7 Reasons the global construction industry needs to innovate


The construction sector plays an imperative role in the evolution of businesses and society as a whole, and while there is continued interest in determining how to enhance innovation in this industry, little moves forward in the right direction. Despite its high contribution to the evolution of prosperous societies around the world, construction is much too often considered to lag behind other sectors in terms of its inherent abilities to innovate or adopt innovations from other areas.

Let’s shed a much clearer light on this statement: According to the Diffusion of Innovation Theory, proposed by Everett Rogers in 1995, the construction industry fits in the fifth category of “Laggards” by ways of comparing with other sectors and needs to move upwards in the category of “Late majority”.

The construction industry has little internal dynamism of innovation and change, and this view of the sector as less than proactive is reaffirmed by its characterization as low tech, and as demonstrating low levels of innovation.

Now, for those of you who need empirical evidence of why there is such an urgent need to innovate in the construction industry, here’s your reason, actually there are 7 of them:

1. R&D Is on the rocks – The Japanese example?

Investing in R&D is perceived as a daunting task and many practitioners think that research is too distant from the everyday to yield any business profits.

The construction industry is comprised of large supply networks and the development efforts of one company/country cannot stand alone, thus the repudiation of the value of shared resources and ideas definitely impedes progress and innovation.

So why take the Japanese example? Often Japanese enterprises are used as examples of the ideal construction firm, with a long term strategy to focus on R&D (i.e., robotics and “intelligent buildings”, laboratories for advanced materials), whereas in Northern America and Europe enterprises compete over price, rather than technology.

2. Shortage of skilled labor

Quiz time! What could a lack of traditional craft skills bring about in the construction industry, as in any other industry? Don’t go looking for answers! We have them for you!
The decision to adopt new technologies has been linked to the unavailability of skilled labour and the case of UK portrays a very good example: in the late 1950s, labour shortages in carpentry and bricklaying were partly responsible for the introduction of system building technologies.

This shortage is also caused by the black market that is undoubtedly ruining the construction industry.
If there’s a Curious George among you, we invite you to get an insight into another one of our topics and discover 6 Tactics For Solving Your Skilled Worker Shortage.

3. Quality is troublesome!

The quality of the products and services have suffered in quality, mainly because in the majority of countries, enterprises compete with a price differentiation strategy. The quality can be affected by many factors including: long timelines of construction projects, wrong allocation of financial and human resources, illegal certificates.

4. The scream from nature

No innovation – no meeting the global demand. Global climate change occurs at an alarming pace, so if the construction industry wants to keep up with them and adapt according to the volatile environment, it needs to start innovating.

Vast quantities of carbon emissions are generated by the construction production process, by the materials used, transportation and so on.

5. Technology, technology everywhere!

There’s a high risk that technological advances can easily pass you by and the construction industry is no exception. You have smart materials (the “self-healing concrete”), energy technologies, BIM, new advanced apps, robotics and many more, but unfortunately employees in this sector are not skilled enough to accommodate these transformative changes.

Digitalization is the new black and it positively influences quality, economy, time.

6. Timeframes are too labor dependent

The construction sector is very labor intensive; long projects usually equal decrease in productivity and motivation. Overtime for this type of projects is no joke, we’re talking years! It can yield in no further allocation of public funds, quality decrease and again lack of productivity.

Innovation can be the gateway to faster, more efficient and ingenious solutions, that should be embraced at the global level.

7. Mind the gap: lack of communication

There is a general lack of communication, both locally and globally and many practitioners believe individualism is the way to strive in constructions or make the industry flourish.

Idea: intra-organizational management as a way to catch up with all the others innovative sectors, by complementary goals, shared resources, knowledge, technical capacity and competencies.

Nothing much has changed radically for few decades now and incremental innovation tends to go unnoticed in such a large industry even though change is significant if it is positive, regardless of its magnitude. Innovation is undoubtedly a strategic mainstay for competitiveness worldwide and the construction industry needs to adopt it straightaway.

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