Cultural Change in the Construction Industry: Embracing Technology to Reduce Risk and Maximize Profits

Current Industry Situation and Barriers to Technology Adoption

The engineering construction industry has long faced fixed contract terms, complex planning processes, and fragmented supply chains, resulting in extremely thin profit margins. However, the industry has been hesitant to adopt technology solutions, with many companies still relying on multiple unintegrated reporting systems and lacking standardization. This means that project performance largely depends on the personal judgment of site management, and early warning signs of contract delivery issues are sometimes overlooked.

Real-time information could enable companies to make quick decisions, while analytics and artificial intelligence (AI) tools can predict potential outcomes of contract performance. So why has the industry not yet widely embraced technology?

Kelly Boorman, Head of Construction at consulting firm RSM UK, points out that enabling AI tools is not easy. Data must be robust enough to support decision-making, especially on large, high-risk contracts. Given the large amount of non-standardized data, fragmented systems, and over-reliance on manual input, change is imperative. Construction companies must centralize and standardize data before adopting AI, while also ensuring data security to guard against the growing risk of cyber attacks.

For companies with thin profit margins, building reliable, agile, and real-time data systems within a vast supply chain, massive data sets, and volatile market conditions requires significant investment, with benefits not immediately apparent.

Digital Strategies of Leading Enterprises

Nevertheless, savvy companies are pushing digital strategies to completely reshape their processes. Some have integrated contract valuation reporting into industry software and are using automation to process data. New AI tools are increasingly being used to analyze contract performance and predict outcomes and trends.

During the contract bidding stage, AI handles a large amount of work in the early phase to reduce manual input, but later stages still require careful human review. In addition, models have been established that can provide real-time pricing during contract execution, allowing quick identification of cost overruns.

Data analytics and AI are also playing a role in improving health and safety, reducing the risk of injuries and near-miss incidents. Wearable devices provide alerts to enhance site safety, while robotics can analyze environments to determine risk levels on the ground, at ground level, and in the air.

Cultural Change: Starting from the Grassroots

However, it should not be overlooked that new processes, AI, and advanced technologies may cause workers to fear being replaced. Embedding new digital strategies and mindsets requires careful communication with personnel responsible for contracts, bidding processes, and procurement. Site personnel must be involved in the design of new processes to fully leverage their years of industry experience and knowledge.

Boorman emphasizes that the common mistake companies make is treating new technology as a top-down or IT-driven initiative. In reality, it should focus on comprehensive cultural change, starting with early involvement of grassroots personnel who are responsible for key operations and can identify challenges.In capacity-constrained industries, AI can enable companies to redeploy employees to more strategic and human-centric activities, thereby improving efficiency. Eliminating tedious processes helps win employee support, allowing them to shift to work that creates real value. Additionally, unlike humans, technology can work around the clock.

A clear AI and digital strategy should be driven at the board level, with engagement achieved through working groups at the site and operational levels. Embedding AI is not just about introducing new software tools, but a cultural change in business models and work delivery methods. If implemented properly, it can reduce risks, promote sustainability, and improve efficiency.

Conclusion: Returning to Long-term Industry Themes

As global infrastructure investment continues to grow, the engineering and construction industry must accelerate digital transformation. Cultural change is a key prerequisite for technology adoption, and only by combining grassroots participation with strategic top-level design can the full potential of AI and data analytics be unleashed. This transformation is not just about maximizing profits, but an inevitable requirement for the industry to adapt to urbanization and industrial modernization.