The global construction industry is expected to grow to $9.4 trillion in 2015. Construction firms spend an estimated 1.1% to 1.6% of annual revenue on information technology (IT), which is lower than the investment levels of other industries.
If the rate of IT spending remained static, the total available market for construction IT would range from $103.4 billion to $150.4 billion in 2015.
Those are very big numbers. If only 5% of the construction IT spend went toward project collaboration solutions, the potential market would reach $5 billion to $7.5 billion in 2015. Even with generous annual revenue estimates for all vendors in this space, it would be reasonable to say that the market is vastly under served. Look for a rolling wave of adoption beginning in 2014, supported by overall growth of IT spending in construction.
Industry-Specific, Turn-Key Solutions
The role of project collaboration solutions will continue to expand across all segments of the industry as the workforce evolves to become more data-driven and projects of all sizes become more complex. As adoption increases, the competitive landscape will shift toward those that do versus those that don’t – and ultimately those that deliver higher-quality projects with lower risk, on time and within budget.
In parallel with that shift, industry-specific, turn-key solutions will take precedence over enterprise software, requiring intensive IT customization. Generic file sharing and document management are fine for certain internal collaboration projects. But when independent companies are iterating terabytes of data through interdependent workflows where every hour and every dollar count, construction collaboration solutions are the only viable option.
Technology Trends to Watch
Increasing pressure on productivity and profitability will be eased by the practical application of key technology trends. These trends – including Software as a Service (SaaS), mobility, Building Information Modeling (BIM), and big data – will converge on secure, neutral platforms that enable diverse project teams to collaborate seamlessly toward successful project delivery. The use of these technologies will also reshape the competitive landscape.
Within that context, here are five predictions for 2014:
1) SaaS will continue to gain market share over on-premise hardware and software, due to advantages of cost, flexibility and accessibility. Multi-company projects can’t be managed effectively – if at all – from behind corporate firewalls. Nor are corporate firewalls required to meet the highest standards of security. SaaS solutions outsource IT investments, deploy quickly and are a natural for collaboration.
2) Mobility – anywhere/anytime access to project information from smartphones and tablets – will become a necessity rather than a luxury, due to its impact on the speed and accuracy of project execution. Construction happens in the field. Construction and engineering professionals use mobile devices in their personal lives and also bring them to work. Collaboration solutions without robust mobile apps across platforms will be left behind.
3) BIM collaboration will extend from design teams developing models in their native authoring software to construction teams consuming this information and contributing to the models via browsers and mobile devices. BIM will focus on the objects and spaces within the models and all of the project documentation associated with them. The result will be complete, accurate and auditable project data ready for handover to the owner at practical completion.
4) Big data will become a big influence on construction projects, as data volumes continue to expand with project scope and complexity. The use of mobile devices for anywhere/anytime project collaboration and management will also contribute to this trend. Large construction firms will begin to integrate data from both internal and external sources and employ analytics to benchmark their performance from one project to the next.
5) The collaboration solutions driving adoption will address all phases of the construction project lifecycle – feasibility, design, building, and operation. The integration of process functions such as document control, correspondence, workflow management, building information modeling (BIM), field inspections, and asset information handover will spare buyers the interoperability issues of multiple point solutions.
Construction technology isn’t new, but it’s rapidly approaching an inflection point. Project collaboration solutions are at the tip of that point – still relatively early in their adoption curve, yet poised to accelerate in 2014 and build momentum through the next decade. Buyers will favor industry-specific services that are comprehensive, easily deployed, ready to use, and scalable to manage unlimited amounts of data for unlimited numbers of users.
Much of the momentum will come from users on project teams who move on in their careers to become decision makers or recommenders on other projects. Some will learn valuable lessons in risk management from a bad experience with a project that gets out of control. Others will learn equally valuable lessons from a good experience and be determined to emulate it. Ultimately, technology adoption is about comfort, familiarity and confidence, as project success builds on itself.
 Global Construction 2025, Global Construction Perspectives and Oxford Economics, July 2013
 “Construction Industry Dead Last in IT Spend”, Engineering News-Record, November 28, 2012