AI Likely to Advance Construction Productivity In Design, Bidding, Performance, Management
By PHILLIP ROSS, CPA, CGMA, PARTNER
Artificial Intelligence (AI) in construction has the potential to enable the industry to overcome some of the unprecedented obstacles we have faced in recent years. COVID-related issues as well as the unpredictable macro-environment have all contributed to some of the toughest times the construction industry has ever faced. Today, however, the use of AI and other innovations in construction have the potential to enable the industry to leap ahead and overcome challenges by allowing contractors and others to move through various stages of the construction process efficiently.
This includes the initial design, bidding for projects, coming up with better financing terms, as well as actual construction and asset management throughout a project’s timetable. For example, imagine AI models that can track and evaluate progress so that schedule risks are identified early on and factored into the budgeting while being proactively addressed ahead of time before a problem occurs.
The size of AI in construction reached $22 billion in 2022 and is expected to grow at 20% of the compounded annual growth rate through 2023 based on improved efficiency and productivity through optimization of project scheduling, resource allocation, and task management, leading to shorter timelines and reduced costs.
AI is essentially training a machine to mimic human thinking. Unlike humans, AI can process large amounts of data, with the end goal of recognizing patterns and ultimately making smarter decisions that a human could not do alone by manual processes. Machine learning, a subset of AI, becomes better at understanding and providing insights as it is exposed to more and more data. Over time, AI can enhance various critical stages of a construction project so that new efficiencies will be discovered to overcome challenges and delays of the past when the construction industry relied on human input alone.
Design Process — AI will improve better design of buildings and their construction all along the way. Building information modeling (BIM) involves creating and managing information throughout all phases of a construction project. By layering more information, design models can be trained so that AI will provide increasingly insightful and extraordinary insights into the entire life cycle of the project. As a result, initial cost estimates, project time completions, and various teams will be more accurately informed. “Generative” AI design also has great potential to generate design options, analyze site conditions and optimize the building layout.
Pre-Construction Estimates and Take-Off — By using AI, estimates will be more accurate and timelier in the beginning phases of the construction process. During the pre-construction phase, AI has the potential to estimate square footage so that contractors can make accurate estimates at a faster rate, rather than taking weeks at a time. When applied to the takeoff phase, AI has the potential to expedite the general contractor’s ability to come up with price estimates on materials. Better and more accurate estimates in the “take-off” from a list of materials are crucial to keeping the project within budget.
Bidding and Permits — AI can simultaneously analyze historical data, current trends, and project requirements—in this way, subcontractor proposals and cost estimates can be optimized. AI tools analyze building codes, zoning regulation and environmental requirements to eliminate obstacles.
Construction — AI can track and identify scheduling and project risks early on. By layering more information, models become trained so that AI will eventually provide increasingly insightful and extraordinary insights into the construction process so that cost estimates, project time completions, and other operations will be more accurately informed.
Labor — A 2017 McKinsey report says that construction firms could boost productivity by as much as 50% through real-time analysis of data. Today, AI can facilitate a contractor’s ability to better plan for the distribution of labor across jobs.
Safety — AI solutions can be used to identify, monitor, and prioritize safety and risks on the job site. Construction sites can be hazardous, and by using AI, risk can be identified early on to prepare safety briefings ahead of time when elevated threats are proactively detected for those on the construction site.
Artificial intelligence is invaluable in providing insights and a point of view that otherwise may not be seen with the human element alone. Today, as new technologies for AI in construction are coming rapidly into the marketplace, we now have the potential to move our industry forward with giant leaps. Overall, AI has the potential to revolutionize the construction industry by making it more efficient, more innovative, and more cost-effective.
About the author: Phillip Ross, CPA, CGMA is an Accounting and Audit Partner and Chair of the Construction Industry Group at Anchin, Block & Anchin, LLP. For more construction industry thought leadership and content, log on to www.anchin.com.