technology adoption in a leading industry would cause many people with the ability to create technologies to optimize to focus on other industries instead. Health, transport, retail and manufacturing are some of the sectors that have seen rapid growth due to both the needs and the creation of new technologies, especially during the pandemic.

René Morkos, CEO of ALICE technologies, a build options platform, shares a similar perspective on why building has traditionally been one of the hardest areas to scale and to digitize. “One of the reasons is that digital information in the field of construction has long been incomplete and compartmentalised; it was difficult to share between different technology providers. Couple this with construction professionals, especially older generations who have been in the industry longer, have always been reluctant to change their processes. »

While technology can be the backbone of many industries, why is lack of adoption holding the industry back so drastically? Brinker, whose companies have been responsible for more than $4 billion in construction projects, says 30% of all ongoing construction work is typically touch-ups. “It adds cost and time to a project because you often identify updates and rework to the project while you have labor in the field, which means the project or that scope of work must now stop while the architects figure it out. .