Increasing productivity with innovation

Technology and construction have traditionally made for uncomfortable bedfellows. The construction industry has been an analogue-driven sector where paper-based systems have been the preferred method of recording. The industry is suffering, with UK productivity estimated to have fallen 20% since the global financial crisis. 

There are a number of challenges facing the construction sector that have a negative impact on productivity:

• Fragmented structure of the sector – only a very small number of the total workforce (around 5%) are employed by the main contractors. The rest of the market is made up of sub-contractors and specialist firms. This structure is different to any other industry where a larger proportion of the workforce is employed directly by the key players.
• Low profit margins – typically, projects run on a very tight margin but without the same kind of project management controls, meaning that projects will frequently run over time. This incurs significant penalties and additional labour costs.
• Reluctance to invest – in either new equipment or new technology. Instead, firms invest in more people with lower skills as people are easier to offload in an economic crisis.
• Brexit and skills shortage – if EU workers can no longer be drawn upon then the industry needs better digital solutions to fill the gap. The industry is perceived as being unattractive to the more digitally savvy workforce due to its lack of technological investment.

However, there is some good news within these challenges. The UK Government has pledged £170m to the ‘Transforming Construction’ programme, which will be matched by private industry. The solutions that are currently being worked on are all focused on digitising the construction industry to leverage innovations such as artificial intelligence, automation, mobile devices and the Internet of Things. These solutions will help to transform the supply chain and put the power back in the hands of the main contractor to enable smooth running of projects to a set budget within an agreed timeframe thus increasing productivity of the industry.

The digital construction solutions that are being developed could help to lift productivity, saving the industry billions of pounds and creating collaborative project delivery, where both main contractors and sub-contractors stand to share the gains.

One of the digital solutions that is helping move the industry forward is the increasing use of biometrics on construction sites. The introduction of this technology and the software that sits behind it can provide real time project management information, giving insight across multiple projects and integrating with existing systems to ensure the smooth transition from a paper-based system to something that is more technologically savvy.

If the industry is serious about increasing productivity and tackling the challenges of a fragmented and aging workforce, it needs to embrace digital construction. The knock on effect will enhance the appeal of this industry to a younger and more dynamic workforce, improve competitiveness between major contractors and streamline a market sector that has been waiting to be dragged into the 21^st century.

Nick Wilkinson is head of workforce management solutions, construction, at Human Recognition Systems