Australia’s construction sector is set for disruption which will see growing volumes of data being used to drive better decision making, a leader in the technology sector says.
Speaking at his company’s recent Construction Technology Summit held in Melbourne, Rob Phillpot, Global Vice President, Product Strategy, Oracle Construction and Engineering, said the building sector in Australia has opportunities to improve productivity through greater adoption of industrialised practices and more use of data in making decisions.
According to Phillpot, construction today faces similar challenges to those seen in manufacturing over recent decades. These include growing complexity and increasing technological disruption.
He says lessons can be learned from manufacturing about how these can be addressed.
First, there is a need to move away from bespoke production toward processes which are repeatable and to adopt a mode of operation whereby practices can be replicated across multiple projects
This does not mean that flexibility need be restricted. Indeed, Phillpot says, manufacturing consumers have greater choice today compared with the past.
As well, the industry needs to adopt further integration in supply chains.
On this score, Phillpot points to the just-in-time philosophy pursued by Japanese car makers in the 1970s. This saw manufacturers work with suppliers to ensure that materials were delivered in the right quantities to the correct specifications at the time they were needed.
As all this happened, Phillpot said companies have been able to use insights driven by data to improve performance over time.
As processes became replicable, he says data in respect of performance of these has become comparable over different time periods. This has enabled manufacturers to assess performance over days, weeks or months and determine how much improvement, if any, is taking place.
In construction, Phillpot says increasing complexity means the days when project managers can operate based on their gut feeling about how projects are tracking are gone.
Moreover, he says the building sector can improve productivity by adopting an industrialised approach with processes which are familiar and repeatable.
That in turn will facilitate greater use of data to analyse performance over time and enable managers to make better decisions about what is and is not working well.
That data, Phillpot said, will generate even more value as technologies such as machine learning and artificial intelligence gather pace.
When this happens, predictions can be made about the future and processes tweaked accordingly to deliver better outcomes.
Partly because of this, Phillpot says significant investment is going into technology as vendors gear up to provide solutions.
In Oracle’s own case, the company over the past three years has purchased construction management platform Aconex for $US1.2 billion, construction contracts and payment management cloud services provider Textura for $US663 million and customer engagement and energy efficiency cloud provider Opower for $US532 million.
Other vendors are also acting.
The past year has seen software provider Trimble gobble up both construction management software provider e-Builder for $US500 million and construction accounting and project management software provider Viewpoint for $US1.2 billion.
As well, 3D design and engineering software provider Autodesk acquired construction productivity software provider PlanGrid for $US875 million and Building Connected for $USS275 million.
Beyond this, construction management platform Procore and offsite construction outfit Katerra have both been involved in large capital raisings.
Speaking about his own company, Phillpot says Oracle is looking to provide a stable and secure platform upon which a suite of solutions can be developed.
These solutions, he said, may come not only from in-house but also from customers themselves or other industry vendors.
He says conditions are favourable for disruption as there is an increasing number of opportunities for efficiency in complex projects, a recognised need for change within the industry and growing interest among investors.
“People are interested in change,” he said.
“There is a groundswell of people who want to improve and get better. The investment community are seeing the signs of opportunity.
Written by Andrew Heaton