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02/10/2019

Construction 4.0 - Potentially the largest new site for the construction sector

Construction is one of the last sectors affected by digital disruption because of structural, social and political causes.

To tackle challenges of productivity, safety and “lifecycle ownership”, the sector will have to overcome these barriers and integrate the emergence of AI, digital platforms and immersive user experiences.

According to many studies during recent decades, digitalization offers undeniable potential for productivity gains in construction despite its low maturity.

A research led by the European Commission states that 81% of the construction industry players declare they are not ready for the advent of digitalisation. Along with with metallurgy, the construction sector has the lower part of its economic activity invested in digital transformation, which translates into a slow adoption pace of digital technologies : 31% of construction industries use data science, 14% use cloud technology and only 9.5% use 3D printing.

Less than € 7 bn of R&D investments were made for this purpose against almost € 100 bn for biotechnologies and pharmaceuticals. The sector of construction remains far behind on its digital transformation and seems to experience difficulties in solving its low digital maturity.

The European Commission also points out several reasons explaining why the potential of digital technologies is under-exploited in the construction industry.

First, the sector strongly depends on domestic growth because it relies on the volume of public command, the public-private partnerships context and the financial health of banks. There is a fragmentation of the responsibilities between the construction trades.

European companies also suffer from a low capacity to invest as 95% of them SMES, coupled with the fact that technical investments require to be massive per each construction site with difficult financial return. They lack of a direct relationship with their client’s needs. On top of that, more than one in three construction companies in Europe struggle to find the human resources needed to exploit the opportunities offered by the digital economy. About the same part of them sees the availability of novel technologies as a potential risk for their businesses.

Finally, construction companies’ investments in upskilling strategies are low. 50% of them state that they spend less than 5% of their annual revenues in reskilling. Thus, with a lack of staff training on the digital aspects of Construction 4.0, a profound change in the working methods is hard to set up among the employees.

The classic actors of the construction industry currently look like they are unable to solve the digitalisation barriers.

Despite those barriers and the aforementionned difficulties, construction companies tend to show a growing interest towards the digital technologies.

87% of them state that they have already seen positive outcomes through digital technologies, 91,3% of the business leaders say they are aware of their potential, and 9 out of 10 businesses in construction sector consider them as an opportunity.

Those figures tend to prove that the construction industry is ready to engage its digital transformation.