Predicting the future of construction and construction technology in these uncertain times is not easy. We’ve had the opportunity to work closely with many different types of contractors in many different regions over the past year, which has given us a unique view of what is changing in the industry. By combining these insights with both general industry and global pandemic-related trends, we feel that the future looks a bit clearer.
So here are our top construction and construction technology predictions for 2022:
1. Offsite work
Offsite work will continue to accelerate. This applies both to individual roles (such as preconstruction teams and VDC) as well as offsite operations – primarily prefabrication.
For contractors, construction has traditionally been very location-specific. The address of the project is where most of the activity took place, and most of the value was created. The last 2 decades have significantly changed this, primarily fueled by the uptake of BIM and VDC. Contractors are realizing significant value by creating a constructible model of their projects prior to (and during) construction by eliminating costly clashes, reducing design errors in the field, and enabling accurate prefabrication of assemblies and components in a controlled manufacturing environment.
The pandemic has accelerated the offsite trend with certain jobsites imposing COVID specific limits on access and people, many contractors looked to prefabrication as a solution to keeping projects on schedule. This, in turn, created a growing need for VDC professionals, and an increase in prefabrication capacity. Once these investments in people, process, and equipment have been made, contractors realize the benefits of offsite construction across all of their projects and the flywheel spins faster with more demand for VDC teams.
And as demand for VDC and BIM professionals increases, the new reality is that this type of work can largely be done 100% remotely. Combine this with BIM standards and software platforms becoming more standardized (e.g. the shift to REVIT), and we predict there will be significant changes to BIM teams in the near future, including:
- More geographically dispersed teams – across state lines and international borders, creating both opportunities and challenges for individuals, employers, and trade unions.
- Increased growth of BIM consulting firms (outsourced BIM) with existing firms like Sanveo, Viatechnik, BIM Designs, and VEC; and newer entrants such as Advanced Piping Design, Fused and Skywrite.
- A future opportunity for a gig work type of software platform specifically for BIM professionals, akin to a Fiverr or Upwork.
2. Pricing volatility
Pricing volatility will significantly impact projects. After months of trying to write off inflation as transitory, define new geopolitical relationships as passing, and supply chain challenges as temporary, the construction industry is now adapting to a new world of unstable prices and short-term vendor quotes. Gone are the days of quoting material during the bid phase of a project and expecting this pricing to be accurate 6 months later when it comes time to purchase.
This will change the way products are specified by architects by allowing for more flexibility in substitutions, more need for value engineering prior to and during construction (as pointed out by Join), impact how material price changes are accounted for in various contract structures (for example, GMP vs. Cost+), and create significant opportunities in the materials distribution and inventory management fields.
As offsite work increases – particularly prefabrication – many contractors will find themselves buying material earlier, and holding more inventory to support prefabrication of assemblies and components for active and future projects. As any experienced manufacturing organization will confirm, when material prices are volatile, profit margins are significantly impacted by inventory cost management. Simply buying coils of steel for a duct line as needed, or the same bundles of rod and Unistrut on a weekly basis for hanger assembly can lead to unexpected and considerable increases in the final cost of construction. While material cost management is very much a science in advanced manufacturing settings, these will be new skills for many contractors who have started prefabricating during a period of price stability.
We predict this will create significant opportunities for industry-specific inventory management solutions, and a continuing trend of manufacturing expertise being hired into construction.
3. Consumer tech
Consumer tech will continue to set expectations in the workplace, and this is going to be even more pronounced in the construction industry as the gap in personal tech vs. workplace tech is becoming more obvious.
Construction professionals of all ages are now used to getting deliveries at the push of a button, relying on cameras to passively monitor key information at their homes, and increasingly depend on multiple subscriptions to cloud software for all kinds of information and tools in their everyday lives. This will accelerate several trends:
- There has long been an obvious opportunity for someone to become ‘the Amazon for construction materials’, accessing multiple suppliers for pricing quotes, availability, and confirmed quick delivery. The construction technology industry has historically been slow to address this need, but we’re finally starting to see some new solutions tackling portions of this value proposition, such as Agora and StructShare.
However, the last mile logistics continue to be a challenge (just count how many distributor trucks you see with just a few boxes or a single pallet running to projects and fab shops each day).
We predict that industry-specific material purchasing solutions will continue to proliferate in 2022, and that there are significant opportunities for larger platforms (such as versions of Shopify and Deliverr) to enter the construction market.
- The adoption of home video tools is growing quickly, giving us real-time visuals into the current status of our front door, sleeping children, and backyard activities. But on construction sites, we’ve largely been flying blind. As the trend towards offsite construction continues, there’s an increasing need to have, for example, a “Ring Doorbell” in our mechanical room so BIM teams and fab shops can keep track of what’s being delivered and installed.
We predict new opportunities for intelligent notifications and alerts based on this image and video capture. “A person is at your front door” will be replaced with “level 4 concrete has been placed.”
- As our personal lives have become increasingly digital, the number of phone apps and software services we subscribe to and use each week is increasing. A decade ago many people predicted that there would be “one platform to rule them all”, this isn’t the case. We now have multiple apps and services in our personal lives that span communication, entertainment, finances, services, and information.
The same trend can be seen in construction, as contractors are realizing that the mythical “single source of truth” is unrealistic for the foreseeable future. Rather than trying to pick one single, perfect software platform (or waiting for the perfect platform to materialize before starting their digital journey), savvy contractors are building a “tech stack” that combines a range of different software to solve their most pressing problems.
With plenty of easy-to-adopt technology solutions entering the market such as photo and video capture solutions, cloud storage platforms, communication apps, tools to digitize field forms and visualize construction data, contractors can realize value quickly. However, these tools also create increasing data silos, thanks to a combination of digital and analog (paper) data, and interoperability issues. Even the simple task of keeping a set of construction plans up to date in each of these platforms can take hours per week.
We predict significant opportunities for companies that can quickly organize and bring intelligence to unstructured data from multiple sources and help contractors digitize their remaining paper processes.
4. Some things won’t change
Just as important as predicting what is going to change, we also think it’s important to leverage our industry knowledge to make a few predictions about what won’t change in 2022:
- Project schedules will not become longer.
- Skilled labor will not become more plentiful.
- Code and design requirements will not become more relaxed.
This list is not exhaustive of course, there is plenty of additional potential for change in our industry and we anticipate further exciting developments driven by robotics, VR/AR technology, and maybe even blockchain will make a comeback in construction! We will let others make predictions in those areas.
We have confidence in the construction industry’s agility and ability to adapt to change, and we’re optimistic about the future. In many ways, it seems that futurist William Gibson’s famous quote: “The future is already here, it is just not evenly distributed” increasingly applies to the construction industry. In the past two years alone we have seen contractors make amazing transformations to their businesses realizing new areas of growth and unprecedented profits. While the industry has traditionally struggled with inertia and a “we have always done it this way” mentality, these early adopters prove that real change is possible, and it can happen quickly when an entire company from leadership to apprentices is aligned on embracing the transformation.
We look forward to reviewing these predictions a year from now to keep ourselves honest, and are especially looking forward to another exciting year!