The new digital landscape: Managing risk and building resilience
In this episode, Clyde & Co Partner Dino Wilkinson speaks to construction specialists, Mary Anne Roff and Sean Hardy, along with technology specialist, Tom Tippett, about how construction is shaking off its reputation as a traditional, paper-based industry, to embrace digitisation.
Kicking off the discussion, Roff and Hardy explain that two tiers of construction companies have emerged during the pandemic; those who have pushed digitisation aside, and those who see innovations such as Building Information Modelling (BIM), advanced data analytics, and biometrics, as a way of overcoming the challenges they have faced. Meanwhile, Tippett believes that increasingly accessible and attractive technology has also played a part: “There is an increasing requirement to use technology to work smarter, plus it is becoming much cheaper, so is being used more readily," he says.
With many construction firms and consultancies pivoting their focus to incorporate digital expertise, Hardy explains that lawyers serving the sector are now being asked to get to grips with these new technologies, and the risks and opportunities involved. “We’re increasingly bumping into software and data aspects, be it at the tender stage, project delivery, or during a dispute,” he says.
Examples are numerous. Roff explains how IoT sensors are being used to show the impact of adverse weather on construction timelines, enabling more accurate risk management, and paving the way for contract and payment automation. Meanwhile, in Asia Pacific, Hardy is seeing sensor technology being applied in tunnelling projects, enabling excavation speeds to be predicted and monitored more accurately, with significant implications at the tender stage.
At the heart of both these examples is the role of data, and Tippett goes into detail about the legal and regulatory hurdles involved in technologies such as the Internet of Things (IoT) and robotics. For lawyers and their clients, he says, increasing volumes of data can mean navigating a “spider’s web” of issues, such as the risks of storing it in the cloud, sharing it with third parties, and balancing the requirements of numerous stakeholders. Crucially, he says, clients need guidance on developing a data strategy as early as possible, to avoid any nasty surprises.
The issue of fragmentation in the sector is also discussed, particularly as many smaller firms are currently less inclined to embrace digitisation. According to Roff, this is a significant challenge, and ensuring collaboration across the supply chain will be key to maximising the effectiveness of digital initiatives going forward. “Construction projects involve a multitude of companies and sole traders, and this impacts the ability to embrace technology. Getting people to move at the same pace is hard,” she says.
With digital momentum in the construction sector increasing all the time, all three guests agree that lawyers need awareness of the key technologies, and what they mean for client risks and liabilities. While it may seem complex and daunting to non-tech experts, Roff reassures listeners that it is possible to build a basic understanding while knowing where to seek advice from technical experts when required. And for those who take the lead, exciting opportunities await, supporting clients with some of the biggest challenges they’re currently facing.
This podcast forms part of the Digital Transformation podcast series.