Megatrends That are Challenging the Construction Value Chain
William Boll. Dec 9, 2020. 3 min read.
Core pressures on construction
Cost pressures, labor shortages, spikes in lumber costs, and fixed-bid projects are forcing change across the construction industry.
The article says these pressures are driven by skilled labor shortages, resource scarcity, and environmental impacts.
Major megatrends
- Economic uncertainty.
- Labor shortages.
- Prefabricated and modular construction.
- Energy availability.
- Demographic changes.
- Digital and broader technological revolution.
- Climate change mitigation.
- Waste management.
- Diversity and inclusiveness.
- Worker safety.
Innovation opportunities
- Reduce energy use in buildings and capture some of the value of energy saved.
- Provide comfort for building occupants through building control systems.
- Provide on-site energy production or grid management services.
- Meet demand for low-carbon consumer choices.
- Offer industrialized and streamlined services with lower costs and less burden.
Where innovation can appear
The article says innovation can happen upstream and downstream in the value chain.
- Upstream: product innovation such as super insulating material.
- Downstream: automated monitoring of installation performance.
- Lifecycle ecosystems: collaboration among architects, contractors, and investors during construction.
- Lifecycle ecosystems: building automation for existing households during operation.
Patent and market signals
According to the European Union Commission’s Economic Report, green-construction-related patent filings have tripled in a little over a decade.
The most dynamic patenting areas include HVAC, highly efficient insulation, green lighting, and building-related small-scale renewable energy technologies.
Barriers to innovation
- Uncertain economic and policy outlook.
- Difficulty justifying investment in innovation.
- Risk in developing and deploying new processes or products.
- Need to balance collaboration with knowledge protection.
Strategy and direction
The article argues for a proactive innovation strategy in the construction value chain.
It highlights deregulation, stronger coordination among ecosystem players, and system-led innovations such as building automation.
It also says costs and benefits should include financial value, comfort, health, and the broader social cost.
Nvolve Technologies
Nvolve Technologies says it focuses on transformative and deployable innovation.
It describes its work as supporting green materials, better-built structures using ordinary labor, decarbonization, design/architect/build digitization, mass customization, servitization, circular economy methods, and resource efficiency.