The billion-dollar construction industry is one of the industries bearing the dire consequences of coronavirus crisis. Yet, it won’t be right to blame the virus and global lockdown for the industry’s low profitability and acute downfall.
The construction industry is the 21st out of the 22 industries to adopt digitization. Relatively flattened curves of productivity, profitability, and gradual digitization in construction industry have stood as roadblocks for the industry’s growth for a long time. Due to these roadblocks, the effect of the crisis on the construction industry was more severe than many other industries.
Let us study some of the short-term effects of the abrupt attack of the black swan event on the fragmented construction ecosystem.
There are a large number of short-term impacts characterized by an unprecedented event that would disappear slowly as the things would start snapping back to normal. These short-term impacts would fuel long-term changes and would help organizations devise better plans for the unforeseeable future.
- Adoption of Digitization is greater than before
The construction businesses’ dependency on building information modeling (BIM), 4D, 5D modeling, and other simulation models has increased due to the abrupt demand for remote working methods. Building and construction material distribution businesses are relying on online selling while contractors are leveraging digital twin solutions for procurement, keeping tabs on employees’ well being, conceptualizing, commissioning, and maintaining cash flow.
Although the excessive dependence on the digital models is temporary, it would help amplify technology adoption.
- Disruption in the Traditional Supply Chains
The disruption in the supply chains is one of the worst effects of the crisis on the construction industry. At present, contractors are trying to seek more reliable supplier options that can be trusted during global contingencies. Contractors are also looking for ways to save crucial and long-lead construction material inventories.
As contractors are shifting towards online procurement, building and construction material distribution businesses are also devising plans to navigate towards online selling.
Digitization is a Safe Haven for the Construction Industry for Recovery and Beyond
The above-mentioned points reveal that the unforeseen event caused by the severe global spread of pandemic is harming the population and businesses. However, a silver line can be seen in the fact that the fragmented construction industry can come back stronger after the quarantine if it takes the necessary steps for recovery and digital adoption.
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