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The New Horizon of Industrialized Construction

With innovative technology and the convergence of manufacturing and construction, we are in the early phases of a new horizon of Industrialized Construction. Today, we are witnessing a long-overdue disruption of the construction industry.

 

Industrialized Construction includes the manufacturing of single-trade Mechanical, Electrical, and Plumbing (MEP) components, such as piping, electrical conduit racking, or duct systems and multi-trade modular systems that include structural and architectural systems with complete MEP services. These manufacturing methods require less labor, enable offsite construction in facilities, jobsite assembly, and help deliver higher quality work against accelerated schedules. Also, these projects have proven to reduce waste and ensure cost savings.

 

Mitigating risk and increasing productivity has been at the forefront of the construction industry for decades.  Industrialized Construction addresses these familiar issues by making better use of resources, speeding up delivery with improving quality standards, and reducing prolific amounts of waste, common with traditional stick-building projects.

 

This article highlights Industrialized Construction drivers and why MEP Contractors must adopt them to maintain competitiveness. Otherwise, there will be an increasing risk that competition will outbid them because of the strategic advantages Industrialized Construction offers these contractors.

 

1. Increasing Productivity 

Today, almost every other industry has seen a substantial increase in productivity by adopting advanced technology and automating processes. Meanwhile, McKinsey reports global construction productivity is at an anemic plateau, growing just 1 percent per year in recent decades. With population estimated to grow around 2 x and requiring thousands of new construction project deliveries, how will the industry meet demand? It won’t unless it evolves.

 

The industry’s current limitations, such as contract language that discourages collaboration, lack of building materials, and an ongoing skilled labor shortage, are major constraints to meeting society’s needs. The conventional stick build methodology cannot sustain.

 

Moving construction processes into a safe and more efficient offsite facility is an obvious solution and proven to boost productivity and mitigate the pressures of delivering projects on accelerated schedules and below budget. McKinsey Global Institute reported that moving to a manufacturing-style system could lead to a five to 10 times productivity boost in parts of the construction industry. Studies performed by MSUITE have reported the same productivity improvement.

 

The gap between demand and capacity is growing and pushing costs for new buildings higher, so MEP Contractors that use lean manufacturing principles and Industrialized Construction methods will be the winners because their bids for services can (1) substantially undercut the competition, (2) produce a better quality product, and (3) deliver installed systems ahead of schedule, to name a few advantages. Lastly, Dodge Data & Analytics released a major study adding more evidence to productivity gains through MEP contractors leveraging model-based prefabrication.

 

2. Reducing Substantial Waste 

As we all know, materials and labor typically account for most project costs. The construction industry generates approximately a third of all solid waste. With the introduction of Industrialized Construction, there is a significant boost in the efficiency of the materials used, therefore considerable waste reduction.

 

Since materials are built in a controlled and safe environment, Industrialized Construction offers enormous efficiency gains, waste reduction, and labor savings. The Waste & Resources Action Program reports that the potential savings are as high as 90% in reducing jobsite waste by increasing the use of offsite construction, specifically using volumetric modular Construction. Industrialized Construction mitigates other significant forms of waste, such as rework, site waste, defects, and labor downtime.

 

For example, on a wood-frame wall panel, you can run a 1D optimization on all of the lumber going into it, so there’s very little waste. In other words, nesting cut lengths of material on a project can virtually eliminate scrap. Another example includes precast concrete that requires cement and steel, two materials whose cumulative production accounts for more than 10 percent of the globe’s carbon footprint. Industry estimates put approximately 20 percent for concrete and roughly 30 percent for steel, not to mention around 50 percent of labor costs.

 

3. Adoption is here; MEP Firms are taking notice. 

Industrialized Construction is taking off with each project delivered and hard data validating its benefits for MEP contractors. However, obstacles remain, including stakeholder education on how best to adopt it into their operations to achieve its advantages at scale.

 

There’s also resistance to new ways of structuring contracts and sharing risk, especially on multi-trade projects. Sharing risk with new stakeholders is a new hurdle for a risk-averse industry. Therefore, a fundamental shift needs to happen in structuring contracts and insurance if the industry is serious about implementing Industrialized Construction methods. Even just bidding on jobs becomes problematic as contractors now have to adjust crew mixes, they need to frame the building or assemble piping systems.

