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1、2023 Global Construction Survey Familiar challenges new approachesForewordThe 2023 Global Construction Survey finds the industry in a cautiously optimistic mood,as the combination of widespread government infrastructure stimuli,the renewable energy revolution,increasing capital investment in strateg
2、ically important sectors,and a post-COVID-19 pipeline create excellent opportunities for engineering and construction(E&C)companies.At the same time,the industry faces a continuing volatile environment,with continued supply chain disruption,rising inflation of energy,materials and wages,labor shorta
3、ges and a possible recession,which could have a major impact on certain subsectors.Meanwhile,the perennial challenges of poor project performance,low productivity,and costly major project failuresand high-profile industry bankruptciescontinue to dog the sector.Environmental,Social,and Governance(ESG
4、)presents both opportunities and risks.On the positive side,the shift to a low-carbon,biodiverse,circular world can drive infrastructure and construction spend and bring competitive advantage,improved ROI for forward-thinking,diverse,and purposeful businesses,who should be top of the queue for both
5、capital and new talent.However,ESG also brings rising scrutiny and compliance requirements,as well as pressure to reduce embodied and operational carbon footprint,waste and pollutionat pacethat could be costly and presents significant and multi-dimensional obstacles.The technology dilemma persists,a
6、s both project owners and,particularly,E&C companies ponder where to invest and how to find the substantial sums needed to become digital leaders.Some of the key breakthroughslike modular/offsite manufacturingare still relatively low-tech and,if not widespread,are definitely gaining momentum.Accordi
7、ng to our survey respondents,the proportion of projects using 50 percent or more modular/offsite manufacturing is set to rise from 14 percent to 28 percent in the next five years(see Exhibit 19).And the looming specter of big tech casts a perpetual shadow over an industry ripe for disruption,as trad
8、itional players face the threat of convergence,and losing market share to more digital-savvy interlopers.This is KPMGs 14th Global Construction Survey,and the biggest to date,containing the insights of nearly 300 E&C firms from around the globe.Thank you to all those who took the time to participate
9、 in the ongoing debate about how to advance an industry that plays a huge part in all our lives and can be an incredible force for good.Geno Armstrong Global Lead and Principal,Infrastructure,Capital Projects,and Climate Advisory KPMG in the USClay Gilge National Lead and Principal,Infrastructure,Ca
10、pital Projects,and Climate Advisory KPMG in the USKevin Max Principal,Infrastructure,Capital Projects,and Climate Advisory KPMG in the US Suneel Vora Partner,Business Consulting Capital Projects and Industry 4.0 KPMG in India 2023 Copyright owned by one or more of the KPMG International entities.KPM
11、G International entities provide no services to clients.All rights reserved.0203040506201ContentsView from the industry:Reducing wildfire risk in CaliforniaSurvey at a glanceProfitable,sustainable growthor boom and bust?View from the industry:Driving continuous improvementThe rising influence of ESG
12、View from the industry:At the forefront of sustainable constructionThe great innovation raceKey takeawaysAbout the surveyThe KPMG Global Engineering&Construction practiceView from the industry:Embracing modularization and digital technologiesView from the industry:Building supply chain resilience 20
13、23 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.0203040506301 Two-thirds(66 percent)of respondents are optimistic about the direction of the construction market,and 78 percent feel infrastructure stim
14、uli will have a positive impact.Yet project performance remains in the spotlight,with only half of owners saying their projects are completing on time and 87 percent stating that projects are coming under greater scrutiny.To address ongoing volatility,the biggest priority is improving estimating acc
15、uracy,transferring risk,and increasing innovation.Survey at a glanceAddressing industry performance challengesRising influence of ESGThe great innovation race ESG has climbed construction leaders agendas,with 54 percent“fully envisioning”the benefits of ESG and aggressively pursuing maturity.Survey
16、respondents say the key benefits of ESG are reputational improvement and competitive advantageas well as a necessity to enhance access to project capital Diversity,equity,and inclusion(DEI)is the third most important factor determining future success,as the sector shifts away from its hard-hat image
