Optumplus senior manager of project delivery services Philip Thomas was the speaker at the "disrupting the AEC industry" session at Buildex Vancouver on Feb. 15.
Thomas began by saying that in order to make the architecture engineering and construction industries (AEC) relevant to the 21st century it is necessary to disrupt it.
Thomas defines disruption as a change to the traditional way an industry operates. He cited Amazon as a company that doesn't think as a retailer, more as a technology and innovation company that happens to sell things. Amazon employs the idea of innovating in the "last mile" to the customer, and by doing so it disrupted several different industries.
AirBnB is another platform which connects producers and consumers, in this case hosts and travelers, to facilitate their interactions and exchanges. Apple by contrast didn't disrupt an industry, it just refined a product into a unique user experience. Uber also did not disrupt the industry. "Did cars disappear off the streets? No," Thomas said. However, Uber may itself be disrupted by driverless cars.
Hyperloop, Elon Musk's experimental high speed tube network, may yet disrupt the cargo and transportation industries.
Technology, Thomas said, places a premium on innovation and creativity. It also introduces "digital Darwinism," the economic survival of the fittest.
"Only 71 companies from the 1955 Fortune 500 still exist," Thomas said.
Globalization also removed boundaries for goods, then converged with IT and logistics. Robotics will further upend economies as robotics allow people to offer their services remotely.
Sustainability has changed in that it has shifted from recycling to reuse. There is growing demand for materials, but a need to use them without destroying the environment. The "take, make, dispose" economy we currently employ is reaching its physical limits, Thomas said.
All of this leads to the "circle economy," a model where the economy is restorative and regenerative by design.
The challenge ahead for AEC, Homas said, is that there is an urgent need for change, particularly as the current methodologies lead to poor communication and performance problems on numerous projects.
"We are transferring risk. Cost and schedule blowouts are the norm in construction, and large projects typically take 20 per cent longer to finish than scheduled and are up to 60-80 per cent over budget," Thomas said, calling this approach a "project-shop mentality."
Thomas recommended moving away from this approach and evolving. Cities of the future are changing and becoming "smart," and this change will mean the city will understand what citizens need, Thomas said.
Circular design means any material put into a building is digitally tracked for reuse, making for cheaper and more flexible built environments where components are modularized.
Vancouver is buying into this approach, Thomas said, and is part of the Circular Cities Network, which was launched in 2016 and comprises of Austin, Boulder, Copenhagen, London, New York, Rio de Janerio and other cities.
What needs to change is removing the inflexibility inherent in the AEC industry, Thomas said. He added that if the industry remains resistant to change, someone will eventually come along who delivers the same results in a different and more efficient way.
Modular concepts also have to be adopted, Thomas said. Mining and oil and gas have been using modules for a while, and "we have to start thinking of buildings like that," he said.
Modular can be applied to not only buildings but also factories, which takes less time and drastically reduces costs.
Research and innovation is happening outside the industry in universities and research institutions, and Thomas emphasized the need for the industry to take matters into its own hands, or be replaced.
He added access to big data, which can be used to design and analyze cities, is more accessible than ever before. But it is the responsibility of the industry to learn how to harness and use that data.