AI in Construction Management
Artificial Intelligence (AI) is set to fundamentally change the way we work, including the construction industry. Studies suggest that 20% of construction projects run over schedule and 80% run over budget, issues which AI could solve. But what exactly are the benefits and impact of AI in construction project management?
About AI and the Construction Industry
The construction industry is one of the oldest and largest industries in the world. Currently, it hires 7% of the world’s population and over $10 trillion is spent annually on construction-related goods and services. However, the industry is also one of least digitised industries and the second slowest to adopt technology into its practices. A McKinsey report suggests that the resulting loss of productivity costs of $1.6 trillion a year.
However, it’s not hard to see why the construction industry has been slower to adopt new tech. Factors such as the fragmented nature of construction, its dependency on public demand, and its informality, all could contribute to the legacy systems of construction. However, not digitising has resulted in the construction industry suffering from ineffective project management, inadequate skills, and poor design processes. As projects get bigger and more complex, so does the demand for accountability and efficiency.
Artificial Intelligence is likely to counteract many of these problems, and revolutionise the construction industry. It’s not hard to see how AI might be utilised, from automatic calculations to the automation of complex tasks. Therefore, construction managers are looking to AI technologies to economically improve overall productivity, safety, and efficiency.
AI’s capabilities are still vague, so it’s hard to realistically know it’s potential. However, it’s the organisations who embrace AI for what it can genuinely achieve and invest in its future potential. Here’s what we know about the real-world effects that AI will have.
Real world impacts of AI in construction project management
AI will enable extensive integration of construction activities, softwares and practices
Basak Keskin’s research suggests that 60% of construction project managers rank the improvement of data exchange capabilities as the most desired improvement in PPM solutions. One of the biggest challenges to effective project management is data discontinuity, inconsistency, and inaccuracy. Project managers will greatly benefit from AI’s ability to integrate and analyse real-time data.
AI will significantly mitigate risk and improve onsite safety on construction projects
The construction industry always has significant safety concerns, which can both pose risks to employees and projects. Construction project managers can use machine learning to identify patterns and analyse the ongoing risks of the projects.
AI allows project managers to identify trends and patterns that may not be immediately obvious. This provides project managers greater visibility, and therefore a better position to make decisions from. AI will act as the critical bridge between intuition and experience with predictive data. This data can be from both analysis of past projects and accurate risk modelling or analysis of real-time projects. This means any changes to the project can be accounted for, and risks can be mitigated in a timely manner.
Additionally, AI monitoring means that it can analyse photos and videos through wearable sensors and proximity sensors. This can assist project managers in identifying potential safety hazards and send alerts immediately.
AI will streamline cost management
As projects get bigger, keeping a project within budget is becoming increasingly difficult. Like any project, construction projects suffer from inaccurate or delayed reporting and data input, costing financially and resources.
AI can streamline and automate the majority of cost management activities through robotic process automation (RPA) and predictive analysis. By leveraging historic data, AI can make more accurate estimations and calculations, providing real-time reports. In fact, the overall productivity and insight gained from RPA will bring efficiencies in cost management and across the entire construction project.
AI will elevate construction project planning
Planning is one of the most critical aspects of project success. When you consider components such as risks, schedules, and cost estimates, developing a comprehensive project plan for large scale construction projects is complex. As previously stated, AI is particularly useful for predictive analysis, scenario building and contingency planning. Further, machine learning intutively identify patterns and relationships between moving parts of the projects to recommend the most optimal arrangements. These two capabilities of AI will streamline construction project planning, while increasing its accuracy.
AI addresses labour shortages and optimises resources
The pairing of resource management and schedule management is one of the most challenging issues of construction project management. The McKinsey report states that onsite productivity could increase by 50% by implementing real-time data analysis.
Through assistant bots and other forms of sensors and trackers, AI can continually evaluate workloads. This will enable project managers to easily identify and reallocate unused resources to the most optimal activities. This means that every resource is used to its capacity, and reduces any wastage throughout the construction project. Eventually, AI is expected to hold to role of fully automated digital assistants that provide valuable recommendations for resource management.
