The findings of phase one of an ICE-commissioned review, following a number of high-profile infrastructure projects suffering from severe delays and spiralling costs, made for grim reading for the industry.
In the report, Andrew McNaughton, chair of the Review Steering Group, warned that “it is abundantly clear that continuing as we are is not an option.”
The report amounts to a rallying cry for the sector which, according to the Committee for European Construction Equipment (CECE) is one of the world’s least digitised sectors, particularly in Europe.
The massive variety of requirements across different projects, limited budgets, and remote nature of projects present challenges around implementing digital technology at scale. However, the huge number of stakeholders, from estimators, to contractors, to designers, mean that the speed of digital transformation must increase for the industry to keep pace with demand.
Systems thinking must be at the heart of this rapid evolution of technology, particularly for large scale infrastructure projects.
The importance of systems thinking
As Andrew McNaughton states in his report it is systems, which are often automated, interdependent, and reliant on technology, rather than structures, which provide the services such as mobility, sanitation, and energy we all rely on.
Increasingly, major new or expanded infrastructure services, such as transport or clean energy, are delivered by complex projects bringing together physical assets, technology, and digital information such as a Building Information Model (BIM) or a digital twin.
While these new technologies are enabling new possibilities to improve the delivery and operation of infrastructure, the leadership and delivery model lags behind the evolution, with traditionally trained engineers continuing to use established construction methods. This means that projects are often delivered beyond schedule and far exceeding the costs estimate.
Instead, the industry should be putting high-quality, up to the minute data at the heart of projects, enabling a more agile leadership to control complex projects.
Controlling costs in construction
According to the Office for National Statistics (ONS), the number of construction firms reporting higher than normal cost increases hit a new high. More than two in five (44 percent) firms surveyed said they had seen their costs rise more than normal.
Imported materials, which make up a quarter of all materials used by the UK construction industry, have seen the biggest price increases, with imported timber and steel seeing double digit inflation. Material shortages are also compounding the problem and pushes prices even higher. The Construction Leadership Council lists steel, timber, cement, aggregates, plastics, and roof tiles as facing supply constraints.
Given the ongoing volatility in the materials market, which is expected to last into next year, it is vital that budgets for infrastructure projects are closely monitored to avoid costs spiralling out of control.
Data will be central to the sector overcoming ongoing economic uncertainty, with the increased visibility and agility offered by digital technologies helping to inform decision making and track all costs associated with a large-scale infrastructure project.
Without a robust, fully digitised cost value reconciliation (CVR) process in place, projects risk overspending or under recovery. Tracking CVR through innovative software means project teams can easily track monthly expenditure and revenue, and finance directors are kept abreast of project cash flow forecasting.
Read our latest article - Handling material shortages in Construction with cost value reconciliation
Intelligent analytics
As management teams face ever-increasing complexity, not to mention ongoing cost and materials disruption, access to accurate, up to date information is critical to inform smart decision making.
The ICE report into systems thinking concluded that a ‘golden loop’ of high-quality digital information was at the heart of its recommendations - Construction management software
Enabling data-driven planning, project delivery and asset management, with data flowing through the asset’s lifecycle and back into future planning, is essential to create a new generation of future-proofed infrastructure.
While long-term conversations around a common approach to the collection, storage, and exchange of data across the construction supply chain will continue, there are micro steps that can be taken now to ensure that businesses feel the full benefit of this information flow.
The use of dashboards provides full visibility of trends, based on actual and real-time data, giving the business an accurate and up-to-date representation of a project. Producing weekly and monthly reports will help to raise any concerning trends, and real-time information can prevent over-spend.
The use of mobile apps also means that staff working on-site can instantly view or submit key data to the enterprise resource planning (ERP) and finance system, rather than waiting until they are back in the office. With market forces changing rapidly, this speeds up the process and minimises any chance of error or confusion.
As the industry seeks to develop a pipeline of engineers and management which can thrive in technology-driven environments, this is a long-term shift in skills and experience.
In the meantime, the tried and tested engineers and construction methods will be vital to keep projects on track. By providing user-friendly solutions to teams on-site and in head office, the industry can help to bridge the gap between a tech-led, full systems integration and antiquated methods of project management dominated by spreadsheets and even paper-based systems.
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Major infrastructure projects are at the heart of Government plans to build back from Covid-19 and this presents huge opportunities for the civil engineering and construction sectors, with huge transport and energy projects, such as HS2, just the tip of the iceberg.
Despite the huge opportunities, it is clear that the current delivery model for complex infrastructure projects is at risk of perpetuating long-term completion delays and spiralling costs. These challenges can be avoided, however, if the sector takes inspiration from other sectors by embracing construction software and moving towards a systems approach.
Software for construction management
Our construction management software covers everything from construction estimating software and job costing, to accounting software, HR and plant and asset management. We have mobile apps that captured data in real-time, and dashboards that analysis and report back to your business in one place.
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