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The engineering and construction (E&C) industry is on the cusp of new a golden age. Driven by evidence-based decision-making, enabled by data science, and further accelerated by developments in artificial intelligence (AI), this emergent era will be characterized by machine-augmented analysis, increased efficiency, and higher productivity. The convergence of new technologies with existing best practice processes will give rise to a new discipline — total cost management analytics.
As increasing resource shortages place pressure on the industry, change will become a necessity. However, change will not arrive without significant challenges for industry incumbents. As many routine tasks are automated over the next 5 to 10 years, E&C companies and their project delivery teams will face a period of unprecedented digital disruption. To keep pace and profit from new, yet-to-be-imagined efficiencies, they must immediately develop strategies for bridging the skills gap and strengthening the data literacy and digital fluency of their workforces.
E&C is, without question, critical to the world’s well-being. As a sustainable flow of electrons becomes as important to our cities as the flow of clean water, our ability to develop infrastructure that remains resilient in the face of emerging cyber and environmental risks will influence how we live, work, and play for decades to come.
E&C is also big business. The construction industry is worth 13 percent of global GDP or $10 trillion per year. The increasing urbanization rate, estimated at 200,000 people per day, coupled with the need to maintain existing assets, is expected to generate infrastructure projects worth $57 trillion by 2030.
Hidden within these numbers is a serious problem: there are insufficient resources to satisfy the world’s development needs. We will likely soon face a $15 to 20 trillion funding shortfall.2 To bridge the gap, we must analyze and overhaul traditional construction processes, finding ways to do more with less. At the same time we must take steps to ensure that tomorrow’s workforce is adequately prepared to apply a new arsenal of more efficient methods and tools.
Digital transformation is increasingly touted as a panacea, but it will only succeed if we can look beyond the hype to pragmatically determine where the greatest potential benefits lie.
Many of today’s companies seem to believe that actively embracing a digital-first business posture is as simple as digitizing their conventional processes. While that’s a logical place to start, companies can achieve far more disruptive change and competitive advantage by experimenting with data science and AI.
Within E&C, advancing technologies such as drones, LiDAR, and the Internet of Things (IoT) have the potential to produce rich, unconventional data streams that, examined through a data science lens, will allow teams to uncover revolutionary new efficiencies. Within a decade, AI may advance to a point where it can provide prescriptive guidance, supporting planners with the development of more realistic targets or accurate performance predictions. Project delivery teams will be able to augment their experience and strategic know-how with deep tactical insight provided by state-of-art machines. Once applied to best practice project delivery processes like total cost management, such technology could give rise to a new discipline — total cost management analytics or TCMA. We’ll further explore the concept of TCMA and its ramifications for project stakeholders in future blogs.
As data science and AI continue to advance, all sectors and industries will feel their increasingly disruptive effects. E&C is no exception. To profit from that disruption, E&C companies must equip themselves and their workforces to embrace these technologies before it’s too late.
With more than a decade’s experience delivering the systems, processes, and expertise that underpins this digital renaissance, Booz Allen is well-placed to serve as your strategic partner, bridging the skills gap and providing the vital training that your program and project delivery teams need.
 LiDAR is a surveying method that measures distance to a target by illuminating the target with pulsed laser light and measuring the reflected pulses with a sensor.