Disrupt the Construction Industry Through Pre-Fab, BIM, and AI

How prefab, artificial intelligence, and BIM can solve the labor shortage and productivity plateau

The construction industry is ripe for disruption – at most conferences around construction technology, this is a common theme. The large price tag behind each project, easily in the billions of dollars, coupled with a shortage of skilled labor and a declining productivity rate are clear indicators of opportunity, ready to be captured by those that can bear the risk of technology adoption. It seems like a very innocuous statement, but given the industry’s historical risk aversion, something that needs to be taken into consideration.

If you work in AEC, the labor shortage is no news, but here are some hard numbers anyway—The Associated General Contractors surveyed 2,500 of its members and found that 80% said they’re having difficulty filling hourly craft positions.  As for the declining productivity rate, the global construction sector just isn’t catching up with other sectors like manufacturing, retail, agriculture or economic growth in general. Stanford professor Paul Teicholz studied US construction productivity from 1964 to 2012 and found that productivity has been declining at roughly 0.32% per year.

Consulting firm McKinsey put it neatly in their report published last year, showing that for the amount of labor and capital put into construction, the output has lagged over the past 20 years, and “global need for infrastructure and housing will be hard to meet.”
Some people say reshaping the entire design to construction workflow will offer the biggest productivity boost, while others seek to overhaul the construction industry supply chain.  Makes sense to me, but these require some critical foundational advancements to be possible. These foundational advancements are: 3D/4D/5D BIM, Industrialized Construction (aka prefab), and Artificial Intelligence.

3D/4D/5D BIM
BIM is the central nervous system of modern construction projects. Using BIM, we digitize the entire project. With digitization, we offer many opportunities for today’s computing power to coordinate, plan, and deliver projects.  

Through the basic level of BIM, we can problem solve virtually and coordinate various building systems before actual construction. Then throwing the digital model into schedule simulators, we can visualize and optimize the schedule, while extracting cost and quantity information from the BIM can then be integrated into procurement and planning systems.

And since everything was digitally planned before the work is started in the field, the cost of rework is drastically reduced. This means higher productivity and reduced man hours.

BIM is an important first step to take before we can adopt other forms of technology to solve the industry’s biggest problems. Take prefabricated construction as an example–BIM can feed information to the factory, from managing the supply chain, to fine-tuning the design, to scheduling its on-site arrival.

Industrialized Construction (Prefab)
Taking a cue from how mass-produced, flat-pack furniture forever changed how everyday consumers furnish their homes since the midcentury, ready-made components for large construction projects can also really change how projects get done.

It’s also one of the best ways to tackle labor shortage, which is to learn to build with less labor. There’s a misconception, especially among building owners, that prefab building components are less sturdy and of overall poor quality. In reality, it is far from that, especially when the pre-fabrication takes place in a controlled environment with multiple quality control checks along the way.

Cash flowing into the pre-fab space from the VC community to companies like Katerra, FullStack Modular, Blox, Project Frog, and Bluhome is a promising sign that more stakeholders see the value this technology can bring to the construction industry and the public at large.

If you take a look at the semiconductor industry, much of the industry’s progress has come from advances in manufacturing – the secret sauce of Moore’s Law. Imagine the possibilities of advanced manufacturing delivering the built environment.

Artificial Intelligence
Industries from packaged food to retail are embracing artificial intelligence, letting machines predict, self-learn, deliver, and even create products that meet consumer preferences. In April this year, McKinsey reported that AEC is behind the curve in putting in place AI solutions.

Given the multiple variables involved in a construction project, and seemingly unique circumstances faced by Project Managers every single time, AI can in theory provide for a better and more robust decision making process.

But imagine a world where we can generate a complex project schedule with seemingly millions of moving pieces in a matter of minutes by just putting in a handful of reference data, and then link it to on-site sensors that can automatically ping relevant team members or modify a project schedule because of, say, a change of weather or maybe unsafe worker behavior on site.

The keyword here, however, is data, and the construction industry is still in the collection phase. Honestly, so much of industry knowledge is still “tribal knowledge” in the heads of our workforce. Intentional collective efforts to crowdsource and collect data will benefit the whole industry. These technologies are a no brainer when it comes to overcoming the two biggest challenges facing our industry today.