During the pandemic, companies have stepped up investments in technology to communicate remotely with customers and keep their businesses running. As well as boosting efficiency and profitability, it also creating investment opportunities in previously overlooked areas.
Old dogs learn new tricks
Giant technology companies, such as Microsoft, have been among the main beneficiaries of turbocharged demand for online services. In the retail sector, meanwhile, online sales in the US increased 32.4 per cent in 2020, as consumers who had previously been slow to shop online, such as the over-65s, logged in.
Businesses are finding new ways to link the physical and digital worlds
But companies in other sectors have also sought to accelerate investment in digital solutions. Among them are firms that have traditionally lagged in this regard, such as construction and manufacturing. It is, after all, much harder to apply online technologies to a construction site or assembly line than to a trading floor or classroom. But with necessity being the mother of invention, businesses are finding new ways to link the physical and digital worlds with new design tools and connected machinery.
Construction goes digital
Take construction. This most physical and tangible of environments is rapidly being transformed by data and virtual design.
Construction firms have long been hampered by low productivity. Even well-run firms regularly deliver projects late and over budget. Added to that, an estimated 20 per cent of the global construction workforce is set to retire over the next three years – a big problem in an industry that has traditionally struggled to attract recruits.1
The crisis has spurred investment in digital tools that promise to improve productivity
The pandemic has, in some cases, shut down construction sites and cast uncertainty over schedules, presenting further challenges. But the crisis has also acted as a spur to investment in digital tools that promise to improve productivity by cutting waste and boosting efficiency.
Firms now fly survey drones over a site before the build starts, gathering images to generate maps, which are then fed to smart bulldozers. As the vehicles move, they collect information, which is fed back to office-based teams so progress can be monitored remotely.
The savings in cost and material waste can be substantial. One company recently found the use of such technology sped up road excavation by 44 per cent and improved accuracy by 75 per cent.2
As more companies embrace digital methods, the industry could become cleaner and more efficient – an important consideration given that building and construction account for 40 per cent of the world’s carbon emissions. That makes it one of the principal contributors to the climate crisis, according to the United Nations Environment Programme.
Meanwhile, manufacturers of components such as elevators, air-conditioning units and door locks can take advantage of improved online links to monitor performance and offer maintenance before problems arise, minimising disruption for a building’s owner and tenants. For their part, such manufacturers are able to retain lucrative service contracts.
Industrial manufacturing and the next industrial revolution
Experts have talked for years about a ‘fourth industrial revolution’, and the advance of new technologies. But it is only now that companies are beginning to fully appreciate the potential, as 5G improves connection speeds and the pandemic forces companies to devise new ways of working.
Companies are beginning to fully appreciate the advance of new technologies
These include the use of cutting-edge technologies such as artificial intelligence and augmented reality (AR). As products such as cars and aeroplanes increasingly resemble computers, so the factories that make them become increasingly advanced.
Engineers at the US defence and aerospace business Lockheed Martin, for instance, build F35 fighter planes and NASA spacecraft wearing AR glasses equipped with sensors and cameras, which display virtual renderings of components with instructions on how and where they should be installed. The glasses have improved accuracy and allowed engineers to work 30 per cent faster, bringing substantial savings in labour costs.3
Three points to remember
- COVID-19 has underlined the importance of digital technologies. Companies that have failed to do so are falling behind their competitors.
- Even businesses in areas where it was thought hard to adopt new technologies, such as construction and manufacturing, are now embracing them.
- New technologies are boosting efficiency and profitability, creating opportunities for investors.