Construction Industry Not Ready for Building Smart Cities

Image credit: iStockphoto/Oranat Taesuwan

Smart cities were already a talking point before the pandemic. Now, cities are racing to become digitally wired to serve their residents and citizens better.

Yet, a new survey by FINALCAD, a software leader for the construction industry, highlighted how woefully unprepared the industry players are.

The survey, titled "Finalcad 2020 Leaders Survey: Part Two: A Digital Future for Global Construction" examined the opinions of 400 construction leaders in France, Spain, Singapore, and Japan. In the study, 47% of respondents said they do not think their sector has digital capabilities to build a smart city.

The demand is there. For example, the French government emphasizes smart and sustainability for the 2024 Paris Olympic and Paralympic Games. The ongoing impact of COVID-19 is another reason why the construction sector will need to digitalize.

The survey found these factors are pushing construction industry players to rethink and recalibrate. It noted 95% of respondents saying their organizations were 'somewhat prepared' to collect big data and adopt digital technologies.

But hurdles continue to block progress. Almost two thirds (68%) cited the inability to collect real-time data as a significant challenge for smart city development. More than a quarter (28%) also said the inability to create a digital 'footprint' of a building or asset is challenging.

Overcoming these hurdles will be crucial for smart development and 'green' construction as well.

The EU Commission, for example, is introducing a new framework, Level(s), in late 2020, to adopt a new approach to developing sustainable buildings. Level(s) encourages builders, architects, and public authorities to think about a building's lifecycle, from the sourcing of materials to the eventual deconstruction and recycling of materials.

But the research highlighted that construction firms are not ready for such an approach today; many cannot record and share data around the provenance of materials (32%) or the percentage of waste material on a recycled site (42%).

"We know from our research that profit margins were already averaging just 2% before COVID-19 — while this is no doubt extremely challenging for the industry, it's also an opportunity for construction firms to embrace digitalization and arm themselves for the future," said Franck Le Tendre, chief executive officer at FINALCAD. "By prioritizing digitalization now, they will be able to tap into future trends like smart cities and green construction. This will enable construction companies to play their part in creating a more sustainable future as well as access new revenue streams that will be key to long-term recovery."

Another major hurdle is the digital skills gap. According to the survey, 96% of respondents felt the workforce lacks the skills to use digital tools and applications to some degree. It points to a dire need for construction companies to invest in intuitive solutions that emphasize user experience and ease-of-use. This can be a tall call, as many companies are still struggling with COVID-19.

"Creating a digital-first workplace will enable construction firms to build the digital foundations for future success. Moreover, a digital-first work environment is far more attractive to younger workers — given that, by 2025, 75% of professionals will be millennials, this is key. This approach will enable businesses to play a role in future trends and revenue opportunities in the post-COVID-19 era," explained Le Tendre.

Image credit: iStockphoto/Oranat Taesuwan