Seizing opportunity in today’s construction technology ecosystem

By Jose Luis Blanco, Andrew Mullin, Kaustubh Pandya, Matthew Parsons, and Maria Joao Ribeirinho

A new analysis of the construction technology ecosystem finds emerging trends, constellations of solutions, and an ever-increasing universe of technology use cases that are disrupting the way we plan, design, and execute projects.

After decades of under-digitization, the engineering and construction (E&C) sector is making bold moves in a new era. Last year, we mapped the industry’s technology ecosystem with a focus on the solutions that are proliferating in the construction phase of the project life cycle. The research shed light on the emergence of technology clusters, industry-wide technology investment of more than $10 billion in less than a decade, and the lack of integrated solutions that span three identified use case clusters: on-site execution (“field”), digital collaboration (“team”), and back-office and adjacencies (“office”).

This year, we expanded the study to include the entire asset life cycle—concept and feasibility, design and engineering, preconstruction, construction, and operations and maintenance—across more than 2,400 technology solutions companies, creating the most comprehensive database of the construction ecosystem worldwide. In this article, we explore three key topics based on our latest research:

1. What are the emerging trends from this year’s research? We explore how the landscape has changed over the past year in terms of constellations of technology, accelerated investment, and an expansion in the number of use cases.
2. How will the market evolve in the coming years? We discuss the changes we expect over the next few years, including continued fragmentation of the industry, which will lead to consolidation, as well as an intensifying fight for talent.
3. How can the industry accelerate its transition to a digital future? We outline recommendations for AEC firms, technology providers, and owners to accelerate the impact of technology.

1. What are the emerging trends from this year’s research?

Three key trends are shaping the industry: emerging constellations of solutions around established use cases, accelerating technology investment, and an expanding set of promising use cases.

‘Constellations’ of solutions emerging around established use cases

In our continuous mapping of the construction technology landscape, we see the concept of different “constellations” of connected solutions emerging around established use cases, which serve as indicators of what technologies are gaining the most traction and where their impact can be expected to rapidly increase in the near future. Today, the most prominent constellations include 3-D printing, modularization, and robotics; digital twin technology; artificial intelligence (AI) and analytics; and supply chain optimization and marketplaces (Exhibit 1).

Exhibit 1

Within each constellation are three or more use cases that span the three use case clusters we identified last year: on-site execution (“field”), digital collaboration (“team”), and back-office and adjacencies (“office”). For example, the digital twin technology constellation includes drone-enabled yard inspection, which is an on-site execution use case, as well as several digital collaboration use cases: laser scanning, virtual learning, and design simulation. In Exhibit 1, the thickness of the lines connecting various use cases indicates use cases that are often addressed together; in the digital twin technologies constellation, design simulation and virtual learning are strongly linked given the increasing amount of solutions offering these two uses cases in combination.

In particular, three of the constellations—3-D printing, modularization, and robotics; twin models; and artificial intelligence and analytics—are poised to be transformational for the industry. A fourth constellation, supply chain optimization and marketplaces, is notable due to its quick rise as dozens of smaller players have entered into this market over the past year.

Read more on the original McKinsey’s paper.