Why the Future Will Require Buildings as Products

Opinions have been widely expressed that the construction industry doesn’t innovate from within very well. Because the cost of constructing built assets and infrastructure has increased faster than owners can recoup their investments, the economics of construction as it exists now seem more and more untenable.

If we look at other industries, there are companies developing innovative systems to deal with problems similar to the ones the construction industry is facing – supply chain, labor shortages, compressed schedules, and smaller budgets. One of those innovations that is adaptable to the industry could be technology for providing buildings as products, rather than one-off designs.

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Generally, owners want a reliable, sustainable asset delivered quicker and less expensively than even a decade ago. Figuring out a way to deliver a “product” with limited customization that fits those criteria would result in owners being able to buy buildings as products. Unfortunately, because of a lack of standardization, the day when that is commonplace is still a ways off.

The demands being placed on the construction industry include rapid production of built assets and infrastructure projects. Construction companies that can standardize their systems and workflows can find themselves ahead of the curve and more likely to survive this shift in design and construction systems – truly a fundamental change in the industry.

Of course, unique building designs that are not mass-produced “products” will still be needed. But for the sake of sustainability and productivity, they will need to be the exception rather than the rule. The more complicated and unique a building is, the more expensive and the less sustainable it is to build. In addition, the pressure to produce more with less will no longer accommodate a “one-off” method of producing buildings. As an article on the Lean IPD blog explained, “Think about large-scale housing and healthcare that is financially sustainable. Right now, traditional processes are not enabling large-scale unit economics.”

The construction industry can achieve some economy of scale, but that won’t expand much unless more companies offer solutions that can be mass-produced. These industrialized solutions can capitalize on the gains that are inherent in a manufacturing process, which reduces expenses on features that don’t add value.

This is already happening on a small scale. New start-ups are disrupting the industry with new approaches, such as developing productized building elements, modular and prefabricated systems that can be manufactured consistently and delivered to market rapidly. Data centers, laboratories, hotels, fast-food, warehouses, healthcare facilities, and precast bridges are examples of projects being developed using industrialized construction.

Manufacturing techniques used in construction can improve efficiency, help build at scale, improve quality, and reduce costs. With these promising achievements, the economics of construction moving into the future seem more plausible and promising.

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