Over the past two years, the construction industry has done whatever it takes to deliver projects despite huge challenges. The uncertainties faced by engineering and construction will worsen as governments begin to boost their post-COVID-19 spending on infrastructure and inflationary pressures bite deeper. We are at a turning point where organizations can choose to embrace the technology revolution that is underway in construction and, by doing so, win more projects with profitable margins, deliver them more efficiently and more safely, develop sustainable competitive advantage and survive long enough to reap the benefits.
Construction productivity has advanced at a glacial pace over the past 30 years and margins remain stubbornly low. According to the CBI’s Fine Margin report, in 2019 the UK’s 10 largest contractors by revenue made an average profit margin of -0.1% compared with an average 2.6% across the top 100 firms. That was an improvement on the previous year’s paltry -0.9% but contractors see very little financial gain, especially considering they hold most of the risk affecting project outcomes.