Industry Shift

 HOLLINGSWORTH 012018 will be a year of digital disruption in construction.   

By Chad Hollingsworth

There’s no denying construction’s impact on the U.S. economy. According to McKinsey Global Institute’s 2015 Industry Digitization Index, construction accounts for three percent of GDP share and five percent of employment share, yet it suffers negative productivity growth. This is due in large part to its status as the second least digitized U.S. industry. Unsurprisingly, industries with the highest rates of digitization experience the greatest productivity growth, and unlike advanced manufacturing or utilities, for example, construction has been slow to adopt the digital tools that have automated processes and unlocked efficiency in other industries.


In the last 12 months, however, construction has undergone a transformation, as increased building activity, growing attention on our nation’s infrastructure, and record investment shifted the industry’s image, priorities and approach. Amidst the skilled labor shortage, contractors are turning to new technologies to optimize their current workforce and meet demand with the same – or fewer – resources. In this new year, jobsite technology will be the norm, as contractors embrace digital to stay competitive, and project leaders, crews and risk managers come to expect real-time data at the worksite.

The Growth of IoT

New construction-focused, Internet-connected solutions are automatically collecting previously unattainable – or economically impractical – data from workers, equipment, materials, tools and the environment. In 2018, there will be fewer paper documents, such as blueprints or daily safety logs, as error-prone, manual methods are eliminated in favor of streamlined digital processes. 

Also, as more construction technologies hit the market, and smart devices continue to dominate daily life, consumer tech experiences will increasingly shape enterprise tech solutions. In 2018, the consumerization of construction technology will shift power to end users, who will expect solutions that are streamlined, intuitive and user-friendly.  

While these types of technologies have not been readily available in the complex and physically challenging construction environment until now, today the development of practical, scalable and actionable solutions has become a priority. Instead of using separate solutions for design, estimating, bidding and scheduling, for example, contractors will demand a single source of real-time information, and hardware and software companies will join forces to provide these capabilities.  

Emerging tech systems are playing a major role in shaping the way leading industry stakeholders plan projects, manage daily operations and leverage historical data for future jobs. Moving forward, a solution’s ability to aggregate various data – at scale – will be a key differentiator.

Leveraging the Data

As the rate of technological advancement and adoption increases, the digital divide between those who embrace jobsite technology and those who do not will widen. For project teams, contractors, owners/developers and insurers, a lack of real-time data will become a larger competitive disadvantage. Clients want quality, cost-efficient projects grounded in cutting-edge methods and technologies, and they will increasingly demand real-time progress reports and data-driven updates. 

While project participants currently spend roughly 80 percent of their time collecting data and only 20 percent of their time leveraging it, this ratio will shift in 2018 as IoT-enabled solutions, such as wearables and sensors, automatically collect valuable jobsite data. With this plethora of new data, the ease and capabilities of custom dashboards and reports will take center stage. 

Emerging tools such as artificial intelligence (AI), machine learning and predictive analytics also are receiving a lot of attention – and for good reason. They provide the opportunity to increase productivity and profitability at the jobsite, and data mining and predictive analytics will hold the key to driving the industry towards a more efficient future.

Insurers Join the Data Bandwagon

Everyone involved in the industry will benefit from the explosion of data, and it will particularly be valuable for the insurance industry, which will use it to assess – and reduce – operational and safety risks, as well as associated costs. As technology connects the jobsite, insurers will gain increased visibility into worker activity, asset utilization, overall compliance and incident rates by trade, sub or incident type. 

Each contractor has its own risk management culture and initiatives impacting incident exposure and frequency, and insurers will benefit from real-time, real-world data into these measures. In the long run, the only way to lower the total cost of risk (TCOR) is to lower the frequency and severity of claims that drive insurance premiums – and the indirect costs that accompany an incident. By working together, contractors, risk managers and insurers can harness data to identify and correct risky behaviors before an accident occurs, improve safety protocols, combat potentially fraudulent claims and ultimately lower premiums. 

Looking Ahead

Looking back, 2017 was the year that the renewed focus on infrastructure, increased construction activity and skilled labor shortage forced contractors to take stock, identify weaknesses and figure out how best to optimize resources to meet demand. 

In the last year, the conversation shifted from “We need tech” to “What are the best solutions and how can they be leveraged?” And as project leaders and participants better understand and leverage IoT at the jobsite, cloud computing, big data and predictive analytics will more firmly take hold in 2018, creating a year of digital disruption. 

Chad Hollingsworth, CEO of Triax Technologies, co-founded the company to bring effective, innovative technology to challenging environments. Through its flagship Spot-r system, Triax provides real-time visibility into workers, equipment and safety on site, resulting in increased operational efficiency, faster response to injuries and overall improved project management. He can be reached on LinkedIn or by email at [email protected]


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