Optimism in North American construction industry remains high

InEight Inc., a global leader in construction project management software, has launched its second annual Global Capital Projects Outlook. The Outlook draws insights from research conducted with 300 of the world’s largest capital project owners and contractor construction professionals across North America, Europe and APAC.

The research reveals that 99% of North American respondents – the highest globally – are either very or fairly optimistic about their organisation’s growth prospects for the next year, up from 97% in 2021. Digital technologies (54%) offer the top opportunity for growth, however almost all (95%) North American respondents said that their experience of change management left room for improvement, signalling a need for a more sophisticated, human-centric approach to technology implementation.

Tracking the global sentiment, North American respondents identified uneven or sporadic implementation (55%), process and data integration issues (54%) and technical and system limitations (49%) as the top frustrations caused by technology upgrades. North American respondents were also most likely to say that legacy ways of working prevent them from adopting new tools and processes in comparison to other regions (52% vs a 46% average).

Commenting on the Outlook, Jake Macholtz, CEO, InEight, says: “Encouraged by record planned infrastructure investment in North America, everyone we speak to is talking about growth opportunities for both owners and contractors. The optimism, resilience and confidence of the industry is almost tangible it’s so strong. This is especially promising given the economic backdrop that organisations are operating within, the difficulty in breaking away from the past, and the challenge of digital transformation. However, it’s also the prospect of leveraging digital technologies to build a better world that is keeping spirits high.”

Human-centric transformation

The Outlook found that respondents see digital technology as broadly helpful in their day-to-day roles, particularly, having reassurance of environment, health and safety (EHS) policy adherence (56%) and gaining detailed and holistic information on projects and events (53%).

However, highlighting the need for a human-centric approach, 92% of North American respondents said they had concerns about the future of digital transformation. Reduced in-person communication (45%), increased difficulty in understanding site/project reality (43%), and professional experience and human intuition being replaced by technology (35%) were all cited, reflecting similar concerns to their global peers.

When asked what benefits they hoped digital transformation could deliver in future, North American respondents said greater strategic insights (49%), more automation (46%), better communication (46%) and more control (44%) were all on the wish list.

“Respondents are clear on the benefits of digital technologies and eager to realise this new vision of the future but right now we are falling short when it comes to managing organisational change, making digital transformation unnecessarily arduous.” Macholtz says.

A tenuous operating environment

Against a backdrop of supply chain shortages, inflationary pressure, energy challenges, and war in Ukraine, capital project owners and contractors are unshakably positive about the direction for the industry. Notably, North American respondents reported a significant increase in construction and capital projects spending (up from 61% last year to 75% in 2022).

In a departure from last year’s Outlook, the completion of projects on time and on budget, as reported by contractors, has fallen dramatically (-23% and -26% respectively) with the region performing worse than other regions. An inability to see current project status and data at a detailed level (54% vs a 47% global average) was reported as a key influence on North American respondents’ project performance.

“Many projects become late and over budget because of poor planning, not poor execution," Macholtz says. “Many organisations lack rich, real-time data on project performance and progress, so they are repeatedly blindsided by unmanaged or unexpected risks and miss opportunities to make smarter decisions.”

Click here to access the full report.

Read the article online at: https://www.worldpipelines.com/special-reports/19072022/optimism-in-north-american-construction-industry-remains-high/