It’s become painfully clear that the AEC industry needs to move into the digital age. But are we ready? I recently read a report from McKinsey & Co. titled “Imagining construction’s digital future“. It’s packed with ways for AEC firms to adopt data driven efficiencies and insights.

It also reminds us of how many barriers there are to entry.

Too busy to read the 14-page article? Check out these cliff notes below along with my idea for how AEC project teams can harness the disruptive power of data.

The construction industry is ripe for disruption
As McKinsey has already highlighted in their 2015 report titled “The construction productivity imperative”, the changes that need to be made in our industry are at the foundational level. Technology alone cannot fix the adversarial nature of contracts that has led us to prefer number fudging over transparent reporting. Until we start seeing more shared risk and reward contracts between design and construction firms, what’s the incentive to fix these broken supply-chain practices?

The construction industry is among the least digitized
The industry digitalization index chart below shows that the construction industry ranks just ahead of agriculture and hunting when it comes to adoption of digital practices. My wife is a digital media buyer for an advertising agency, and even she is frustrated at how slow the pace of adoption is in her industry (which is ranked #2). She has no room to talk.

The construction industry is also among the least funded
According to McKinsey, less than 1 percent of construction revenue is spent on research and development. Compare that with 3.5 to 4.5 percent in the auto and aerospace sectors and over 7 percent in financial!

There is an increasing shortage of skilled labor
In addition to our technology investment shortages, we’re also dealing with a shortage of skilled labor and supervisory staff. If you’re still worried that some robot is going to come along and steal your job, don’t. The value of design and construction professionals is now in their heads, not in their hands. How do we increase that knowledge to the power of data? McKinsey gives us five big ideas to start.

5 trends that will shape construction and capital projects

1. Higher-definition surveying and geolocation
The integration of BIM with robotic total stations (RTS) and laser scanners from hardware companies such as Leica or Trimble have been implemented for over a decade. However the decrease in technology cost has combined with an increase in demand for BIM to field reliability and created a new market adoption tipping point.

2. Next-generation 5D BIM
I have seen the amount of effort and planning required to implement truly 5D BIM for automated quantity reporting, production tracking and trend analysis during my 10-week research assignment with Consolidated Contractors Company (CCC) in Abu Dhabi, UAE. It was remarkable to learn the value that CCC places on integrated 5D BIM as a contract risk management tool rather than owner sales tactic.

3. Digital collaboration and mobility
Between BIM360, Bluebeam Studio, Procore, FieldLens, etc. you could argue there are too many tools available to collaborate with today. The challenge for project teams is not which tool to choose. It’s how to corral every team member into the same platform to exchange data in real time and maintain a reliable ‘single point of truth’ (SPOT).

4. Internet of Things (IOT) and Data Analytics
If every worker were to track themselves in order to produce automated timesheet and productivity reports, we could eliminate paper forms and capture data insights to reveal productivity or safety trends. The challenge today is incentivizing workers to want to be tracked and not feel like they’re being watched by ‘big brother’.

5. Future-proof design and construction
Future-proofing the design to construction process starts with trust between the digital and physical deliverables. Traditionally, architects and general contractors have fought over responsibility of the “contract design deliverable”. But when fingers start to point it’s the owner that ultimately loses. How do we gain trust in data to finally leverage it’s value?

Big Data is possible; but we can’t do it alone…
For owner’s using Integrated Project Delivery (IPD) or Design-Build contracts, I have an idea for how to address the issues we’ve seen with poor data quality. I would like to introduce a tri-party ‘Design-Document-Build’ contract. This approach recognizes that Architects and GCs are not always incentivized to ‘get along’, so why not give sole responsibility of the SPOT to a third party ‘Integration Manager’? Rather than giving a biased GC even more influence over the design, this unbiased yet incentivized partner plays the ‘checks and balances’ between biased designers and builders throughout the collaboration process from start of design coordination to operations handover.

Could Ridley be the answer?
I recently learned about Ridley, a specialist Executive Architect and Technology provider based in Sydney, Australia. They partner with Design Architects, General Contractors, and Developers here in the US to support the adoption of integrated design to construction handoffs. With Ridley’s background in international BIM requirements and their global time-zone efficiency, they are prime to be a perfect ‘Integration Manager’.

After meeting with their CEO and head of VDC, I am confident that Ridley brings a perspective and expertise in BIM that no local architect or GC could compete with. The search now is to find the right project owner ready to break the traditional mould and drive this level of disruptive process change. Are you ready? I know I am.

Nathan Wood consults to Ridley on our North American business strategy as well as providing insights and connections into the AEC technology space. Nathan has international experience with BIM, Lean, and Integrated Project Delivery (IPD). You can find more about him at his website