Evolution or revolution: A global view of the digitalization of the construction industry from the World Economic Forum (WEF) Davos.
According to the World Economic Forum (WEF) Davos, a global megatrend can be discerned:
Over the past ten years, digital progress has affected entire industries and fundamentally changed them. Platforms and streaming services such as Facebook, Spotify, and Netflix have transformed media and entertainment, and e-commerce giants such as Amazon and Alibaba have conquered the world market. New innovative technologies have improved the productivity and sustainability of companies and have redefined the skills and competencies for business success. In complete contrast to the construction industry, which has stood still and continued its activities as in the past decades. The World Economic Forum (WEF) Davos analyses that this industry is still heavily dependent on manual labour, machine technology and established operating and business models. The consequence is stagnating productivity.
Digitization of the construction industry: Long gone are the visions of the future, but reality.
The fact is that digital technologies have only recently found their way into the construction industry and have gradually changed the way in which planning, construction, operation and maintenance are carried out. Technologies such as Building Information Modeling (BIM), prefabrication, networked design and construction, wireless sensors, 3D printing and automated and robotic devices are revolutionizing the industry more and more.
Based on the various future scenarios for the construction industry developed by the World Economic Forum (WEF) Davos together with 30 major companies based on global trends, the WEF draws a clear conclusion: existing capabilities, existing business models and strategies no longer meet the future requirements to succeed.
“Current business models, strategies and capabilities will no longer suffice in the future,” says Michael Burke, Chairman and CEO of AECOM and Co-Chair of the World Economic Forum Infrastructure and Urban Development Community. He continues: “The players along the value chain of the construction industry must prepare themselves strategically well in order to be successful in the face of the expected turbulences.
A finding that seems to be gaining widespread acceptance: 74% of the most important CEOs in the construction industry at the World Economic Forum (WEF) Davos 2018 already gave priority to attracting new talent and improving the skills of the existing workforce in order to remain competitive. Improving integration and collaboration along the value chain (65 %) and introducing advanced technologies on a large scale (61 %) were other important measures they considered.
“The decision-makers in the construction industry should understand the uncertainties outlined in the future scenarios as a wake-up call and use them to prepare and shape a successful future – a future that will enable industry to play its role in promoting economic growth, social progress and environmental responsibility,” says Luis Castilla, CEO of Acciona Infrastructure and advocate of the “Future of Construction” initiative of the World Economic Forum (WEF) Davos.
The World Economic Forum (WEF) Davos is looking at how companies in the construction industry can best prepare for the future, regardless of the direction the overall development takes:
Attracting new talent to develop the skills required for the new digital technologies.
Every possible scenario for the future requires talents with significantly different skills than today’s. Adequate training processes must be created.
Integration and collaboration along the entire value chain of the construction industry.
The construction industry must ensure that seamless data flow and integrated systems are guaranteed in the future and no longer hindered.
The use and consistent use of state-of-the-art digital technologies.
The construction industry has been slow to adapt to new technologies. It is still heavily dependent on manual work and mechanical processes, which leads to poor productivity. This must be changed.
Maximizing the use of data and digital models.
This includes a thorough review of existing practices and infrastructure asset portfolios to open up new business opportunities and enable true change management.
The most important conclusion, however, is that companies in the construction industry must act now to avoid future turbulence and negative developments. The dramatic changes on the horizon point to an uncertain future for the global construction industry and its more than 100 million employees. Other global megatrends should also motivate companies to rethink familiar and established industry practices: climate change, resource scarcity, the growing shortage of talent and rapid urbanization – more than 200,000 people move from rural areas to cities every day – are just some of these trends.
The World Economic Forum (WEF) Davos, however, takes a positive view of the future of the construction industry as a whole: “Within a decade, complete digitization could help the industry escape decades of stagnation and achieve 12-20% of annual cost savings – between 1 trillion and 1.7 trillion dollars, according to estimates by the World Economic Forum (WEF) Davos.
Source: World Economic Forum (WEF) Davos