Time to embrace digitalisation

Due to the Covid-19 pandemic, construction companies have endured more than a year of lost growth.

Pic courtesy Getty Images

As of July 2021, production in Europe had only recovered to 98.6% of its pre-pandemic level. And, while working to get their businesses back on track, leaders must maintain the high levels of site safety needed to avoid the risk of spreading the virus among their workforces.

The continuing impact of the pandemic means social distancing is still a fixture. So is the potential need for reduced numbers of people on-site at any given time or the increased disruption of staggered shift patterns.

Companies are also faced with the need to make sure as many people as possible can work remotely (or from home).

Because of this, businesses have already explored and adopted digital solutions that enable them to maintain productive operations while protecting the safety of their workforces. But they must now accelerate their plans to embrace wider digitalisation if they’re to drive future growth.

Organisations need to harness the potential of digital transformation. And, as Shell’s latest research report ‘Under Pressure: Leading in Paradox Industries’ shows, addressing the digital skills gap in construction will be critical in achieving this.

How the pandemic has accelerated digitalisation

Even in the face of tight restrictions across different countries, companies found a way to re-establish and continue their operations. And, as highlighted by our survey of 300 global industrial decision makers, the challenges they’ve dealt with to achieve this have driven change at a breath-taking pace.

Three-quarters of leaders say they’ve seen up to five years’ worth of change related to digital transformation take place during the pandemic. From remote working tools to machine control technologies like laser-guidance systems, businesses have found it easier to make the case for digital solutions that make their operations safer and more productive.

This has also impacted on leadership perceptions of the challenges companies face and the urgency needed to overcome them. Two-thirds of construction leaders now view digital transformation as an urgent priority and say they already have plans in place to address it.

However, they still face many barriers to progress – not least a digital skills gap that threatens to prevent the digital progress businesses need to make.

Overcoming the digital skills gap in construction

The growing need for new digital skills among construction workforces only adds to the challenge of a serious ongoing global labour shortage. Leaders realise that a shift needs to take place – with 85% saying that most of their workforce will need some sort of retraining to adapt to digital transformation.

Meanwhile, three-quarters say a lack of expertise and training is a barrier to their ability to transform digitally as a business.

In practical terms, this will see businesses struggle to maximise their investments in digitalisation. For example, companies investing in cutting-edge solutions like digital twins will be hampered not only by legacy systems but also by workers with the lack of skills (or access to training) to use them effectively.

It’s no surprise then that six out of ten leaders believe that helping employees to develop new skills and ways of working will be one of the top three drivers of opportunity for their company.

Driving digital transformation across Europe

Also of interest is the disparity in how industrial organisations across Europe are set to approach future digitalisation. For example, half of UK companies plan to increase investment in skills and retraining, compared to 36% in France.

Not that investment is a solution by itself, but it would seem contradictory for leaders not to back up their stated understanding of the challenge with the investment to overcome it effectively. In this way, it makes sense that 52% of German leaders plan to increase their post-pandemic training budgets given the construction sector is suffering an acute skills shortage in the country.

This suggests that we could also see a growing disparity in digital maturity across the continent – and differing levels of productivity as a result.

Keeping construction’s foot on the gas to drive future success

Ultimately, our report shows that construction companies have stepped on the gas to drive rapid transformation during the pandemic, but they can’t afford to ease off now.

Still recovering from the initial fallout of the pandemic, the construction sector needs to make the most of digital transformation to help them increase productivity, improve employee safety and drive long-term growth.

And, while it’s easier said than done, this means addressing the digital skills gap. Without the workforce expertise in place to enable new systems and processes, the construction industry will struggle to act on the potential that digitalisation offers.

Research figures are based on a survey of 300 global industrial business leaders carried out by Shell and Edelman Data Intelligence in June 2021