 

Another challenge being addressed by technology is enabling the Design practice to embrace design for manufacture and assembly (DfMA). The broad adoption of Industrialized Construction is the perceived limit to customization — mass-customized building vs. mass-produced solutions and that in-between type of project. To achieve mass-customization at scale, which the automobile industry does so well, hasn’t been reached yet. Britton Langdon, MSUITE Chief Executive Officer, has said, “construction projects leveraging prefabrication are like cars. We’re all building cars, but every project is like reinventing the internal combustion engine. We have to get better at standardizing and manufacturing products or components, not one-off systems.”

 

The last challenge involves regulatory frameworks.  In the U.S., state laws vary, and federal laws have been slow to adapt to new construction technologies being introduced. There has been progress on the broad adoption of open data integration standards, but there is no industry standard.

 

4. Three Innovations Accelerating Change

The challenges mentioned above are real but surmountable, and the future will not wait. Contract structures, designing methods, and bureaucratic regulatory frameworks are evolving. The demand for new buildings’ is accelerating, and MEP contractors are expected to deliver high-quality projects – faster, more cost-effectively, and safer. There are signs of success that Industrialized Construction is making its way into the MEP Construction marketplace.

 

The three key innovations that are catalyzing adoption involve: 

— Automation

— Data standards

— Cloud-connected tools

 

Automation of Workflows

Many solutions are pushing automation for improving design and production processes, engineering, and robotics. Software tools are making it easier for all stakeholders, including MEP designers. Working with their existing workflows and augmenting them with more efficient processes, such as building out Revit models to present back into coordination meetings, MEP designers are reducing RFIs and change orders.

 

Lastly, multi-trade prefabrication is still complex and somewhat manual. New productivity tools like MSUITE’s FabPro are vital to organize and track the multiple trades and processes within the fabrication facility and field for delivery. Robotics are also used for component-based fabrication and assembly-based robotics to assemble multiple systems is a real opportunity for future cost savings.

 

Data Standards

The second innovation promises to speed the adoption and growth of Industrialized Construction by connecting disparate pieces of the design and building value-chain, such as connecting Design, Fab and Field teams on a single data and production workflow.

 

Data standards are necessary, so there is a common way to integrate data into unique platforms across different companies, constituents, and stakeholders.

 

Bringing different parts of the construction value chain together in an integrated process, BIM sets Industrialized Construction up for success now and in the future. BIM is helping teams speak the same digital language to create a Digital Twin of the physically constructed building before it’s built. For multi-trade adoption of Industrialized Construction, the multi-discipline design is necessary. The multi-discipline design needs to be thinking about downstream constructability, and that’s Design for Manufacture and Assembly (DfMA). BIM enables Design to focus on constructability, not for one component at a time, but for all stakeholders to work together. This is where Revit, a multi-discipline BIM platform, now extends design to fabrication.

 

Cloud-Based Connectivity Tools

You need accessible, cloud-connected tools and applications. Only in the last three to four years, iOS or Android has seen widespread adoption in the AEC software industry. Additionally, fabrication shops have only recently been upgrading with Wi-Fi and technology applications on the floor.

 

The game is changing with open platforms like Autodesk Forge, which is fertile ground for an explosion of Industrialized Construction enabling software applications.

 

To address the multitude of needs across this industry, you need platforms and applications to seamlessly integrate. It requires new, innovative ways of working and a shift from data silos and point solutions designed as a band aid fix to a single problem. The natural migration to a cloud-enabled environment is the today and future.

 

5. The Revolution is Now – Join or risk falling behind.

Industrialized Construction undoubtedly provides proven ways to circumvent some key challenges facing the industry and is increasing. But Industrialized Construction doesn’t benefit unless open “greenfield” conditions are available.

 

The way things are built is changing for the better, but established practices and players need to join the revolution. The disruption is enormous, but the adoption of DfMA, prefabrication, and modular Construction will accelerate faster and faster because customers demand it. Nonetheless, the path forward is clear, and technology, as a catalyst, is paving the way for Industrialized Construction to work.

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