17、 toward greater use of technology and more remote working.Owners are relatively more concerned with reducing greenhouse gases(GHG)while E&C companies place the highest priority on DEI.Embodied carbon(carbon released during the construction process)is a growing concern and is likely to be the subject
18、 of future regulations.The construction industry is starting to embrace the power of technology to transform performancewith 81 percent of E&C firms adopting mobile platforms,43 percent using robotics process automation(RPA)and 40 percent adopting artificial intelligence(AI)although many are in the
19、early stages.When it comes to improving ROI on capability projects,project management information systems(PMIS),building information modeling(BIM),and advanced data analytics are considered to have the greatest potential;digital twins,modular/offsite manufacturing,AI,and BIM are driving the greatest
20、 gains in project performance.A vast majority of respondents say prefabrication is an important solution for capability projects,although just one-quarter of E&C companies use modular manufacturing across all projects.Theres growing recognition of the power of technology to improve safety,notably fr
21、om use of D&A and modular manufacturingthe latter reduces dangerous,onsite work.2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.0203040506401Profitable,sustainable growth or boom and bust?Chapter 1
22、2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.0203040506501With a significant post-COVID-19 pipeline,government infrastructure funding in the U.S.and beyond,and ESG demands driving renewable energ
23、y and circular economy projects,its perhaps little surprise that many of the respondents to the 2023 Global Construction Survey are in a positive frame of mind.Two-thirds of this years respondents(66 percent)say they are optimistic about the direction of the construction market and 38 percent of pro
24、ject owners are“very optimistic”(see Exhibit 1)compared to just 18 percent in 2021.And the proportion of owners anticipating greater than 20 percent capital program growth has more than tripled from 10 percent in 2021 to 36 percent in 2023(see Exhibit 1),the highest figure in the 20-year history of
25、the survey.Four out of 10 E&C respondents expect revenue growth in the next 12 months to be greater than 10 percent,with just 18 percent predicting zero or negative growth(see Exhibit 2).E&C firms remain more cautious than project owners,but only a small proportion(7 percent)express pessimism about
26、the future state of the marketthe corresponding figure for 2021 was 29 percent(see Exhibit 1).With contractors in the middle of supply chain disruptions and with limited visibility into owners robust capital plans,such differences are to be expected.Profitable,sustainable growthor boom and bust?On t
27、he surface,the global engineering and construction(E&C)industry appears to be benefiting from positive momentum.Exhibit 1:Which of the following statements best describes the direction of the construction market?0%20%40%60%80%100%TotalEngineering/construction firmProject or infrastructureowner organ
28、izationVery optimisticSomewhat optimisticNeutralSomewhat pessimisticVery pessimistic28%38%25%6%16%37%36%6%5%38%38%16%6%1%3%N=2671211466%6%2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.020304050660
29、1Exhibit 2:What is the planned revenue growth for your organization over the next 12 months?0%10%20%30%Increase bymore than 20%Increase by11-20%Increase by6-10%Increase by1-5%No growthexpected(0%)Decrease by1-5%Decrease by6-10%Decrease by11-20%Decrease bymore than 20%14%27%27%15%13%1%2%2%0%Exhibit 3
30、:What impact will the governments funding,investment and/or stimulus of large-scale construction programs(e.g.,CHIPS and IRA in the U.S.,other programs in the jurisdictions where you operate)have on your organization in the next 12 months?0%20%40%60%80%100%TotalEngineering/construction firmProject o
31、r infrastructureowner organizationSignificant impactModerate impactNo impact35%43%22%34%49%18%35%39%26%N=267121146Theres also plenty of excitement about the prospect of government funding,investment and stimuli for large-scale infrastructure programs,such as Creating Helpful Incentives to Produce Se
32、miconductors(CHIPS)and Science Act,Inflation Reduction Act(IRA),and Infrastructure Investment and Jobs Act(IIJA)in the U.S.,Indias Production Linked Incentives(PLI)and Make in India campaigns,and similar programs in other countries.According to global research from Oxford Economics,civil engineering
33、 is set to be the fastest-growing sector in the construction market.1 More than one-third of survey participants(35 percent)feel this funding will have a significant impact and a further 43 percent expect a moderate impact(see Exhibit 3).Note:Applicable only for engineering and construction firm(N=1
34、21)1 Nicholas Fearnley,“Key Construction Themes 2023Infrastructure to drive growth,”Oxford Economics,December 14,2022 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.0203040506701Project performance
