Despite a reputation for lacking innovation, the construction industry has embraced a remarkable amount of technology that has improved the way we build. Perhaps no single piece of technology has irrevocably changed the nature of our industry more so than Computer Aided Design (CAD). The introduction of CAD software to construction has greatly improved the productivity and quality of project design, forever changing the role of architects in the process. By representing two-dimensional plans in software, we’re now able to detect design clashes before construction begins and quickly iterate on new drawings. What was once a problem that bedeviled architects and builders, has become easy to analyze and correct during normal project planning.
McKinsey estimates that 98% of projects over one billion
dollars in size are on average, 80% over budget and 20 months behind schedule.
But once a design is completed, what’s the best way to turn those specifications into an actual building? Figuring out who is going to do what, when and where to go out and build a project on time and on budget is the essence of construction. And unlike in design, we are still unable to leverage advances in technology and computing power to help us perform this critical job better. The results speak for themselves — McKinsey estimates that 98% of projects over one billon dollars in size are on average, 80% over budget and 20 months behind schedule.
Today’s planning and scheduling functions are detailed and complex, which makes them ripe for improvement due to their manual nature and probability of human error. Assembling a construction schedule is a manual, time-intensive and error-prone process that relies too heavily on the gut-sense of an experienced builder. It often takes weeks with constant back and forth between a general contractor, the architect and owner, to account for changes on a single schedule. Human intuition can never be replaced, but when hundreds of millions of dollars are at stake more precision is needed. General contractors lack the ability to use computers to simulate a construction process. There is no CAD for construction. Without the ability to explore multiple building scenarios, it is impossible to stress-test a construction schedule to spot errors and understand risks prior to breaking ground. Unfortunately, this means that the only time flaws in project planning are exposed is during actual construction, where the cost of mistakes is at its highest.
General contractors lack the ability to use computers to simulate a construction process. There is no CAD for construction.
A general contractor surviving on operating margins of 3% — 5% cannot afford to take the business risk associated with poor project planning. This is even more pronounced in the face of the labor shortages, rising input costs and increasingly demanding owners that characterize today’s competitive construction environment. Without a way to dynamically explore a building plan, GCs are limited in their ability to value-engineer a project and become high-level strategic partners to their clients. What is needed is an integrated platform that can model the flow of resources through a project in real time, allowing them to explore multiple construction schedules with low latency and make smarter building decisions.
Stay tuned for ALICE’s next blog series on how ALICE addresses the challenges facing the industry with the world’s first construction simulation platform.