Engineering and Construction (E&C) is the second largest industry in the UK. In 2018, Construction alone contributed to 6% of the UK’s total economic output.1 Furthermore, every £1 spent on UK construction creates £2.92 of value for the UK economy.2 Technology, more specifically, digitalisation of practices, has been continuously mentioned as one of the greatest drivers of growth across all industries in the future. Yet, E&C remains the least digitalised industry in Europe. It is plain to see how this has affected the sector, labour productivity growth in global construction has averaged just 1% a year over the past 20 years. This is well below the 2.8% growth for the total world economy.3
The industry needs to become more efficient and technologically advanced in order to cope and keep up with some of the global megatrends -most notably the globalisation of markets and emerging economies. Over the next ten years 65% of construction growth will occur in developing countries with 1 in 2 E&C companies stating that they plan to move into new geographies. Additionally, projects are becoming larger and more complex e.g. China plan to build a 123km long undersea tunnel by 2026. There is also an increased need to deal with ageing infrastructure – 1 in 3 bridges in Germany are over 100 years old. There is increasing pressure to become sustainable in a green era, 50% of the solid waste in the United States is produced in E&C and they are also the number one consumer of global raw materials. Furthermore, as E&C gets left behind and their legacy applications continue to age, they become increasingly vulnerable to cyberattacks.4
The first step is cloud
Change is both needed and possible. E&C organisations must empower themselves and their employees with modern tools and apps to innovate and stay competitive. The first step must be migrating to the cloud. Building Information Modelling (BIM) or a centralised cloud platform, such as Microsoft Azure facilitated by Kainos, will transform every step of the construction roadmap from tendering to maintenance. It can maximise productivity by provisioning businesses with an accessible pool of data, allowing them to improve monitoring and predictive analytics, organisation and planning, communication and it can act as a pipeline for further digital transformation with technologies like AI, the Internet of Things and MR
Improved monitoring will greatly help conserve budget and help improve project management. Projects often overrun and can accumulate unexpected costs. This is because issues are often identified too late which hinders the ability to change course quickly and cheaply. By having data in the cloud, companies can monitor projects in real-time and use predictive analytics to look ahead. It also helps manage remote servicing, improve energy control as well as predicting maintenance needs.
Project planning & organisation
Enhanced planning and organisation can also help to decrease the probability of projects overrunning. Instead of siloed construction processes, data stored in the cloud can facilitate front-loaded and cost-conscious design and project planning. Digitally enabled procurement and supply chain workflows can generate and run sophisticated logistics management as well as just-in-time delivery. In terms of organisation, cloud can help manage your workforce with connected workers and tools, such ascreating a tool inventory and tracking system. It can facilitate workforce planning, smart hiring and enhanced retention. It can also help the organisation at a basic level to help standardise and simplify documentation.
Communication is becoming more and more important not only to handle activity in global markets but to build on previous experience and communicate solutions throughout the company. Cloud can increase knowledge capture and management of know-how from every stakeholder along the construction process. Knowledge held by project owners, designers, constructors and suppliers can be used to tackle problems and capture solutions in instances when problems repeat themselves – which they often do.
Lastly, all this information can be protected from attack or theft within the cloud. As cyberattacks become more advanced and dangerous, targeted industries must equip themselves with the right tools for protection and defence. Cloud not only offers high-level security, but it also allows for the swift integration of new and advanced solutions as they become available.
The possibilities and rewards are endless. One study found that the sector could boost its productivity globally by up to 60%, reduce completion times by 30% and cut costs of up to 20% through the implementation of technology. As an indicator to the effect technology can have on the global E&C industry, it is expected that within 10 years, full-scale digitalization in non-residential construction will be capable of producing annual global cost savings of $0.7-1.2 trillion (13-21%) on E&C and $0.3-0.5 trillion (10-17%) in the operations phase.4
If you’re ready to make the move to public cloud but don’t know where to start, or have started but need help completing the journey, then Kainos can help, drawing on the breadth of experience we have of designing, building, modernising and delivering services on the public cloud. Kainos have the cloud adoption expertise to help the transformation of your business. We have a proven track record of enabling organisations to migrate, modernise and manage their digital platforms in the cloud and realise the full financial, business and agility benefits available. We won’t just talk you through the theory of migration, we will show you how and where we have done it for our customers in complex and business-critical environments. Visit our Starting the Cloud Journey page to find out more.
1. Construction industry: statistics and policy (2019). House of Commons Library. Available Here
2. Whitepaper: Reconciling the Irreconcilable (2020). Microsoft. Available Here
3. Improving Construction Productivity (2017). McKinsey & Company. Available Here
4. Shaping the Future of Construction: A Breakthrough in Mindset and Technology (2016). World Economic Forum and The Boston Consulting Group. Available Here