The construction industry has been slow to digitize, and it’s missing significant growth opportunities
How Innovation Saves Lives
Since the beginning of the COVID-19 pandemic, the race for a vaccine has been on everyone’s mind. Now, almost a year later, we finally have one…but it isn’t reaching the communities who need it quickly enough.
So, why has vaccine rollout been slower than expected? One surprising factor is insufficient infrastructure. Pharmaceutical manufacturers are rushing to expand existing factories and build new ones, but these construction projects take time. Worse, they’re notoriously inefficient; research suggests that over 70% of pharmaceutical construction projects exceed their budgets and run overtime.
With lives on the line, it’s clear that something needs to change. And that something may be construction leaders’ investment in innovation, as we unpack below.
Huge Opportunities for Construction
Despite housing huge potential for innovation, construction has been slow to adopt new technologies. Research by McKinsey & Company shows that “the construction industry is among the least digitized,” and companies are missing opportunities as a result.
According to McKinsey, large construction projects “typically take 20 percent longer to finish than scheduled and are up to 80 percent over budget.” This lack of efficiency has slowed industry growth; the construction sector is growing sluggishly (1 percent per year) compared to other industries, like manufacturing (more than 3 percent per year).
Fortunately, there is an innovative solution to this stagnation: artificial intelligence (AI).
Projections based on global GDP growth estimate that at least $57 trillion will be spent on building infrastructure worldwide between now and 2030. AI can help construction companies maximize productivity and minimize costs, creating the efficiency needed to meet this colossal demand.
Recently, we spoke with several leaders in the construction industry. This article explores some of the biggest goals they hope to achieve and the pain points that keep them up at night. Finally, we also discuss the existing and accessible AI solutions that can help them address these challenges.
What Construction Leaders Want to Achieve
In our conversations, two primary areas of concern have been very much top-of-mind:
1. Efficiency. Several variables feed into efficiency, including material use, scheduling, and equipment. The bottom line is this: an efficient construction company accomplishes its projects to a high degree of quality while consuming the minimum amount of time and resources, including labor. Construction makes its money on razor-thin margins, so efficiency is paramount.
- Generate more profit (because they cost less)
- Create less waste
- Help construction companies build a stronger reputation – or maintain the reputation they already have.
2. Contract compliance. Sixty percent of general contractors see “issues with the quality of contract documents as the key contributors to decreased labor productivity.” This perception may be due to the sheer volume of text in said contracts—not to mention the risk they pose to construction companies.
In fact, AI can help construction leaders unlock massive innovations for both efficiency and contract compliance. We elaborate on these benefits below (in AI solutions). But first, we’ll explore some of the pain points that stop construction companies from reaching their desired outcomes.
Specific Pain Points to Address
Of course, no two construction companies face exactly the same pain points. However, we have learned that the following three areas of concern are found across the industry, whether the firm specializes in commercial, residential, or infrastructure projects:
1. Safety. Construction often necessitates work with dangerous materials or heavy machinery. In some cases, the environment itself may be hazardous—anything from a cliffside site to a perilously high-elevation skyscraper scaffolding.
Construction companies can safeguard their employees with personal protective equipment (PPE) and safety regulations. However, it’s challenging to ensure that every employee follows the proper guidelines 24/7—and accidents that slip through the cracks generate a high cost in injuries, deaths, and liabilities.
2. Security. Petty thieves steal 10-25 percent of supplies on large-scale construction sites every year. Additionally, some corporate agents engage in a practice called “corporate espionage”: invading and lifting proprietary information from rivals’ worksites.
Hired security can somewhat deter theft and espionage—but they can be expensive and human error is a given. Without technological assistance, a human (or even a team of humans) can’t provide security coverage 24/7.
3. Productivity. Even the simplest construction projects require multiple crews, each with its own specialization. This can create scheduling issues, especially if crews must work in a specific order; it is difficult to predict precisely when one crew will finish so the next can start. This has become even more challenging during the pandemic, with social distancing and additional inconveniences.
Project managers can make their best estimate, but imperfect scheduling may steal dozens to hundreds of hours over the course of a project. This and other predictive errors (buying excess materials, under-or overestimating cost, etc.) make productivity a significant pain point for construction.
AI Solutions & How They Shine
1. Machine vision for remote security.: “Machine vision” is an AI application composed of both hardware and software. The hardware aspect—usually a set of cameras—acts like a super-powerful eye, “seeing” everything around it. The software aspect—where AI enters the picture—analyzes this visual data to make it useful.
Machine vision has applications for safety, security, and productivity.
For starters, it makes for an incredible security system—enabling remote, automated surveillance. Imagine a worksite that covers several acres of land. It would be a challenge for a security team to cover that much ground—but not for AI. A single machine vision system (with many cameras) can oversee the entire site and alert a human security agent when it registers an intruder.
Machine vision can also promote safety by monitoring for potential hazards. If employees aren’t wearing the proper PPE or equipment is stored or handled hazardously, it can recognize this risk and alert a supervisor.
Finally, machine vision can perform tasks to aid productivity. For example, it can alert supervisors automatically when a crew finishes and moves on from an area of the worksite, facilitating more efficient scheduling.
2. Intelligent design for future project blueprints: When designing the blueprint for a future project, there are countless iterations to consider. For example, What rooms should go where? What materials are the best for this room and that room? How much will it all cost?
AI can answer these questions and more.
“Intelligent design” is an AI application that takes advantage of AI’s rapid computing and data analysis abilities. Typically, it entails the following steps:
- The AI accepts a set of input parameters. These may include the desired dimensions of the project being designed, the budget, the available materials, contract compliance requirements, et cetera.
- The AI considers every possible design for the project.
- The AI determines which design is optimal. What “optimal” means will vary between projects, but often it is the design most likely to satisfy the client with the lowest cost to the contractor.
To summarize, intelligent design can produce an optimal blueprint with more speed and accuracy than human designers could achieve working alone.
This of course does not replace humans on the job – but just imagine if your current team had an extra set of “AI superpowers” in their toolkit?
3. Data analytics. “Predictive analytics” use data, statistical algorithms, and machine learning (AI) to identify the likelihood of future outcomes based on historical data. A predictive analytics system can optimize scheduling by forecasting exactly when a certain crew will finish a certain task. This and other applications like weather and tectonic forecasting can raise productivity.
Synaptiq recently worked with a large client to build a predictive model to anticipate which elements of a given construction project would have the most impact on its overall profitability. Our AI solution now empowers this client to proactively address issues long before they impact cost and schedule, raising efficiency and profit.
If you are a construction company looking to understand and leverage AI, Synaptiq can help. We typically begin our engagements with low-cost, proof-of-concept projects, to better understand the data you currently have, and how you can best use it to your advantage – which, ultimately, will help you learn whether AI is the right tool for your organization.
For proof of our successful track record, check out our case study catalog, which includes work with clients in the construction industry.
We look forward to hearing from you.