KDI's future view of the construction industry

What does the future of construction look like from the lens of industrialized construction?

Just over a year ago, we released a blog: the future of the construction industry. After a year of growth, we can look back and see if our vision still stands. One thing that is of note, in our blog we mention supply chains 18 times. Not once is the term "Industrialized Construction" mentioned.

That's not to say that Supply Chains aren't extremely important to what we do. They are centric to disruption in construction, a very simple formula describes the causality:

  1. Projects are growing larger, there are more of them, and they are increasingly remote places.
  2. Meanwhile, the construction labor force is aging, and supply chains are disrupted.
  3. As a result, construction companies are shifting work into their supply chains.

This means that scope is moving from the construction site to the factory. As a result, the supply chains behind construction projects is more complex than ever before. Today, there is usually a minimum of 5 contractual layers between the GC and a supplier of building components. If not more.

Factory Construction

In the last year, we've come to the realization there is a term for this: Industrialized Construction.

Why is Industrialized Construction the future?

Traditionally, construction is a change-resistant industry. Labor shortages and supply chain disruption in the construction industry are not going away anytime soon. Materials prices will continue to rise, meaning efficiency will become more important than ever.  High demand persists in the industry among the challenges.

HubSpot Video

In order to respond to supply chain issues, construction managers need to build more efficiently. Many companies are already taking steps to respond to these challenges. In the last 10 years there has been a boom in modular construction and prefabrication. Companies such as Chick Fil A are already moving work offsite due to benefits such as:

  • Shorter construction process
  • Less waste of raw materials
  • Reduced cost over the program

So what does this future look like in 10, 20, or 50 years?

From a design perspective, we think human designers will spend much more time building frameworks and AI algorithms rather than drawing lines. Automated computing and generative design will use those frameworks to create options for architects and engineers to choose from. When the results are not as intended, the focus will shift to algorithm improvements rather than correcting mistakes in a model.

You already see significant changes in the Building Information Modelling (BIM) space:

  1. Autodesk's generative design features allow a user to iterate on design options based on criteria the user feeds the system.
  2. Hypar allows users to build their own frameworks within an open platform that can connect with most of the industry-used design tools today. The result is an open forum of ideas to execute specific workflows such as generating test fits quickly on new floorplans.
  3. Bryden-Wood in a consortium with the City of London, and Cast built an application called PRiSM to create easily manufactured designs and integrate the designs into permitting and requirements planning.

Repeatable parts play a large role in construction

Industrialized construction, at its core, is about making things as easy as possible to design and build. That translates to using off-the-shelf, repeatable parts; and thinking about projects like products. The way the industry is going, the design will be much less about drawing lines and much more about optimization. There are already lots of examples of the first steps here.

Productized Kitchen

The role of the systems engineer will become more critical as the industry focuses on writing algorithms and system rules. Product-level design which must include detailed manufacturing & assembly plus lifecycle management information will be similarly prioritized. This will force suppliers to evolve how they share data.

Long lead times for complex construction materials will persist. Transparency into multiple tiers of the supply chain will be the norm. It will be standard to receive this information along with material cost and technical specifications.

What does this mean for contractors?

Companies in the construction space will adapt to a new way of designing and building. Contractors will become experts at managing supply chains. They will use demand signals and dynamic market data to prioritize management of key commodities and components. They will understand product interfaces and know how to manage and optimize complex logistical networks

Manual, complex, repetitive, or dangerous tasks will be automated for construction workers. Checking of installation, inspections, and accuracy will be monitored on the fly by drones. Materials will be delivered to the site by automated vehicles, and the inventory numbers will be automatically updated and time-stamped.

Certain packages will continue to be site executed: excavation, most concrete foundations, utilities, and landscaping are good examples. However, a vast majority of packages will have an offsite element. They may be fully volumetric modular or kits of parts ready for field-level assembly.

Will we really reach this future? 

This may seem an impossible view of an incredibly mature and change resistant industry. However, consider that not a single technology needs to be invented to make this happen. Industry dynamics, namely the mismatch between supply and demand are already forcing the industry to take steps to make construction more efficient.

Want to read more? 

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