Construction Ripe for Disruption
November 29, 2017
majority of U.S. construction executives, 72 percent, believe that the
construction industry has not reached an acceptable level of performance
in the delivery of capital projects. However, 92 percent of U.S.
construction executives believe that technology will fundamentally
change their businesses, and help them bridge the performance gap,
according to KPMG's Make it, or break it – Global Construction Survey
"Engineering and construction companies in the U.S. and globally need to
take significant steps in improving performance to align to
stakeholders' expectations," said Geno Armstrong, International Sector
Leader, Engineering & Construction, KPMG LLP. "The industry is ripe for
disruption, but only those who have invested in the right technologies
and controls will be able to rapidly achieve massive uplifts in
The report highlights the views of 201 global senior executives from
major project owners and engineering and construction companies, 61 of
which were U.S.-based.
Implementing New Technologies and Aligning Digital & Business Strategies
Fifty percent of U.S. survey participants said that technology will
change their business over the next two to three years, compared to 47
percent globally. Asked if their organizations have developed
data/technology strategies or road maps, slightly more than 50 percent
of the U.S. and global participants said they had not.
Regarding the technologies that will deliver the greatest overall return
on investment, U.S. executives most frequently cited: 'integrated
project management information systems' (PMIS) at 68 percent, 'building
information modeling' at 53 percent, and 'use of advanced data
analytics' at 48 percent.
"There are obvious cost and performance benefits associated with
leveraging technology, but we also expect the change will attract the
next generation of the industry's workforce," added Armstrong.
Changing Workforce Demographics and Adapting New Controls
The KPMG survey indicated that millennials make up 30.1 percent of the
U.S. construction workforce and 40 percent of the global workforce,
closing in on U.S. baby boomers who comprise 30.4 percent of the
workforce, and exceeding the global baby boomers at 23 percent.
to the survey, millennials feel constrained by the traditional, rigid,
impersonal, 'hard', technical project controls currently in place in the
construction industry. As a result, 52 percent of U.S. survey
participants indicated that they are formalizing 'soft' controls –
ensuring that all staff is clear about their roles, can raise issues or
concerns, are confident they will be listened to, and, ultimately,
embody the right values – as part of their project delivery services to
meet the needs of the increasing millennial workforce.
"It's not just about improving the three drivers of governance, people
and technology, but also addressing missing linkages between them,"
added Armstrong. "Standardization and optimization are worthy goals, but
on their own are unlikely to narrow the performance gap. Future success
is dependent upon rationalizing the rule books, creating truly
integrated digital strategies, and nurturing a workforce and culture
that embrace new technologies."