Insight

Technology in Construction – How Does ConTech Fit In?

If technology is a tool used to help solve problems and streamline processes, its application to the practical world of construction is surely a no-brainer. With projects getting ever more complex, there is an increasing need for construction to embrace new tools, yet with investment lacking and an inherently conservative approach to change, how does the sector overcome the technology construction challenge?

Investment

Firstly, investment must be forthcoming. Professor Andrew Baum of University of Oxford revealed that investment in construction technology (or ‘ConTech’ as he terms it) is significantly behind when compared to property. The numbers back this up: data from UK PropTech accelerator Pi Labs, reported investment in ConTech represented just over ten percent of total investments, over a four-year period. Comparatively, Real Estate FinTech accrued over thirty percent of investments through the same four year period.

It doesn’t help that the industry is beset by low margins. When compared to other industries, such as healthcare, levels of investment in R&D are pretty poor. But how poor? Well, according to the 2016 Global Innovation 1000 Study produced by PwC’s strategy consulting business Strategy&, healthcare leads the way in the UK, investing forty-eight percent in R&D – nearly half of total spend. The automotive industry is second, investing eighteen percent, and consumer industries next, with eight percent of the respective total.

What’s interesting to note is that UK businesses are moving their R&D spend from physical products to software and services, with software investment increasing by a massive sixty-five percent since 2015 – from £56 billion to £93 billion! What’s more, corporations who spent more on software R&D reported significantly faster revenue growth. Strategy& predict by 2020, the majority will have followed suit.

Conservative attitudes towards change don’t help and Matt Gough, Director of Innovation at Mace, suggests that another issue which can slow down investment is scaling: proving that a particular technology will add direct value is key, yet takes time due to the scale of construction and infrastructure projects. “When deciding which new technologies to invest in” Matt says, “it comes down to what is best suited to meet our objectives and goals as a business, and whether the product can be rolled out across thousands of employees. For investment, scalability is key.”

As PropTech expert James Dearsley highlights, the industry has the money but it’s a big gamble. That said, clearly when it’s evident the investment in time and resourcing are valid, and safety concerns have been allayed, then R&D budgets should increase. Construction will reach an inevitable point, as have other industries, where innovative technologies are too big an opportunity to ignore. So, change is coming, but what that change will look like feels vague.

New Horizons

The uniqueness of so many projects in construction presents a technology challenge. Mass automation of more repetitive tasks – as the automotive sector has abundant opportunity to do – is limited in construction. James Dearsley points out, the process side of construction has taken precedence so far as it’s more accessible and easier for people to understand, but notes changing construction itself, slows down around methods such as modular build and 3D printing. “There is a fundamental disconnect between what a planner is planning and a builder is building”, James notes. “Being able to put both into an augmented headset, like the Microsoft HoloLens, is game-changing”, he adds, “not just from an aesthetic perspective, but a safety perspective. It’s not perfect yet, but that is a standout technology for me for the next decade as it evolves.”

This future is already a reality. Skanska UK announced earlier this year that they would become the first UK contractor to trial on site DAQRI smart helmets, heralding a seismic cultural shift and the beginning of an industry-wide adoption of augmented reality technology.

DAQRI technology is changing the way people work,” Malcolm Stagg, Director of BIM & Digital Engineering, Skanska UK, explains. “You don’t need your hands anymore to manage information: this technology provides information in your line of sight, which can warn you of dangers or give you guided instructions. You can call in experts remotely and they can see what you are seeing, providing an extra layer of capability over your core capability. It’s empowering, and if the operatives see it in the right way it’s empowering for them, too, because suddenly they are not alone out in the field: now they have the weight and the might of a global organisation behind them and in a touch, can access that expertise – no matter how small, or discreet, or remote their activity.”

Man vs. Machine

What impact will this have on jobs in construction? The advent of drone technology certainly reduces the need for on-site labour, saving costs and improving safety. Both high risk and mission critical jobs – such as inspecting scaffolding and cranes – can be undertaken by a drone, thus delivering huge safety upgrades. This means less engineers are needed on-site to perform assessments.

In PwC’s study, Clarity From Above: Transport Infrastructure, it reports that drone technology is expected to have the biggest impact on those working in infrastructure. It predicts drones could replace humans in $45.2 billion dollars worth of infrastructure labour and services over the next four years alone. However, this new technology demands workers learn new skills. Indeed, ConTech may even create more jobs within the industry, or at least balance out to recover the losses.

Matt Gough believes in being prepared to adapt, re-skill and retrain in the face of digital innovation, and welcomes this as an exciting opportunity to carve out new roles. “What skill-sets are you going to need in your team to keep the site operational?”, he asks. “Who is going to fix your robot when it stops working, or manage the flight of a drone? As an industry, we should be creative and should be positively responding to change; I’m confident the impact of automation and robotics will be a really positive one.”

I believe that with the costs of developing software cheaper than ever before, and with the adoption of ConTech steadily continuing to rise, perhaps we’re not as far as we think. We may not be fast, but when construction finally embraces technology with conviction and cash, the impact will be vast.

Read more about PropTech & Innovation in our Insight Report here, A Brave New World? Innovating Real Estate