Knowledge is power: risks and opportunities of using AI

The AI revolution is often perceived as a leap in computing, but it is, at heart, a knowledge revolution.

Large language models (LLMs) can understand and generate text because they have been trained on a significant portion of entire internet, including books, articles, and websites.

As a result, LLMs can understand the deeper nuances of language and knowledge.

These models can extract, structure, and understand knowledge from a wide range of sources such as project reports, site photographs and event hand-written notes.

This is critical given that over 80% of business data is unstructured i.e. cannot easily be placed into tables (reports, images, videos, etc.).

The industry doesn't understand what AI is

The construction industry (the least digitised sector) has seen only a 1% productivity increase over the past two decades.

It also faces a significant shortage of engineers, with a projected gap of one million engineers across all disciplines by 2030.

The reasons for this are complex, as are the reasons why it has historically been difficult to develop useful AI systems in the sector.

In short, we don’t really have a handle on what AI is and why it’s useful.

What AI can do

In a nutshell – AI can be used to curate, understand and apply knowledge that is currently kept in technical manuals, standards, previous projects, and past lessons.

A well-designed AI system could significantly improve productivity across an entire company because it enables you to capture and apply knowledge from past and present projects.

Considering the typical current single digit profit margins, there’s a genuine opportunity for a substantial increase in profits across the entire sector.

Future market dynamics

As AI evolves, its role in the construction industry will expand.

The adoption of LLMs will usher in a new era of generative engineering, where humans will rely on AI for finding and applying the right knowledge to solve complex problems.

AI will transform project management, design processes, and eventually complying with design standards.

Risks and opportunities

Small- and medium-sized enterprise (SME) consultants

Moderate risk:

• Agile and can quickly integrate AI, but less able to weather market forces.
• Limited resources to integrate AI, high initial investment.
• Vulnerable to market changes.

High potential:

• Can leverage AI to offer advanced niche services that build on their specific knowledge and skillset.
• Done well, will enable them to compete with larger firms and increase market share.

Large consultants

Moderate risk:

• Existing models based on billable hours face disruption.
• Resistance to change within established processes.

Moderate potential:

• Need significant investment to integrate AI but can lead market transformation.
• Can leverage existing client relationships and provide enhanced services with AI-driven insights and recommendations.

Contractors

Lower risk:

• Need to upskill workforce and invest in new technologies.
• High costs for upskilling, initial resistance to adopting new technologies, potential job displacement.

Moderate potential:

• Can enhance project management and delivery efficiency through AI.
• Improve safety and compliance on job sites.
• Achieve cost savings through streamlined operations and reduced project timelines.

Clients

Lower risk:

• Benefit from improved services and cost savings.
• Convincing stakeholders of AI benefits.
• Depending on service providers for AI integration.
• Navigating the shift in service models.

High potential:

• Access to better, faster, and more transparent services.
• Faster project completions, better quality, and improved decision-making with real-time, validated data.

Staying competitive

The AI revolution will transform the construction industry into a knowledge-driven industry.

LLMs' ability to extract, understand, and apply information is unlocking new opportunities for generative engineering.

This transformation will lead to more efficient, cost-effective, and sustainable construction practices that will reshape the industry dynamics.

As AI continues to evolve, its integration into the construction industry will drive innovation.

It will set new standards for excellence and ensure the sector remains competitive and resilient in the face of future challenges.