MANUFACTURE THE CONSTRUCTION?

We all know construction industry is one of the oldest industries in the world. We have seen some of the great architectural and construction marvels like Great Wall of China, Taj Mahal, the Colossus and many other engineering marvels of the ancient times. But as the technology advancements are taking place in the world construction industry is not left out.

Having said that, construction industry is conservative by nature. And also due its fragmented nature, this industry is more of an informal one. Eg- Only in USA alone there are more than 600k construction companies and more than 80% of these companies have less than 20 workers. Now you can understand the extent of fragmentation and the informal nature of this industry. One of the major reasons for this nature is because this is probably the only industry existing which emphasis less on the R&D, digitalization and tend to continue with all the old and conservative techniques of construction. The reason is because of the size of the project, which is huge, along with the cost and the stakeholders, which are also in huge numbers. The industry has gained only 1% of productivity in the last two decades, which is significantly low when compared to the other industries. In order to minimize the cost due to error, most of the companies out there take less chances and continue with all the old techniques and technologies.

But at the same time, we cannot deny the fact that the things are changing slowly and gradually and new techniques are considered and forced into play/action. The R&D wing of the industry is slowly gaining grounds and in order to reduce the cost of the project and delivering the project on time, which is a great deal in this type of industry where majority of the projects are never delivered on time and due to this the cost increases eventually. According to a survey, 70% of the companies in this domain believe that if they will not adopt the new techniques, technologies and various other digital tools, they would go out of business.

As the margin of profit is less than 5% in this industry unlike the software industry having profitability margins of upto 40%, projects with new techniques along with the latest technology are being used now which will help to increase the margins and improve the profitability.

PREFABRICATION

Prefabrication is going to be the new normal for the construction industry. Reasons –

1. Cost effective. 2. Less time consuming

Prefabrication techniques are slowly and gradually picking up the pace. Recently there was a news all over the media that China have constructed a temporary hospital of around 1k beds for the Covid 19 patients within 10 days. This news has been highlighted many times but this is not the first time that such a thing has happened. Now there are many companies in the world which have started to the manufacture the construction parts in the factories and the only work left is to transport and assemble the various components at the construction site which is just the opposite of the traditional technique in which the whole construction of the project/ building is done on-site. One more example is that of Tesla’s gigafactories. Tesla’s GIGA shanghai factory was built will this technique. The results were UNBELIEVABLE. It took only 365 days to construct this Gigafactory. On the same grounds, Giga Berlin is also being built with the same technique. Now, after seeing the potential of this new technique of prefabrication, things are going to change in future for the construction industry for sure.

Though this new trend has not been seen in India as of now, but in order to grow, these new techniques are inevitable and certainly the new technologies will revolutionize this industry.

So, in a way we can say that we have started to manufacture the construction.