A Timeline of Tech in the Construction Industry

The Skinny

• In terms of construction, 8 critical technologies have transformed the industry over the past century.
• The first industrialization brought mechanization and steam power to manually-driven construction firms.
• The second industrialization brought mass-production and hydraulic equipment during a critical time period to productivity-strapped firms.
• The third industrialization introduced computers and automation to construction workflows.
• The fourth industrialization is connecting everything and people to deep analytical systems that drive significant value across a variety of metrics.

60 percent of construction leaders expect Industry 4.0 to completely change the way they do business within the next five years. In fact, McKinsey estimates that digital transformation and analytics can increase productivity by 15 percent and reduce costs by 6 percent across-the-board for construction companies. There's tangible value in the "new normal" of construction. But how did we get here?

Today, tech hype in construction is largely centered around three specific technologies:

1. IoT
2. Data analytics
3. Robotics

Yet, a mere two decades ago, the simple computerization of construction equipment was considered cutting-edge and largely leveraged by the upper echelons of Fortune 500 construction businesses. The timeline of construction advancements is accelerating. To put that into perspective, let's look at the eight most important tech advancements in construction over the past century. To help, let's break down these advancements in the context of their place in industrialization. As you'll quickly see, technology hasn't just grown in construction; it's become the heart of the industry.

Industry 1.0

1. Steam Power

The first industrial revolution brought us steam-powered shovels, cranes, and dredges. While we've long-forgotten these archaic machines thanks to hydraulics, steam power rendered significant productivity gains against pulley systems and completely manual processes. We won't dive too deep into these mechanisms, since they're long outdated. But it is interesting to look back at articles published in the late 19th and early 20th century regarding steam shovel technology. Construction was eagerly chasing the same core tenants: productivity, safety, efficiency, and cost-savings.

2. Mechanization

It's hard to capture just how impactful construction mechanization was to the construction industry. In fact, you could argue that mechanization spawned the modern construction industry. The use of machinery retooled the entire industry, reshaping the social and economic platforms of construction and increasing value, and accuracy in the process. To help visualize the value of machines, iron production increased 30x via steam-powered tools during the early 20th century. Today, the total cost of construction machinery accounts for up to 40% of the total project cost.

Industry 2.0

3. Mass Production

The introduction of machinery and machine tools created a unique opportunity for mass-production of materials and parts in construction. While the focus of mass-production in today's hyper-competitive ecosystem is centered on prefabs, the early 20th century was focused on simply producing identical parts en masse without the extremely high costs of human labor. We all know about mass-production in the context of Ford (which popularized the term), but construction was applying mass-production far before Ford opened his auto manufacturing plant. In fact, mass-production was applied to ship construction in the mid 19th century.

4. Hydraulics

From dozers and excavators to graders and power shovels, hydraulic machinery dramatically improved productivity in the construction industry, and hydraulics are still in use today (albeit more advanced hydraulics). We consider hydraulics the most significant advancement in construction outside of data analytics. Construction projects became larger, more ambitious, and much cheaper with the adoption of hydraulics, and the ripple effects of this significant technological advancement forever changed the way construction companies approach projects and generate on-site results.

Industry 3.0

5. Computers

The initial introduction of computers into construction was relatively drawn-out. Despite mass adoption in commercial sectors, construction held out against computerized techniques for many years. Eventually, computer-aided project management systems like PERT and CPM (which were precursors to BIM) were adopted by large-scale construction companies for capital-intensive projects. Today, virtually every layer of the average construction projects is aided by computers at some level.

6. Automation

For construction, automation is a dual-sided concept. Today, automation largely refers to software-enabled automation tools, but in the 1980s and 1990s, automation was typically centered around physical robotics. Originally pioneered by Japanese construction firms (who were worried about the aging population), robotics has been involved in construction for around four decades.

Industry 4.0

7. IoT

Automation and computerization were fantastic innovations, but IoT is taking things to the next level. Every person and machine will soon be transmitting data to deep analytical systems, resulting in unparalleled value for construction leaders. Currently, IoT is semi-broadly adopted, yet poorly optimized. According to McKinsey, a mere 1 percent of IoT data is being fed back into predictive analytic platforms, which McKinsey says will "provide the greatest value" once firms commit to an IoT and analytics-driven future.

8. Analytics

Without a doubt, analytics is the most significant construction advancement that's happened since the first pulley was designed. It helps firms understand contracts, make smarter bidding decisions, drive safety into the heart of their projects, and flip-the-script on how they approach nearly every construction variable. Instead of leveraging past data to infer future decisions, analytics combines thousands of data sourced to predict costs and needs. Imagine being able to predict the scope, cost, return, and value of every project, understand worker needs, and repair and replenish equipment before it impacts the bottom-line. Analytics is a wholly-transformative solution that will change the way we approach construction for the foreseeable future.

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