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The construction industry historically has been a slow adopter of technology and digitization, but the COVID-19 crisis could force it to change more rapidly, according to a report from management consulting firm McKinsey & Company.
The report, titled “How construction can emerge stronger after Coronavirus,” outlines several short-term trends that should come out of the pandemic, including increased digitization and supply chains that are geared toward resilience over efficiency as contractors are building inventory, securing critical materials and long-lead items, and identifying alternative suppliers.
On the digitization front, organizations have already increased remote work activities, and collaboration tools such as building information modeling (BIM) are being utilized more. McKinsey also points out that contractors “are looking to online channels for monitoring their employees’ well-being through apps, ordering construction materials, managing scarce resources more accurately and maintaining cash flow.”
As for longer-term trends, McKinsey notes the construction industry will be more likely to adopt augmented consolidation, vertical integration, further investment in digital tools and an increase in off-site construction.
“Industry players are already starting to vertically integrate to increase efficiency and as a route to standardization and control of design and execution,” the report states. “In a post-crisis world, vertical integration (which may include a return to greater reliance on direct labor) is a potential route to greater resilience.”
McKinsey points out that physical-distancing measures and restrictions on movement across borders may exacerbate the ongoing skilled labor shortage. This could drive automation in various areas of design and construction, and digital tools may need to be adopted in order to increase productivity.
Off-site fabrication, which is already prevalent in the installation of glazing systems, should also increase in the long-term.
“Building in controlled environments makes even more sense in a world that requires close management of the movement and interaction of workforces,” McKinsey’s experts note. “Such rationale further strengthens the case for off-site construction, beyond the existing quality and speed benefits. In fact, we expect to see contractors gradually push fabrication off-site and manufacturers expand their range of prefabricated subassemblies.”
Read the full report here.
This is a good thing for building relationships with clients around the United States and world. It’s a good thing to relate to someone by phone, but even better by video conference. I think the construction industry will be MUCH stronger.