AI will simplify post-construction activities
Most construction projects don’t simply end when the building is standing. Buildings require continual maintenance and monitoring to ensure any issues do not lead to catastrophic results. By collecting information about the construction, Build Information Modelling (BIM) software can estimate the status and performance of the finished product. This streamlines maintenance activities and reduces the risk of human errors leading to an overall improvement on on-site safety.
Get a head start on Artificial Intelligence
When it comes to AI, those who move first and fast will reap the most rewards. But don’t simply follow the hype of AI. We’ve done the research, and have compiled information to give you a more realistic perspective on the future of AI in project management. Read about the how to prepare your PMO for AI, and how to utilise AI tools in your project management activities. Keep in the loop with all the latest project and portfolio management insight from our PPM expert on our blog!
IIR: Introduce, Integrate, Replace
Step 01
Introduce
You cannot run a portfolio on Excel and PowerPoint alone.
Project portfolio management is the discipline of seeing every project in one place, prioritising the work that matters, allocating people against demand, and governing delivery with real numbers. It is not optional at any serious scale. The moment you have more projects than one person can hold in their head, you need a single, current view of status, schedule, cost, resource and risk.
Excel and PowerPoint feel free because there is no licence conversation. The real cost is elsewhere. It is the hours spent maintaining workbooks, the version confusion, and the numbers that go stale the moment they are pasted.
A spreadsheet cannot tell you, on demand, which projects are at risk, where your people are over-committed next quarter, or how much of the portfolio budget is actually spent.
Introducing a proper PPM platform is the first step. Not to add another tool for its own sake, but to give the portfolio one place where the data lives together and stays live.
Step 02
Integrate
The instinct after buying a PPM platform is to make everyone move into it. That is the fastest way to fail. Project managers already have tools they trust, and finance already has systems of record. Force a migration on day one and you get resistance, shadow spreadsheets, and a dataset nobody believes.
Integrate first. Meet the data where it already is. Two directions matter.
Direction 01
Enterprise systems
Connect to the finance or ERP layer so actuals, commitments and budgets flow in automatically. Reporting stops being a monthly reconciliation and becomes a live view. Nobody rekeys a spend figure again.
Direction 02
The tools PMs already use
The direction most platforms neglect, and arguably the more important. The portfolio should read from the PM's own tools, not force people to abandon them.
The reason this matters is simple. That data is already there, and it is kept current by the person closest to it. When the portfolio reads directly from these sources, the status report updates itself. No chasing, no copy and paste, no reporting lag. The PM keeps working the way they always have, and the board gets a live picture as a side effect.
Step 03
Replace
Integration buys you two things: trust, and live data. Once both are in place, you look at what can go.
Every organisation carries tools and spreadsheets that either do not do the job well or carry a heavy maintenance overhead. The classic example is the resource spreadsheet. It is a workbook someone maintains by hand to track who is on what. It is always slightly out of date, owned by one person, and impossible to reconcile against real demand.
Replace it with the equivalent function in your PPM.
A proper demand management capability does what the spreadsheet was reaching for, with none of the overhead. It models demand against capacity across the whole portfolio, updates as projects shift, and needs no manual upkeep.
Replace deliberately, one function at a time, and only after the platform has earned it. The test is simple: if a spreadsheet is high overhead or low quality, and the platform does the same job natively, retire the spreadsheet.
The payoff
You stop producing reports and start reading them
Follow IIR and the nature of reporting changes. The status view is current because it is fed by the tools people already use and the systems that already hold the money. The overhead that used to consume the last week of every month disappears, because there is nothing to assemble.
That is the whole point of real-time reporting. Not a prettier deck, but a portfolio you can look at any day of the month and trust, at a fraction of the effort it takes today.
Built on Microsoft 365. Native ground for IIR.
pmo365 integrates with the tools your teams already run in, so the path from Introduce to Integrate to Replace is a natural progression rather than a rip and replace.