A new report, Construction in a digital world, by the Canadian Construction Association (CCA) and KPMG in Canada, identifies significant opportunity for Canadian construction firms to adopt innovation.
As many as 75 per cent of construction firms surveyed by CCA and KPMG rated their digital maturity as fairly low relative to their competitors, the report finds. Further, almost three in five admit their organization "needs to moderately or considerably" adapt their digital strategy, with most unsure about which technologies and applications would offer them a competitive advantage.
"The industry is on the cusp of digital transformation with leading firms already adopting technology – from analytics to drones, robotics, 3D printing, and augmented reality – to yield improved productivity, safety and decision-making," says CCA President Mary Van Buren. "Our survey reveals, however, that smaller and medium-sized firms are not yet capitalizing on the benefits technology can bring. For many contractors, the low bid model simply does not allow for innovation or to invest in new technologies."
While some firms have invested in digitizing their front and back-office operations to reduce redundancy, cost and improve the employee and customer experience, the report suggests there is even greater opportunity to be gained from embracing technologies, such as predictive analytics, building information modelling (BIM), digital twins, wireless monitoring and autonomous equipment, and augmented reality (AR).
Construction companies embracing digital transformation will achieve greater efficiency, generate substantial productivity gains, improve onsite safety for workers, reduce the cost of goods sold, and modernize operating models, the report says.
"Digital innovation is a continuing process, not an end game," says Lorne Burns, KPMG's National Industry Leader, Building, Construction and Real Estate, based in Vancouver. "Many construction entities rely on legacy systems, and those that improve their competitive positioning will use this time as an opportunity to integrate disparate systems and adopt new ways of operating."
Too often, companies implement a technology concept or software package to reduce costs or get a quick payback on a single project only to leave the tool with that project and never use it again. This issue is compounded when a company grows through acquisitions, each with their own set of legacy technologies, the report says, pointing out the necessity of having an integrated strategic digitization strategy.
A deep dive into technological adoption in Canada’s construction industry
Technological adoption in Canada’s construction industry
Across Canada, CCA represents more than 20,000 member firms drawn from 63 local and provincial integrated partner associations. CCA gives voice to the public policy, legal and standards development goals of contractors, suppliers and allied business professionals working in, or with, Canada's heavy civil, institutional, commercial and industrial (ICI) construction industry.
The construction sector is one of Canada's largest employers and a major contributor to the country's economic success. The industry, 70 per cent of which is made up of small and medium-sized enterprises (SMEs), employs more than 1.4 million Canadians and contributes 7.5 per cent towards Canada's Gross Domestic Product (GDP).
About KPMG in Canada
KPMG LLP, a limited liability partnership, is a full-service Audit, Tax and Advisory firm owned and operated by Canadians. For over 150 years, our professionals have provided consulting, accounting, auditing, and tax services to Canadians, inspiring confidence, empowering change, and driving innovation. Guided by our core values of Integrity, Excellence, Courage, Together, For Better, KPMG employs nearly 8,000 people in over 40 locations across Canada, serving private- and public-sector clients. KPMG is consistently ranked one of Canada's top employers and one of the best places to work in the country.
The firm is established under the laws of Ontario and is a member of KPMG's global organization of independent member firms affiliated with KPMG International, a private English company limited by guarantee. Each KPMG firm is a legally distinct and separate entity and describes itself as such. For more information, see home.kpmg/ca.
For further information:
Vice-President, Public Affairs, CCA
(613) 236-9455 ext. 102
Caroline Van Hasselt
KPMG in Canada
Rallying multi-generational strengths
"The next generation understands that digital adoption and ESG strategies are necessary to sustain business operations and achieve future business and family goals," says Daniel Trimarchi, Director, Family Enterprise Advisory, KPMG in Canada. "Overall, the pandemic accelerated conversations within families on governance to enable faster decision-making on these types of issues and better engagement with family members and shareholders.
According to a 2019 report by the Family Enterprise XChange Foundation, family businesses accounted for approximately 7 million jobs in Canada, 90 per cent of the employment generated by small and medium-sized companies, and nearly 50 per cent of private sector gross domestic product.
"Given how much economic impact family-owned business have in Canada, their ability to rebound strongly and achieve their full potential will be a powerful factor in revitalizing our economy," adds Archambault.