KPMG International recently published its Global Construction Survey 2013: Ready for the Next Wave? The subtitle refers to the next wave of mega-projects expected as a result of economic recovery, growing urbanization and demand for infrastructure.
KPMG interviewed 165 senior executives from construction and engineering companies in 29 countries, with annual revenues ranging from US$250 million to more than US$5 billion. The companies represented serve a number of vertical markets – including energy, power, industrial, healthcare and pharmaceuticals, manufacturing, mining, education, and government. 52% of respondents are based in Europe, Middle East and Africa, while 28% are in Asia Pacific and 19% are in the Americas.
Mixed Views on Risk Management
The survey’s key findings include the following points:
- 66% of respondents believe that the infrastructure development plans of national governments will be the most influential market driver, followed by economic growth, urbanization and population increases
- 56% indicate that effective management of mega-projects is critical to industry growth
- Power and energy are the key sectors to watch, followed by water, rail, mining, and roads and bridges
- 81% believe that efficient risk management is the most important factor in industry growth
- 79% are satisfied that their investment in risk management has been successful
- 77% report underperforming projects due to delays, poor estimating processes and failed risk management processes
Standardizing Processes
In line with these findings, KPMG summarizes the respondents’ recommendations with direct quotes:
- The scale of infrastructure projects is increasing, and companies have to step up accordingly.
“We must have the right people in the right location to participate in mega-projects that result from new opportunities, as energy costs decrease. The key to success is how these projects are obtained and managed.”
- Many of the controls appear to be in place. Now it is time for contractors to make sure that people are fully aware of and observing these procedures, and that management has an enterprise-wide view of risk.
“We need to get more people to follow the [risk management] process. We must ensure people think of risk management as a fundamental part of the construction process and have it top of mind at every stage of work.”
- Standardization has been an important goal that contributes to project and risk management.
“The [standardization] process is ongoing, and is a difficult challenge as every project is different. Whenever new people start on a project, they bring with them different processes.”
- To spread good practices, contractors can increase their use of project management software and step up training.
“Build efficiency and controls, consolidate project delivery, and tighten all leakages as much as possible.”
Project Collaboration: Systems + Culture
A recurring theme in the KPMG survey is the requirement to map human behavior to the application of technology.
Project collaboration and management systems are available to standardize information and processes across diverse, multi-company teams. For example, the Aconex Online Collaboration Platform has been deployed on more than 14,000 projects globally. Ease of learning and use on one end – coupled with project delivery success on the other – has driven adoption rates estimated to be 11 times higher than those of comparable systems on the market.
Project leaders – owners, developers, contractors, and project managers – need to ensure that every member of their team is using whatever system is deployed throughout the project. This is a by-product of creating a collaborative project culture that is conducive to effective risk management and successful project delivery.
What Do You Think?
Check out the KPMG survey and let us know what you think. More importantly, be sure you’re ready for the next wave of mega-projects with the right system and culture.
