Construction is lagging behind.

This is not our opinion, but that of renowned research and consultancy organisation, McKinsey & Co. The industry’s productivity rate is lower than most other sectors almost universally around the world. With a few notable exceptions, such as China and India, productivity is poor and growth is slow. For an summary, check out McKinsey’s report Reinventing Construction.

Why is this?

There appear to be a number of reasons – not least our specialist subject, construction disputes. But the challenges posed by the construction dispute are compounded by poor management, poor organisation of data and limited collaboration and communication. Disputes need not occur and if they do, they need be as costly as they are.

We’ve mentioned before, in our 10 Top Tips blog, ARCADIS’ report which highlights the huge cost of disputes. The McKinsey report also notes that large projects are typically 20% over time and 80% over budget. In the US, disputes cost over $12bn each year. In the United Arab Emirates, where construction disputes are notoriously costly, a similar figure would equate to $248,400,000 or more than AED 9M lost each year to dispute resolution.

What Can We Do?

Adoption of technology and improvements in innovation and communication would be a positive first step. It may surprise some readers to find that at Hewitt Decipher Partnership, we don’t want to spend excessive amounts of time resolving disputes. It isn’t productive and doesn’t make for happy clients. If you do find yourself in a dispute, it is far better to be in a good position to resolve that dispute and minimise the cost, than to have to spend more than is necessary.

Technology

There are a number of systems available, but hitherto, a lot have been focussed on one aspect of construction or geared towards solving one problem. For example, Oracle’s primavera provides a great project planning tool with potential for planning in resources and cost, but rarely is it used collaboratively or pro-actively during the project.

There are tools for managing documentation and site records. Software is available for design and safety management. Rarely though, do all the stakeholders come together and invest in a coordinated fashion in the right software for the job.

Investing in technology is important. Records, plans and schedules, design documents and anything that might affect progress should all be coordinated. Whilst this article does not seek to recommend a particular software over another, there is useful research material out there. For example, this article from venture capital investors, Talis, looks at products which have the potential to create change in our sector. There are events, such as ‘project controls expo’, ’futurebuild’ and ‘glimpse of the future’. Each seeks to showcase innovators and technology providers in construction technology, “ConTech”.

Other Innovations

There are a host of other innovations we have seen in recent years. The use of virtual reality to re-create construction projects, the use of 4D modelling to identify where and how site instructions and variations led to a change in programming and cost, drones for surveying – to name just a few. As time progresses and technology is adopted, it is likely that the cost of dispute resolution will reduce. Our aim at Hewitt Decipher Partnership is to harness that technology and minimise costs to our clients.

If you have already sought to harness technology organise data before you need us, our job is likely to be easier and less time consuming. The result will be a less costly and more efficiently resolved dispute. We urge clients to seek out technologies to better manage records, improve communication between stakeholders and reduce the potential cost of construction disputes.

Hewitt Decipher Partnership’s expert consultants have been supporting clients though dispute proceedings for many years. We know how to comply with good practice to minimise dispute and if they do occur, ensure that they are resolved in a timely and cost-effective manner. Can we help you? To find out how, get in touch.