InEight Inc., a global provider of construction project management software, has launched its second annual Global Capital Projects Outlook. The Outlook draws insights from research conducted with 300 of the world’s largest capital project owners and contractor construction professionals across the Americas, Europe and APAC.
The research reveals that 96% of respondents are either very or fairly optimistic about their organisation’s growth prospects for the next year, up from 92% in 2021. Digital technologies (57%) and data collection, analytics and insights (53%) offer top opportunities for growth, however almost all (93%) respondents said that their experience of change management left room for improvement, signalling a need for a more sophisticated, human-centric approach to technology implementation.
Of particular concern, respondents identified uneven or sporadic implementation (58%), process and data integration issues (54%), poor communication (51%) and technical and system limitations (51%) as the top frustrations caused by technology implementation.
Similar trends were also identified when asked about barriers to greater technology investment, with respondents identifying the challenge of integrating with existing systems, and a lack of technically skilled talent to smooth the process, as key issues.
Commenting on the Outlook, Jake Macholtz, CEO, InEight, says, “Everyone we speak to is talking about growth opportunities for both owners and contractors. The optimism, resilience and confidence of the industry is almost tangible it’s so strong. This is especially encouraging given the economic backdrop organisations are operating within and the implementation challenges associated with digital transformation. It seems to be that the prospect of leveraging digital technologies to build a better world is keeping spirits high.”
The Outlook found that respondents see digital technology as broadly helpful in their day-to-day roles. Of most benefit: gaining detailed and holistic information on projects and events (51%), prioritising tasks/managing project workflow (50%) and giving reassurance that environment, health and safety (EHS) policies are being followed (54%).
However, highlighting the need for a human-centric approach, 94% of respondents said they have specific concerns about the future of digital transformation. Reduced in-person communication (45%), professional experience and human intuition being replaced by technology (43%), damage to work-life balance (41%) or the replacement of jobs by automation (39%) were all front of mind for respondents.
When asked what benefits they hoped digital transformation could deliver in future, respondents said more automation (49%), more control (48%), greater strategic insights (47%) and better communication (49%).
“Respondents are clear on the benefits of digital technologies and eager to realise this new vision of the future but right now the industry is falling short when it comes to managing organisational change, making digital transformation unnecessarily arduous,” Macholtz says.
A tenuous operating environment
Against a backdrop of supply chain shortages, inflationary pressure, energy challenges, and war in Ukraine, capital project owners and contractors are unshakably positive about the direction of the industry. Notably, respondents reported a significant increase in construction and capital projects spending (up from 68% last year to 76% in 2022) while resilience also remains high, with 91% of respondents considering their organisation to be very or fairly resilient.
However, in a departure from last year’s Outlook, the completion of projects on time and on budget has fallen dramatically. On schedule completion, as reported by contractors, has fallen 16% year-on-year from 51% to 35%, while completion on or under approved budget has also fallen from 51% to 38%. Owners are yet to see quite the same impact, reporting 43% of projects completed on time, and 45% on budget.
Underlining the tenuous global operating environment, respondents highlighted unmanaged or unexpected risk as the most influential factor on whether a project will be completed on time and to budget.
To access the full report, visit ineight.com/annual-global-capital-projects-report.