The Civil Engineering Contractor May 2019 | Page 40

BUSINESS INTEL
Each of the panel members gave their views on the future of the construction sector in
the new digital age.
intelligence (AI) is dangerous, but
nonetheless we have top IT talent in our
company and are every year developing
new tools to make construction more
efficient,” says Wylie.
He noted that because each day
and each project is different, software
has to be proprietary to a company,
“Because nobody else does what we
do the way we do it.”
Kent noted that his international
company has developed a considerable
amount of AI software (primarily
in Canada), and admitted that the
challenge was to find customers
willing to be at the forefront of
accepting it. “We are at the forefront,
and it would be a quantum leap to get
our customers to adopt it, because
any digitisation that reduces the need
for labour is going to be difficult
in the South African context.” The
cost drivers around automation are
greater in developed countries where
labour is more expensive than locally.
Yende pointed to the skills gap
developing with new technologies:
“If you look at the efficiencies we
have to drive with machinery, the
more you invent and the more you
optimise your machines and its
efficiency, there’s a gap that you’re
creating in terms of people. How do
you innovate the skills that you have?
We are approached by a lot of young
people with innovations, and we’re
currently onboarding them from an
enterprise development perspective
to see what we can integrate with
38 | CEC May 2019
what they have to offer, into our
machine and into our future.”
Strydom highlighted another
challenge with AI in a southern Africa
context: that of poor distribution
of Internet connectivity, allied with
the reality that many infrastructure
construction sites are located off
the beaten track. “Even at our head
office in Swaziland we struggle with
connectivity. It is insufficient with
which to run this digital revolution,
never mind the north of Mozambique
or western part of Zambia. We need
to go in this direction but cannot
create the connectivity ourselves.
“In addition, the construction
industry at the moment is in a struggle
for survival. If companies are in a
struggle to make payments at the end
of each month, it becomes difficult for
them to make additional expenditure
on technology. Governments are not
rolling out the work — especially for
our sized company — aggravated by
late payment, so as much as we realise
we have to adopt new technology, it is
difficult to do so,” said Strydom.
Raghubir noted that construction
firms seemed to be of the belief
that automation could not be
achieved in construction, but gave
the example that it had already been
done by a Silicon Valley firm, Katerra
Construction. Founded in 2015 by a
group of real estate and electronics
chiefs, Katerra aims to disrupt the
construction industry by integrating
design, component manufacturing,
and site assembly together under its
digital platform. “We need to study
how that model can be applied in the
South African environment,” he said.
SAFCEC’s
Mfebe
added:
“Automation in the form of the
adoption of new technological
applications and process innovation
in the construction industry will
be driven by client demands for
effective, efficient solutions that will
save them time and money, while at
the same time being technologically
sound. At the same time, it will be
driven by the competitive advantages
that accrue to those construction
companies that apply them.
“The writing is on the wall for
construction companies to either
‘innovate or evaporate’. It is sad to
note that the construction industry
— not just locally but globally — has
failed to embrace digital technology.
The industry spends less than 1%
of revenues on R&D, compared to
the auto and aerospace sectors that
spend 3.5% to 4.5% of revenue.
McKinsey in a report anticipates the
world must spend USD57-trillion on
infrastructure — so here is a reason to
find technological solutions to improve
productivity and project delivery.”
However, it was subsequently
pointed out that in the current
environment, the engineering and
construction industry was working
on margins close to 1%.
Mfebe highlighted the contradiction
faced by South African construction
firms like WBHO, which operate in
regions like Europe where automation
is more commonplace in order to be
competitive, whereas back in South
Africa, the impetus via policymakers
is on job creation through labour-
intensive methodologies by, for
instance, increasing the incentive
for youth employment in the latest
national budget. He emphasised
that South African companies would
ultimately start using technology to
gain a competitive edge, and this
would shake up the industry.
The International Standards
Organisation (ISO) conducted
research which showed that BIM
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