AEC Innovation, Disruption & Productivity — Part 1 of 6
If you give two #ConstructionDorks ninety minutes to present at an industry technology conference, the presentation can go a lot of different ways. I had the pleasure of presenting with Travis Voss, Technology Manager for Mechanical, Inc., on the topic of “Next-Generation BIM Workflows” at the MCAA Technology Conference. (Travis is awesome!) As we were preparing, we posted a graph on LinkedIn that caught some interest and several commenters asked us to post the presentation. We’ve broken the slide deck out as images and will be posting them with commentary as a series of articles, which we’ll release over the next week or so. We hope people find our work compelling.
There will be six articles. (Did I mention it was a ninety minute presentation?) The outline is as follows:
- Part 1: Core Concepts & Definitions
- Part 2: Venture Capital — It’ll be a VERY BIG DEAL
- Part 3: A Different Look at “Teicholz” Productivity Curves
- Part 4: Why Everyone Should Use Game Engines
- Part 5: AEC Design & Root Cause Analysis
- Part 6: Roadmap for Manufacturing Processes in AEC
Part 1: Core Concepts & Definitions
We start by defining terms that we use a lot and terms we find helpful. Of course, you can go on Wikipedia and get an exhaustive complete definition of disruption, innovation, technology stack, etc. But we want simple, concise, and relevant to architecture, engineering, and construction (AEC).
The key takeaway that isn’t often discussed is that consumers win when disruption happens. Disruption is a business model change and value shifts between the disruptors and the incumbents. But consumers benefit from the change. I don’t miss the cab drivers and dirty cabs that were replaced by Uber. To me, that change benefited me. This is important to remember because AEC consumers — the owners, tenants, and other stakeholders who use what we build — will benefit once disruption finds the AEC industry.
Talking about innovation is like dancing about architecture — open to interpretation, abstraction, and personal preference. The mental model shown on the next slide is probably a better way of looking at it.
This shows the three parts of innovation. Some would call the first step “ideation” or some other fancy word. It doesn’t really matter what you call it because that step is really unimportant. Ideas by themselves are cheap. Execution is key because it turns ideas into value. Execution is a project management process where you manage the creation of a product, process, or service. That new thing then creates value.
The big takeaway here is that all three steps take skill. Doing innovation frequently makes you better at innovation. It’s like compound interest.
There are two pitfalls or misconceptions about innovation. The first is what we call a “SQUIRREL!” moment. Imagine a dog seeing a squirrel, shown here as a border collie. The pup is focused on GETTING THE THING, not what to do with the thing once you have it, or what value it provides. We often see construction companies buy drones without thinking about process or value. We think blockchain tech in AEC is also full of SQUIRREL! moments.
The other pitfall of innovation is what we call “Black Swan Hunting.” Black swans are rare events, as defined by Nassim Nicholas Taleb and popularized by Malcolm Gladwell. People often attend conferences, looking for that next breakout company. This is hunting for a rarity and ignores the progression of technology. Technology relies on other technology, so you have to look for constant incremental change and how the sum of the changes results in a major advantage.
You can ask any tech industry professional the question, “What is your tech stack?” and you’ll get back an ordered list of technology platforms, services, and products. In AEC, we don’t use this type of terminology — we’re more likely to say, “Yes, we use Revit.” Thinking in terms of tech stacks has many advantages. Your firm’s stack is unique to your work, you can talk concisely about why you’ve chosen your platforms, and it inherently implies integration. Technology managers manage the tech stack.
You can easily make a tech stack confusing. In general, any part of a good tech stack can connect to any other part, which means the lines between these boxes aren’t really important. This chart was made for a particular purpose but is not the type of graphic that should go in front of a client. It should be noted, however, that simplifying this graphic into a linear representation would show a “pipeline”, a term used in other industries. For example, rendering pipelines in graphics and animation.
Correlating a few of the thoughts, drones are an example of a non-Black Swan technology stack. Drones are a bunch of systems and incremental improvements to each system over time have made drones possible. Batteries, for example. I remember NiCAD batteries from model airplanes as a kid. They were heavy and weak. We needed LiPO’s to make drones work.
So that’s Part One. I’d say the rest of the presentation is more compelling, engaging, and interesting. But there’s certainly value in thinking about AEC technology in terms of tech stacks. Diversification of tech stacks is really important and a key part of disruption and innovation.
In Part Two, we’ll use a non-AEC industry as an example to imagine how venture capital will dramatically change the AEC industry in the very near future. We think change is imminent and will come very fast.
Part 2: Venture Capital — It’ll be a VERY BIG DEAL.
This article was originally posted on LinkedIn on February 6th, 2019.