35、 in the spotlightDespite the confidence expressed by respondents,the industry continues to face a number of challenges,in the form of continued supply chain disruption,high energy and materials prices,and labor shortages that are further pushing up costs and holding up projects.The after-effects of
36、COVID-19 are still apparent,with 45 percent of respondents saying they have experienced a pandemic-related schedule delay or cost impact of more than 20 percent(see Exhibit 4).And the sector continues to struggle with poor project performance,with 37 percent of respondents reporting that theyve miss
37、ed budget and/or schedule performance targets over the past year due to lack of effective risk managementthis is up from 32 percent in the corresponding 2021 survey(see Exhibit 5).In fact,only half of owners projects are being completed on time.Exhibit 4:What percentage of your projects have experie
38、nced a schedule delay or cost impact attributable to COVID-19?0%20%40%60%80%100%TotalEngineering/construction firmProject or infrastructureowner organization0%15%610%3%13%12%2%17%13%3%9%12%N=26712114616%17%16%45%40%49%11%11%11%1120%More than 20%Dont know/not sureExhibit 5:Over the past 12 months,hav
39、e any of your capital projects significantly missed budget and/or schedule performance targets(20 percent or more)due to lack of effective risk management?0%20%40%60%80%100%TotalEngineering/construction firmProject or infrastructureowner organizationYesNoDont know/not sure37%44%19%40%44%16%35%44%21%
40、N=267121146 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.0203040506801Consequently,owners are seeing increased interest in the economics of large capital projects,with 87 percent stating that the
41、yre coming under greater scrutiny(see Exhibit 6).Indeed,28 percent of project owners say theyre facing“greatly increased”focus and scrutiny.Volatility has fueled market challenges,but so have the continued stagnant productivity and lack of innovation in E&C.Much of this is due to a highly fragmented
42、 structure where many players have neither the size nor the incentive to invest in new technology or methodologies,especially when contractors take on paper-thin margins that leave little room for error.Between 1997 and 2021,construction productivity actually fell by 7 percent,whereas in the manufac
43、turing sector it rose by 126 percent.Inadequate risk management has hardly helped,with insufficient linkage between project risk management and enterprise risk management that prevents owners and contractors from accurately aggregating all their risks to fully understand their corporate risk profile
44、.With a multitude of players,a dearth of data sharing and interoperability,and a siloed value chain,visibility across individual and multiple projects is often lacking.Project managers are often unable to identify and address poor performing projects,sites,or individuals.Exhibit 6:Which statement be
45、st reflects your perspective of the economics of large capital projects and the scrutiny surrounding their actual measured benefits and return on capital post project completion?0%20%40%60%80%100%TotalEngineering/construction firmProject or infrastructureowner organizationGreatly increasing focus an
46、d scrutinyIncreasing focus and scrutinyDecreasing focus and scrutiny24%63%19%64%28%61%N=2671211464%10%0%9%7%11%No changeHow is the industry responding to high volatility and poor performance?According to U.S.Bureau of Labor Statistics in March 2023,construction costs rose 17.3 percent year-on-year.2
47、 Add to this the war in Ukraine,the West potentially de-coupling its economy from China,resource constraints,and ongoing supply chain disruption,and its evident that E&C firms and project owners face continuous volatility.In response,83 percent of survey participants say their single biggest priorit
48、y is improving the estimating accuracy of materials and equipment,which accounts for a significant proportion of project costs(see Exhibit 7).Achieving better contractual protectionwhich is about transferring riskis another key imperative for both owners and contractors.However,such an approach can
49、damage owner/contractor relationships at a time when the two parties should work together more closely to enable owners to better manage their own risks.With both owners and contractors attempting to transfer risk,there is likely to be an impasse,although continued tightness in the market should fav
50、or contractors,who are in high demand.2 US Bureau of Labor Statistics,New Manufacturing and Industrial Building Construction PPI,March 2023 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.0203040506
51、901 We are seeing a dramatic shift by contractors away from fixed-price and guaranteed maximum-price contracts for major projects.Whether this is the result of learning from past mistakes,acknowledging that systems and tools are still not where they need to be,or simply driven by boards,bankers or r
