It does not serve any purpose to discuss, whether disruption in construction will happen or not, the question is whether this will happen from the inside or the outside!

We RIB take a more industrialised approach to the transformation, in many ways inspired by how SAP in the late 90's served as a technology partner to the digital transformation of Automotive, leaving the industry completely transformed and consolidated.

So, inside vs. outside disruption you say? Yes, working with companies like Siemens, Bosch, Airbus; owners like Georgia Tech, Deutche Bahn, P&G and world leading telecom company T, tech companies like Microsoft, Google and Apple, we see already industrialised and digitalised companies with interfaces to construction, already making step-changes and off-setting the balance within the boundaries of classical construction.

Apple Engineering is directly driving the design and execution of new campuses, enforcing more integrated ways of working. Google have a highly engineered approach to replicating objects and processes that actually WORK and eliminate stuff that does not. And to give an example from a non-RIB customer, Toyota is building SMART homes for the growing elder population due to the imbalance in generation, digital solutions must alleviate this potentially productivity deteriorating situation, but for Toyota it is simply technology which just happens to sit in concrete.

When meeting industrial leaders from manufacturing and advanced manufacturing, I increasingly find leading indicators to what is happening in construction, and inspiration to the changes we must make in our way of working and thinking in order to transform. Transform is a word I very deliberately use, since change is small and often incremental, but can support an overall transformation. Transformation is like when the caterpillar transforms into a butterfly, it cannot go back and reaches its full potential and purpose.

Similarly, transformation like seen in automotive and manufacturing requires leadership to challenge the status quo, pursuit value creation rathe then risk distribution and find the right vehicle for this transformation either inside the company, or fund initiatives outside to drive this agenda.

Consolidations are already happening on a global scale. YIT and Lemminkainen is now YIT Group, BAM Group is growing, Engineering firms are acquiring design companies, and companies like Katerra have based on a $835M funding acquired a full value chain to be a fully integrated design contractor. Thus, if leadership is not discussing this rigorously we are not leading but letting happen.

So, let’s break down some of the collective and comparable insights from peripheral industries in construction and follow McKinsey’s trail of thought on the value creation.

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Reshape regulation and raise transparency.

Actions include streamlining permitting and approvals processes, as Australia has done; reducing informality and corruption; and encouraging transparency on cost and performance, as the International Construction Measurement Standards project does. The UK will shortly mandate BIM level III, which essentially means integrated BIM throughout the full work stream and across all stakeholders.

Many governments allocate grants for innovation and training. Germany’s Federal Ministry of Transport and Digital Infrastructure (formerly the Federal Ministry of Transport, Building, and Urban Development), for instance, supports R&D through studies in building materials. Best-practice regulation would include moving toward outcome-based, more standardized building codes, and consolidating land to promote scale. Examples include Singapore’s move to allow cross-laminated timber (CLT) for high-rise structures and Japan’s promotion of scale through land pooling.

Rewire the contractual framework.

There is a need to move away from the hostile contracting environment that characterizes many construction projects to a system focused on collaboration and problem solving. To achieve this, tendering processes can be based on best value and past performance rather than cost alone, and public processes streamlined. Establishing a “single source of truth” on projects for monitoring progress early, potentially supported by collaborative technology, helps to minimize misalignments and enable joint corrective action. The data already exist to fundamentally improve the accuracy of cost and schedule estimates. Where players continue to use traditional contracts, they should introduce incentives that significantly improve performance and alignment not at a trade or package level, but at the project-outcome level. To move toward best practices, appropriate alternative contracting models such as integrated project delivery (IPD) help build long-term collaborative relationships. Relational contracts will need to become more prevalent than transactional contracts. Sufficient investments in up-front planning incorporating all parties’ input have been shown to raise productivity substantially. If not keep on IPD, BLC offers courses in the subjet in Copenhagen and same with CIFE at Stanford University.

Rethink design and engineering processes.

Institutionalizing value engineering into the design process with a greater focus on constructability, and pushing for repeatable design elements in those projects that do not require bespoke solutions would make a contribution to boosting productivity. The biggest impact on productivity would come from moving toward thinking about construction as a production system, where possible encouraging off-site manufacture, minimizing on-site construction through the extensive use of pre-cast technology, assembling panels in factories and then finishing units on-site. To indicate the scale of the opportunity, only 50 percent of respondents to the MGI Construction Productivity Survey said that their firms had a standard design library.The automobile and aerospace industries provide insight into how tighter integration with contractors might evolve.

Improve procurement and supply-chain management.

A combination of best practices seen in other industries and innovative, digitally enabled approaches can deliver substantial change. Improved planning and increased transparency among contractors and suppliers would reduce delays significantly. Properly skilled central procurement teams can drive economies of scale for certain products across those sites. Best practice in areas such as digitizing procurement and supply-chain workflows will enable more sophisticated logistics management and just-in-time delivery. Katerra, for instance, recently launched a data-enhanced global sourcing model to help develop a supply chain that reacts to potential disruptions and market dynamics with predictive replenishment of supplies informed by inventories connected to the Internet of Things (such as wearable devices, radio frequency ID tags, and sensor technology). The construction sector ranks in the lower range of sophistication in the Global Purchasing Excellence Survey published by McKinsey’s Procurement Practice, suggesting ample room for improvement. Also RIB and Flex have a UBER like supply chain concept called YTWO connecting supply and demand based on the demand visibility 5D BIM technology can create, producting a fully integrated value chain, efficiencies, risk reduction and lower prices.

