Construction Company (Confederatie Bouw) – October 2020
Four out of five construction and installation companies are working to digitize their operations. The main reasons they cite are working faster, centralizing information, and avoiding errors.
This is according to an online survey conducted by the software and services company Alistar.
The online survey was conducted from December 2019 to March 2020 by Alistar in collaboration with Microsoft BeLux. More than 120 business leaders responded to the questions. The results were presented as The Digital Barometer – Digitization at Construction and Installation Companies in Flanders – published by Alistar. You can find more information about the participants in these pie charts:
Productivity
You've probably read about it many times in the magazine Construction Company: In the construction sector, too, an increasing number of digital tools and technologies are becoming available: BIM, 3D printing, virtual reality, smart glasses, the Internet of Things (IoT), connected vehicles on the job site… In addition, there are applications that are more focused on business and project management: ERP, accounting, document management, project organization and monitoring, cost estimation, mobile applications on the construction site, and so on.
This is an interesting development, as productivity in the construction sector is a cause for concern. According to relatively recent figures, it is growing by roughly 1% per year, while in the manufacturing sector the rate is more than 3% (these figures do not take into account the impact of the COVID-19 crisis). The management and consulting firm McKinsey links this trend to computerization, automation, and digitization. According to McKinsey, the European construction industry is lagging behind in this regard. As a result, the sector is estimated to be missing out on €1.4 billion annually worldwide.
A few years ago, a study by the Confederation revealed that the majority of construction companies had not yet made much progress with digitization, although there were encouraging signs. What is the situation now? The study by Alistar sheds some light on the matter…
Positive Attitude
The survey contains good news: four out of five Flemish construction and installation companies are working on digitalization. However, it is a top priority for only one in three. The most frequently cited obstacles are limited budgets (49%), the small size of the company (49%), and a lack of necessary skills within the company (26%). 15% also indicates that the right profiles are lacking in the labor market as well.
What benefits do these companies see in digitization? “Being able to work faster” is the answer given by four out of five. Three-quarters mention the centralization of information, and 62% cites the reduction of errors. Other benefits mentioned include cost savings and improved (online) collaboration (both 46%) and, finally, going paperless (44%). It’s important to note, however, that not everyone is enthusiastic about what’s available on the market. One in five believes that digital tools are not yet fully developed.
Competition
Do construction and installation companies believe they are performing better than their competitors when it comes to digitalization? About half (53%) say they are, but a quarter (27%) admit they are lagging behind. The remaining 20% place themselves somewhere in the middle.
Looking at it another way, one could say that roughly half feel they are performing less well or barely better than their competitors. Alistar suggests an explanation: perhaps they are not (yet) taking the opportunity to review their existing business processes and better align them with one another.
This is because, at many companies, digitization stops after one or a few improvements, even though there is often still room to optimize and automate business processes.
