Uncertainty is Here to Stay, But How are Savvy Contractors Managing It?

By René Morkos

For the past two years, the construction industry has been plagued by a whole new level of uncertainty. First, we had the arrival of COVID-19, a pandemic that has radically affected both the ways in which teams work and the availability of labor. Next, we began feeling the pain of problems with the global supply chain, problems that have impacted the availability of key inputs (e.g. timber, steel) and the price of those critical building materials. And most recently, we’ve started to feel the bite of inflation, which has compounded the pricing challenges introduced by supply shortages and has made it increasingly difficult for general contractors to hit their cost forecasts and to maintain projected project profitability.

For construction companies building large-scale projects – from highways and bridges to multi-use and airports – the complexity of these projects is enormous, and the result of all this uncertainty is radically increased risk. Their essential question is: how can they decrease this risk?

Savvy contractors are turning to tech. They are using construction technology to find ways in which they can be more flexible and “roll with the punches” that uncertainty brings us.

The technology that is core to enabling this new, required degree of flexibility is artificial intelligence. The part of the construction lifecycle to which AI is being applied with greatest impact is the construction schedule.

During the bidding and preconstruction phases, contractors have typically used “old school” tools like Microsoft Project, P6, and even Microsoft Excel to develop detailed construction schedules. This is a labor-intensive process and it is not designed to deal easily with changes, as revising construction schedules created with these tools is as painful and time-consuming as creating them in the first place.

These shortcomings become even more damaging during the construction phase of a project. As we all know, major construction projects regularly run behind schedule. When they do, it has historically been difficult to experiment with alternative paths and find a way to claw back the lost time. Here again, the traditional tools simply aren’t up to the task.

But AI tools can provide contractors with the ability to be nimble that they have long lacked in creating, managing and adjusting construction schedules. By allowing contractors to run “what if” analyses during preconstruction, they can allow them to see what could happen if certain problems arose – for example, “What if my shipment of windows arrives late?” They can also create thousands of potential schedules and then zero in on the one that will best help them manage risk.

Contractors can also use AI to help them stay flexible during the bid itself. When things go awry – as they inevitably do – the tech-savvy contractor can use AI to schedule around project delays and recover a blown schedule.

ALICE Technologies has been a leader in bringing the power of AI to construction and companies around the world have put it to work at all stages of the construction process. In San Francisco, for example, Build Group used ALICE to challenge the construction schedule it had developed for the 5M Project. Located in a dense urban environment between San Francisco’s SOMA and Mid-Market neighborhoods, the 5M Project would transition the site from a mix of office buildings and surface parking lots to a balance of residential, office, retail, cultural, and open space. With ALICE, Build Group was able to create hundreds of alternatives to its original schedule, ultimately selecting one that both reduced risk and trimmed construction costs.

In another recent project, ALICE Technologies worked with a major contractor on a rail project that was running behind schedule due to COVID-fueled labor shortages. Using the ALICE platform, the contractor was able to quickly revise his troubled schedule. In doing so, not only did they tune the schedule in a way that recovered the time lost, but they were also able to create a construction plan that delivered the project more than 80 days ahead of the original P6 schedule.

The level of uncertainty for large contractors is unlikely to get better any time soon. The rewards associated with working on major projects here can be significant, but the risks can be equally high. To mitigate these risks, sharp contractors are turning to technology –  specifically to artificial intelligence. And they are focusing their new-found tech power on the aspect of construction that has previously been the most inflexible: the construction schedule. AI is blowing up the old model of scheduling and is finally enabling general contractors to respond quickly to changes in their operating environment. And if your firm has not discovered this new opportunity for agility, now is the time to explore how AI can help you to best weather the ongoing uncertainty that undoubtedly lies ahead.

About the Author

René Morkos is the founder of ALICE Technologies and is an adjunct professor at Stanford University’s Ph.D program in construction engineering. Morkos obtained his Ph.D. in artificial intelligence applications for construction as a Charles H. Leavell fellow at Stanford. He is a second-generation civil engineer with over 15 years of construction industry experience that is divided between industry and academia. Morkos’ professional experience includes working as a project manager in Afghanistan, underwater pipeline construction, automation engineering on a $350 million gas refinery expansion project in Abu Dhabi, ERP system implementations, and various Virtual Design and Construction projects.

This material appears in the April 2022 issues of the ACP Magazines:

California Builder & EngineerConstructionConstruction DigestConstruction NewsConstructioneerDixie ContractorMichigan Contractor & BuilderMidwest ContractorNew England ConstructionPacific Builder & EngineerRocky Mountain ConstructionTexas ContractorWestern Builder