Andy Webster, global capital projects lead with Accenture Industry X, discusses recent research showing that many engineering and construction firms are failing to realize the full value of their digitization efforts.
The engineering and construction industry is lagging many others in the adoption of digital technologies. While others have embraced digitization and realized a doubling of productivity, its numbers have been flat or even declining. When it comes to digital efforts, “it’s not a mature industry,” Webster says.
The failure to realize full return on investment isn’t for lack of intent. The industry’s interest in digitization has been significant, Webster says. But in one recent survey, only a third of executives said they were seeing positive returns from their digital investments.
Much of the problem lies in the engineering and construction industry’s failure to achieve true collaboration, both within companies and across supply chains. Even when there’s a marked investment in digitization, it’s often limited to adoption within discrete functions. And companies aren’t doing a good job of integrating their systems with those of key partners, such as logistics providers. A particular gap between effort and results can be seen in the deployment of logistics control towers, for tracking, materials management, warehousing and workforce oversight. Only about a third of companies turning to that form of digitization has been able to reduce equipment and material costs, Webster says.
Outperformers in digital initiatives show the way to success. They are typified by strong C-level sponsorship of projects, with an eye toward breaking down organizational silos. They also promote industry collaboration, whether through standards organizations or directly with supply-chain partners. Innovative commercial relationships are also key, Webster says, urging the adoption of “win-win” contracts that are incentive-oriented for all parties involved.
Timely, incisive articles delivered directly to your inbox.