UK construction at a crossroads: embracing digitalisation for future growth

The UK construction sector is undergoing a massive digital transformation upheaval – or, at the very least, that’s the plan. The reality, however, is often somewhat different.

Those are the findings from the Causeway Insights 2023 survey of construction industry professionals, conducted by construction technology provider Causeway Technologies. It reveals that digital transformation remains high on the agenda, with most of those surveyed reporting that their organisation is currently implementing initiatives to digitalise aspects of their business process.

However, while 71 per cent of C-suite executives believe their organisation to be digitally mature, feedback from those in less senior positions suggests that progress might not be as advanced as bosses think.

Causeway found manual spreadsheets are still ubiquitous: 94 per cent of organisations in the survey still use them, despite the adoption of technology designed to supersede them.

Meanwhile, 87 per cent of respondents said that inconsistent processes and technologies pose a challenge to their organisation, and a third said administrative tasks remain among their businesses’ biggest productivity challenges.

As Rob Christie, head of finance at EKFB and one of the experts who reviewed this research for Causeway, says: “The perception is that ‘it’s all digital’. But I’d argue that it’s only truly digital if all the inputs and processes behind the raw data and the collection of data are also digital.

“If your teams are manually inputting data from paper into an Excel file and uploading this file to create a power BI dashboard – in my opinion, this isn’t ‘digital’. It’s only when you understand the source of the data and its inputs that you can be confident that controls and processes are in place to allow the digital thread to flow through.”

Integration woes

Despite 95 per cent of those surveyed agreeing that integrated or automated processes and technologies are key for driving success, no respondents reported that their organisation’s software solutions were fully integrated with one another at present.

On average businesses are using seven different industry-specific solutions, the majority (57 per cent) of which are not integrated or talking to each other.

One of the most shocking figures from the research was that respondents thought employees are spending an average of 48 per cent of their time moving data between industry-specific software solutions. 

Every organisation surveyed also said that they customise these software solutions to some degree to meet their needs – and 54 per cent say the products are completely customised. This is even when customising solutions frequently leads to higher costs, compromised quality and a lack of data cohesion.

“The headlines from this research confirm that, although every business we spoke to considers itself somewhat or very digitally mature, the reality is less clear-cut, with common challenges across the sector when it comes to the consistent adoption and use of new technology,” says Rob Ramsay, Product Director at Causeway. “Industry-specific software solutions lack integration, with employees spending a shocking amount of time moving data between different systems, rather than making use of their time for more productive tasks.

“Meanwhile, the over-customisation of software and the lack of integration present big challenges to construction companies, including increased costs to maintain and update software, reduced data visibility and continuity, and security concerns.

“Customisation culture is holding us back. The UK construction industry urgently needs a more integrated, standardised approach that covers all aspects of an organisation’s processes.”

Sustainability goals

The survey also explored the relationship between digitalisation and sustainability targets.

A third of respondents reported that meeting sustainability and ESG goals are among their organisation’s greatest challenges, and the survey results suggest many are looking to digital technologies to support this.

The vast majority (94 per cent) of respondents say technical innovations are key to driving decarbonisation, and 96 per cent agree that their organisation would benefit from the use of digital tools to help drive decarbonisation and energy efficiency.

“People really struggle to calculate a return on investment for digital tools, particularly in terms of sustainability,” says David Emery, a consultant at the Supply Chain Sustainability School. “And it’s really hard to make the business case sometimes. But what we often hear from our members is that, when they do invest in digital tools, they usually exceed the return on investment because things happen that you didn’t anticipate.”

To support this move towards digitalisation in sustainability reporting, Causeway is currently working on a collaborative venture with major contractors and suppliers to develop an automated, real-time solution for Scope 3 emissions reporting.

The Causeway Insights research was conducted in April 2023 among 175 respondents, all of whom authorised or influenced the purchase of software in their organisation. Companies ranged from SMEs to Tier 1 contractors, spanning construction, housebuilding, building services, infrastructure and civil engineering.

The research data was then reviewed by three experts, including Rob Christie at EKFB, David Emery at the Supply Chain Sustainability School, and Barry Desmond, Finance Director at John Craddock Ltd.

Full findings of the research have been published in a report called Beyond the Basics – How UK Construction is Using Digital Solutions to Achieve Efficiency, Integration and Sustainability’.

The report unlocks a deeper understanding of the current state of play in terms of digitalisation in the construction industry. It features data and analysis, with feedback and commentary from industry experts, and looks at how principal contractors and large subcontractor companies are approaching the common challenges that come with digital transformation.

Click here to view and download the report today.

Rob Ramsay, Product Director, Causeway Technologies