Friday, 13th December 2019

Construction SMEs risk being left behind by ignoring digital transformation opportunities

More than double the number of larger businesses than SMEs see IT as successfully enabling strategic advantage (57% vs 26%).

SMEs within the UK construction sector risk being left behind by not planning to embrace technology, according to a recent report by Zen Internet, the UK’s largest independently-owned technology service provider. This comes despite a Tech Nation study that reports the technology sector is expanding 2.6 times faster than the rest of the UK economy.

Surveying over 100 IT decision makers across the construction industry, Zen’s Bricks, Mortar and Digital Transformation report found despite traditionally being slow to adopt new technologies, that almost all (94%) of large construction organisations have already started on a digital transformation project. The same cannot be said about SMEs within the construction sector, with just seven in 10 (72%) claiming to be on their digital transformation journey, and 8%, representing over 270,000 SMEs in the UK, not planning to implement a digital transformation project at all.

Digital transformation: The benefits

Although some SMEs within the construction industry have been slow to implement a digital transformation project, there is no shortage of understanding the benefits it could bring, particularly to business processes, the supply chain and employees.

Business process benefits:

  • Improve efficiencies (60%)
  • Help reduce costs (60%)
  • Security (48%)
  • Customer experience (46%)
  • Streamline processes (42%)

Supply chain benefits:

  • Reduce supply chain costs (58%)
  • Increase collaboration with supply chain partners (52%)
  • Increase supply chain efficiencies (50%)

Employee benefits:

  • Remote working (46%)
  • Flexible hours (44%)
  • Enabling more effective systems that improve access to information (42%)

Some of the challenges SMEs feel they need to overcome when it comes to successfully delivering a digital transformation project, include:

  • Access to budget (30%)
  • Poor connectivity (22%)
  • Lack of skills internally (14%)

James Albiges, General Manager – Network and Communications, Zen Business said: “The construction industry has fallen behind other sectors when it comes to embracing digitalisation – and the issue is particularly acute among SMEs. However, SMEs can work to their strengths – being smaller and more nimble means they are well placed to embrace change. Digital transformation opens up access to new technologies that these businesses will not have experienced before. These technologies can help develop new insights on customer usage that frame future projects and boost productivity, helping to put them on a level playing field with larger rivals in the industry.”

A five-year vision

As any digital transformation journey needs to be part of a medium- to long-term strategy, many construction SMEs are already looking at the next five years and how they can gain a competitive edge. Connectivity is key to developing this competitive edge with almost half (48%) of SMEs surveyed believing that 5G would have the greatest impact on a digital transformation project in the future. This was closely followed by improvements in WiFi (46%), and 4G (36%).

Albiges concluded: “The time is right for SMEs that have lagged behind on digital transformation to start on their transformation journeys now. With so many different benefits technology can bring, it can be hard to understand what will best suit a particular business’ needs. The key is to understand what you’re trying to achieve and then get the right technology and culture in place to deliver this. There’s plenty of support to help firms adopt the use of new technology to meet specific requirements. Finding a provider that has the right expertise in delivering successful digital transformation projects has never been more vital.”

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