6 min read
The first three industrial revolutions were characterised by the introduction of:
- Steam-powered mechanical production,
- Mass production created by assembly lines, chemical fertilizers as well as urbanization,
- Computerisation and the advancement of digital technologies.
Currently we are in the fourth industrial revolution with great progress being made in: The Internet of Things (IoT), robotics, genetic engineering, artificial intelligence (AI) to name a few. Adapting business operations to assimilate industry progress will be a key driving force to sustained future growth, and success.
Sunset Silhouette Of A Security Guard @ Canva
The rate at which human knowledge advances has increased astronomically. Increasing the speed at which businesses, economies and the workforce face challenges. Various disciplines with corresponding types of knowledge have different growth rates, however being adaptable to a constantly changing environment is critical to all industries. In 1982 the “Knowledge Doubling Curve”, was created by Buckminster Fuller to showcase the ever increasing rate of new knowledge created by mankind. In 2013, David Russell Schilling from Industry Tap wrote an estimated example to explain the rate at which human knowledge is doubling. David stated “until the 1900s human knowledge doubled approximately every century, by the end of World War II knowledge was doubling every 25 years. Today, nanotechnology knowledge is doubling every two years and clinical knowledge every 18 months but on average human knowledge is doubling every 13 months. According to IBM, the build-out of the “internet of things” will lead to the doubling of knowledge every 12 hours.”
Productivity In A Digital World
The consequences of knowledge acceleration indicate an enormous need for companies to be adaptable and flexible to change. Industries are facing ever-changing environments marked by increased globalisation, new competitors and diversified consumer demand. Incorporating industry progress faster to stay relevant and competitive.
Businesses that assimilate digital innovation into corporate culture from senior management down to lower-level employees will be industry leaders. This new way of thinking will be even more critical as the adoption of new technology rate increases. Innovation is a continual cycle of discovery, development and implementation that enables businesses to invest into the next generation of industry progress. Laggards who are slow to enter into the process of continual improvement become outdated with faster, more adaptable competitors taking the lead on the next innovation curve. To reiterate, companies that are inflexible and averse to an innovative culture will become outdated, obsolete and replaced by more efficient rivals; as has been strongly evidenced by the Covid-19 pandemic.
Figure 1 – Recovery from February -October 2020. Data from: Office For National Statistics, 2020.
The impact of the Covid-19 pandemic on the construction industry is reflected with construction output remaining 6.4% below that of February 2020. Output grew by 1.0% in the month-on-month all work series for October 2020, with increases in both new work at 0.3% and repair and maintenance at 2.3%, making it the 6th consecutive month of growth but the smallest monthly increase during that time.
The 2020 Tech Nation Report confirmed the United Kingdom’s standing as Europe’s number 1 Tech Nation. With technological investment in the UK soaring by 44%, more than France and Germany combined. Globally Britain is 2nd in the world for fintech, while investment in this sector rose by 100% over the last year. In Europe, the UK is number 1 for emerging technologies and is 3rd in the world for tech unicorns, with 77 startup companies valued at over $1 billion. This highly innovative environment in the UK’s economy creates exceedingly competitive conditions for various industries, making continual productivity improvement critical to businesses.
It is worth noting that productivity has been listed as the greatest problem facing UK PLCs. What has the impact of productivity on the UK construction industry been? Graham Harle CEO of Gleeds Worldwide stated “Productivity deficit is not new. Sir Michael Latham highlighted this issue in the 1980s, Sir John Egan again echoed the view in his report Rethinking Construction in the 1990s, and latterly we have had Mark Farmer’s seminal work Modernise or Die saying the same thing.” The commonly echoed sentiment remains We build too slowly, too expensively and with too little reliability. Poor productivity in the construction industry is an area of major concern but also major opportunities. In 1971 to 2007 output per work hour for PLCs grew reliably with an average annual rate of around 2.3%. However, after the 2008/9 financial crisis output per hour worked has grown only 0.5% yearly, a substantial decrease despite the dramatic increase in digital productivity increasing solutions.
A lot of innovative solutions have been created within the construction industry globally. Among the top global innovations is the progress being made with 3D Printing. Such as printing composites, metals, concrete etcetera in more intricate designs making it possible to use 3D printing for houses, bridges and commercial buildings where speed and accuracy are essential. The benefits of 3D Printing include cost reduction, sustainability, and flexibility. Future uses of this technology could expand to address problems with labour shortages. Another area of interest is predictive analytics and machine learning which has become a vital tool of industry leaders. Predictive analytics alongside machine learning uses historical and current data to make predictions about future results. With construction project complexity ever-increasing the ability to manage risks, while taking advantage of opportunities grants a competitive advantage. The multinational BAM Ireland uses this technology on all projects, and has gained a 20% increase in on-site quality and safety as well as freeing up time by 25% to be spent on more high-risk issues. Advances in Virtual and Augmented Reality have enabled remote working, client review as well as opening massive opportunities for cross-departmental collaboration. Digital Twins have decreased the need for travel and aided remote working as well as allowing optimisation of building design, planning, and execution. Having a digital replication of physical bodies, future and current assets, systems, processes, workflows, data etcetera gives employees the opportunity of manipulating the design to reach optimal levels. Creating new efficiencies, better safety protocols and decreasing risks. This technology has also been used for Building Information Modeling – BIM. The impact of digital and technological innovation on the construction industry is indisputable despite the slow adoption of digital solutions, and innovation within the sector.
Incorporating digital solutions can solicit highly desirable results. Smartphones are increasingly being used onsite to collect and store information faster, with greater clarity and more conveniently than relying on paper. Site managers are able to receive information in real time without interrupting work progress or spending time searching for information. Artificial Intelligence – AI is being used to create optimal workflows on behalf of teams in the industry, where previously important data was often lost through inefficiencies and disconnectivity. Digital tools are providing support in some of the most key areas namely: communication, data, and transparency. Identifying, analyzing and mitigating risks for health and safety, contract compliance items, and generating real-time reports. The management of resources is a monumental task. Increasingly software management systems are being used to calculate the quantity of materials needed, lead-times, material costs, upfront, variable and fixed expenses etcetera. Having the knowledge of how much wiring or cement a project will need instantly increases productivity by saving time versus calculating these items by hand on paper. These systems also grant major advantages to workforce management by increasing communication, data availability, transparency, predictive tracking, forecasting, and mobile field solutions. Every company is responsible for supporting their workforce through training, development, and adequate adoption of improved working methods. When data is accurate, available in real-time and communication is streamlined, identifying problems is easier, faster as well as more avoidable. Connectivity and communication are critical. The more data, workflows, processes, and people connect the more productivity increases. In the construction industry this is especially true with specific workers or departments having unique knowledge (information silos) and paper based processes that are time consuming or impossible to distribute. Cross-departmental collaboration, communication and time-saving improves working conditions for everyone. Having real-time updates, relevant data, processes, workflows together on one unified platform is empowering for decision making and employee productivity. It creates better, faster, more effective decision making daily as well as long-term.
Productivity drives profitability therefore increases in labour productivity through efficient company systems, workflows, and exhausting digital potential should be a priority alongside incorporating digital innovation into business culture. Every company is responsible for its ability to evolve, adapt and grow along with industry developments. The time and opportunities are available now.
Headline image by: Blue Collar @ Unsplash – Christopher Burns