Industry Outlook: Industry 4.0 to Disrupt Construction

Words: Bronzella Cleveland

Peggy Smedleyby Peggy Smedley

You hear it every day. The construction business is changing. You need to be prepared for the technological transformation. Jobsites need to be outfitted with digital technology that will enhance productivity, safety and collaboration. This is all being driven by the potential of Industry 4.0, which takes the IoT (Internet of Things) to the next level. It’s more than just connecting devices to the internet. Specifically, it will impact both construction workers and operators out in the field, as well as building owners.

It will disrupt the construction jobsite. This includes sensors for tracking workers, tools, equipment, materials and so much more. The opportunities are evident. McKinsey & Co. suggests Industry 4.0 has the potential to create value equivalent to efficiency improvements of 15–20 percent.

Before we can talk about how to implement Industry 4.0, let’s take a step back and talk about what it is and how it has evolved. Industry 4.0 refers to the convergence of multiple technologies. It encompasses mobile devices, advanced sensors, 3D printing, data analytics and even artificial intelligence. You name it…the possibilities are endless.

We can’t talk about Industry 4.0 without looking back to the first Industrial Revolution, which dates all the way back to 1760. In the mid- to late 1700s, we saw the emergence of steam power and mechanization to power heavy machinery. Then, in the 1800s, electricity burst on the scene. The assembly line flourished, which enabled mass production of all kinds of goods in factories.

By the 1900s, we saw another Industrial Revolution driven by computers and electronics. This gave workers complete control of machines with just the click of a button. Now in the 21st century, thanks to the IoT, we’ve moved from what we can do for these machines and systems to what they can give back to us. Now it’s about the services and data that are being driven by the fourth Industrial Revolution, which is being ushered in now, thanks to the IoT. The meaning of IoT has advanced to enable technologies that go along with it, like machine learning, augmented reality, robotics and more.

Construction firms are still struggling to determine what to connect, how to connect it, and how to secure all of the assets. What’s more, only 16 percent of firms have a clear strategy in place, according to McKinsey.

The construction industry is desperately seeking more insight and knowledge for how it can best tap into the data. Most of these companies are painfully aware that construction projects across asset classes typically take about 20 percent longer to finish than scheduled, and they are estimated to be up to 80 percent over budget. What’s more, construction productivity has declined in some markets since the 1990s. Cost and schedule overruns are the norm in the construction industry today. With all this in mind, the industry is ripe for change and innovation.

But in order for construction companies to master Industry 4.0 effectively and efficiently, they need to plan accordingly. Construction companies must take full advantage of data from Industry 4.0. This can be seen in two key ways.

First, data at the jobsite. Whether it’s drones, connected tools, robotics or smart trucks, it’s all about extracting the data from the machines and systems to provide workers with information on how to do their jobs better.

Machine learning, wearables, and artificial intelligence with analytics give contractors data about the jobsite. These allow for more accuracy on tasks, alerts on poor maintenance, and insight that will be beneficial in the future. Wearables, for instance, will become an important strategy for construction companies looking to achieve a fully connected jobsite as part of Industry 4.0. Why would contractors want to make wearables a priority?

Wearables offer the opportunity to increase productivity. It’s simply human nature that we tend to rise to the occasion when we know we’re being evaluated, watched or held accountable for what we do. When wearers are being “tracked,” and they know data is being collected, it’s hard not to want to perform their best in whatever circumstance.

A wearable device could have the same effect on improving workers’ safety. For instance, some wearable devices and solutions can monitor a person’s physical condition and, if a health hazard or anything else potentially troublesome arises, the system can alert that person’s supervisor and prompt intervention will occur. In construction, there are many blind spots where this can prove to be very valuable. Among other opportunities, wearables have the ability to transform companies with employee problem solving and training. Construction is dealing with an employee shortage, and this can help to train the next generation of trades.

The second major advantage of Industry 4.0 is predictive maintenance that optimizes maintenance schedules and the utilization of assets, and avoids unplanned downtime. The other side of that coin is the data in the building itself. Long after projects are finished, buildings will continue to feed out valuable information. Much of this comes from installed lighting, water, and heating and cooling systems. The real beneficiary here is the building owner. Building owners have the ability to manage all of these systems at once, thereby cutting costs and maintaining consistency.

Industry 4.0 is perhaps the next chapter in the Industrial Revolution, but it’s only the beginning for construction. Let the disruption begin.

Peggy Smedley is editorial director of Connected World and Constructech magazines, host of The Peggy Smedley Show and Constructech TV, and founder of the Peggy Smedley Institute. As a speaker, strategist, and futurist, Smedley has been part of ushering in the M2M/IoT (Internet of Things) and security era and taking a leading role in helping companies grasp how technology will alter their direction. For more information, visit

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