Market drivers

Digitisation

The AEC market has historically been slow to adopt new technologies and invest in computer-based systems. As such the software market is now expected to see significant growth over the next few years as practices change.

Project complexity

Over the last decade project complexity in the construction industry has increased significantly due to the growth in the number of projects of large size and scope, regulatory scrutiny, contractual complexity, and an increasing number of market participants offering specific services.

The proliferation in data creates a challenge for participants attempting to collect and harness information across the project lifecycle. This increasing complexity is driving asset owners and construction companies to consider the adoption of a range of different technologies that enable them to manage this complexity as well as to reduce project costs.1

For instance the use of sophisticated project management and collaboration tools is becoming widespread across the industry, and even smaller businesses are increasingly adopting technology enabled by flexible cloud-based pricing structures.

BIM

The concept of BIM was first developed in the 1970s but began to emerge in its current form in the early part of the 21st century with major vendors like Autodesk leading the way.

Today it has become widespread across the construction market. For instance in the UK, some 86% of respondents to the 2016 National BIM report said they expected to be using BIM on at least some of their projects over the coming year.

The increasing complexity of construction projects, coupled with a move towards cost efficiencies, is driving parties across the construction lifecycle to look to collaborate more closely. Estimates2 indicate that projects typically take 20% longer to finish than planned and are up to 80% more expensive. As such BIM is one part of the solution enabling the construction market to address these issues.

Latest developments in the BIM market include 5D BIM – the inclusion of cost and scheduling elements into the picture – and the move towards Open BIM, described3 as a “universal approach to the collaborative design, realisation and operation of buildings based on open standards and workflows”.

Architecture, Engineering and Construction Software Clearthought – market drivers Image

Mobile technology

A recent study4 found that almost three quarters of construction workers use a smartphone and around half use a tablet for work-related reasons, a dynamic which is significantly driving the demand for products and services that can support and enhance field-based activities.

Almost 80% of those surveyed thought that mobile technology was important to their business, compared to less than 60% back in 2012. In particular mobile apps were no longer viewed as a fad in construction but rather a necessity, and across the provider spectrum there has been growth in field data collection, project management and accounting categories.

Cloud computing

The global cloud computing market has seen tremendous growth over the last decade, while it is estimated5 that last year alone the global software-as-a-service (SaaS) market grew a further 20.3%. Cloud-model solutions are particularly well suited to the construction industry as applications can be easily accessed by a range of users without the need for lengthy implementation processes, and there has been a notable increase in adoption of such tools in recent times.

The market is also seeing significant corporate activity. Last year enterprise software vendor Oracle made a significant investment in the industry with its €950m acquisition of SaaS-model vendor Textura, a provider of contract and payment management solutions. Autodesk, a leading US player which makes software for the AEC market, also announced that it would move all customers to a universal subscription model with mandatory participation.

1 Aconex IPO prospectus 2014
2 Global Projects Database, IHS Herold
3 BuildingSMART, Technical Vision
4 JBKnowledge, Construction Technology Report 2016
5 Gartner forecast: Public cloud services worldwide 2013-2019, 4Q15 update

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