Improve on-site execution.

There are four key approaches that are well known in the industry but have not been universally adopted. First is the introduction of a rigorous planning process—the Last Planner® System (LPS) is a useful tool—to ensure that key activities are achieved on time and on budget. Getting real-time financial feedback on actual progress gives project managers the ability to act proactively instead of reactive when issues have snowballed. Here integrated technology fills an pinicle role and loosly coupled and stand-alone tools re-inforce the spathetti IT architecture, that simply does not scale and re-inforces the low-productivity environment rather than breaking away from it.

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 The use of integrated planning

tools on a large-scale oil and gas project, for instance, achieved a 70 percent increase in the project’s productivity. Second is reshaping the relationship and interactions between owners and contractors, and key performance indicators (KPIs) being agreed on and used at regular performance meetings at which on-site issues are resolved. Complementing commonly used KPIs with additional forward-looking plan conformance metrics to identify, and subsequently reduce, variance is critical. Third is improving the mobilization for new projects by ensuring that all pre-work (for instance, obtaining approvals and developing project milestones) has been completed prior to starting on-site. Finally, there is a need for careful planning and coordination of different disciplines on-site along with the application of lean principles to reduce waste and variability. At the heart of this issue is a need to move from systems that rely primarily on process and command-and-control toward a more holistic operating system. The sheer complexity and variability of today’s megaprojects require a project-operating approach that integrates technical and management systems and fully harnesses workers’ capabilities.

In the future, new forms of digital collaboration, notably the Internet of Things and advanced analysis, will combine to enable tracking of equipment and materials and therefore, greater transparency. Don’t just think linear, think in locations! Linear planning will never solve the location-based conflicts with crews doing work in the same location, which is a big source to waste and rework. Location based planning (LOB or Flow lines) will alliviate this and having proven a supperiour addition to LPS planning. Integrated planning in construciton emphasises the need for planning to be integrated with design and costs, as well as resources and the stakeholders across the value chain. This is not a silo, but an integrated data- value, and work stream.

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Infuse digital technology, new materials, and advanced automation.

Companies can start by making 3D building information modelling (BIM) universal within the company alongside use of digital collaboration tools, drones, and unmanned aerial vehicles for scanning, monitoring, and mapping. They can put themselves at the cutting edge by using platforms such as 5D BIM to establish transparency in design, costing, and progress visualization; advanced analytics enabled by the Internet of Things to improve on-site monitoring of materials, labor, and equipment productivity; and digital collaboration and mobility tools (such as construction management apps loaded on mobile devices) to better track progress and collaborate in real time. On-site productivity can be increased by as much as 50 percent by implementing a cloud-based control tower that rapidly assembles accurate data in near real time that is both backward-looking and predictive (for example, using plan conformance and other variability and inventory metrics). Importantly, owners need to ensure that the right data flow through the various owner, contractor, and subcontractor systems. Big data also has a significant role to play. Techniques and data that are readily available today can produce large improvements in the accuracy of cost and schedule estimates as well as engineering productivity. Developing new lightweight materials and construction methodologies such as prefabricated pre-finished volumetric construction can further facilitate off-site fabrication. Advanced automated equipment and tools such as bricklaying and tiling robots can accelerate on-site execution. The introduction of predictive analytics and pattern recognition has enabled far more sophisticated monitoring of construction projects; one example is the network of sensors installed to track the impact of tunneling works for London’s Crossrail project. MGI’s productivity survey indicated that the biggest barriers to innovation by construction companies are underinvestment in IT and technology more broadly, and a lack of R&D processes. Establishing innovation officers can make a difference for technology adoption.

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Ingtegrated BIM or 5D BIM proves to have an extreme impact based on the leading indicators from manufactoring and automotive, in it's sheer capability to be silo-slashing and foster collaboration and transparency across the value chain.

Reskill the workforce.

Change in the construction sector cannot be achieved without investment in retooling a workforce that is aging and changing its makeup through migration. Construction firms and workers need to continuously reskill and train to use the latest equipment and digital tools. In the mix should be apprenticeship programs such as the one run by Siemens in the United Kingdom, training frontline workers in core skills that are currently underdeveloped; and increasing stability in the workforce by breaking seasonality and cyclicality. Many opportunities here emerge, and a have been pointed out in several reports from the EU the investments in training and education of the workforce in construction is significantly less than in other industries, why organisation like x.0 Industries, EY Digital, BLC and CIFE are offering support on these topics.

We dare to do differently. In the words of Einstein madness is doing the same thing over and over again, and expect a different outcome. By no means to we intend to replicate this, rather create repeatability and scalability of what works, and elimination of what does not.

As a source of inspiration, have a look at our customer and Technology Partner Züblin to the way they work with 5D BIM:


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  Anne Simone Nielsen  Marketing Assistent

Anne Simone Nielsen
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  Mads Bording  Executive Board Member

Mads Bording
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  Louise Dahlerup   MarCom Manager

Louise Dahlerup 
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