52、isk officers,one thing is clear:we cannot expect business as usual.Contractors are no longer willing to assume primary responsibility for performance risk and,as contractors transition to more open-ended,cost-plus and time-and-materials contracts,owners will need to adjust how they control projects
53、and programs.”Colin Cagney,Director,Infrastructure,Capital Projects and Climate Advisory,KPMG in the USExhibit 7:How important are each of the following regarding your organizations response to supply chain disruption,cost escalation,resource constraints,deglobalization,COVID-19 and other disruptive
54、 events?0%20%40%60%80%100%Implementing or updating the models for remote working and job site travelExploring new and innovative approaches for project execution,including modular construction,design for manufacture and assembly(DFMA)and 3D printingImproving the estimating accuracy of materials and
55、equipmentIncreasing the use of commodity hedging strategies to offset increasing material pricesIncorporating contractual protections for supply chain disruptionsExtending the duration of planning activities to increase confidence around project scope,schedule,quantities,etc71%21%7%78%17%5%47%30%23%
56、83%14%3%46%31%22%72%15%13%45 More important3 Neutral12 Less importantTotal(N=257)2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.02030405061001Further potential options include longer planning perio
57、ds to better manage project scope,schedule and quantities,which,regrettably,is not always an option in commercial and mission-critical projects.When it comes to dealing with disruptive events,respondents are placing a greater focus on innovation(up to 74 percent from 60 percent)and workplace demogra
58、phics(up to 49 percent from 42 percent)than in the previous 2021 Global Construction Survey(see Exhibit 8).Effective risk management processes and resilience planning are also on the“to-do”list to help build resilience.Exhibit 8:Please rate the following attributes that influence your organizations
59、success or failure in dealing with disruptive events.0%20%40%60%80%100%Effective risk managementprocesses and resilience planningMaturity of business continuity programsIndustry focusRegions of operationsSize and scale(revenue)Focus on innovationAdoption of technologyWorkplace demographicsCompany le
60、adershipOwnership(public or private)72%19%8%71%20%9%57%26%16%69%26%5%74%22%4%78%18%4%49%35%15%94%4%1%54%29%17%84%14%2%45 More important3 Neutral12 Less importantTotal(N=257)2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clien
61、ts.All rights reserved.02030405061101 S.N.Subrahmanyan,CEO&MD,Larsen&Toubro Limited To address the pandemic and wider geopolitical disruptions,we enhanced our supply chain with alternate sourcing channels,multiple local vendors and strategic tie-ups.We devised deeper hedging strategies,adopted just-
62、in-time sourcing,and proactively engaged with our clients to address price variations/contractual indexation of raw material input costs.And,in response to sometimes unreliable supply chains,weve adopted indigenization,to gain greater independence.In one instance we manufactured complex launching eq
63、uipment for Indias high speed railways.In another,during the pandemic,we assembled and operated the countrys largest tunnel boring machine,creating a world record for the highest monthly tunnelling rate of 456 meters on the iconic Mumbai Coastal Road project.View from the industryBuilding supply cha
64、in resilience 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.02030405061201Finally,given the risks inherent in the market in general,and in large and mega-projects in particular,E&C companies and c
65、apital project owners are seeking ways to improve portfolio-wide risk management.Their number one aim is to achieve clearly defined and standardized risk management processes and controls.There is a greater emphasis upon accurate risk reporting(up to 36 percent from 25 percent)and establishing a ded
66、icated risk management department(up to 20 percent from 17 percent)compared to the previous 2021 survey(see Exhibit 9).Exhibit 9:Which of the following elements are you focusing on to achieve successful portfolio-wide risk management?23%21%34%52%37%27%21%15%21%19%39%54%26%9%35%26%15%22%20%36%53%32%9
67、%31%23%15%Formal risk management trainingBoard-level risk management committeeClearly defined risk cultureCommon risk taxonomy andrisk tolerancesIntegration between enterprise,portfolio and project risks functionsClearly defined and standardizedproject risk management processesand controlsAccurate r
68、isk reportingDedicated risk managementdepartmentQuantitative risk analysis toolsDont know/not sure9%5%4%0%Total(N=267)Engineering/construction firm(N=121)Project or infrastructure owner organization(N=146)2023 Copyright owned by one or more of the KPMG International entities.KPMG International entit
69、ies provide no services to clients.All rights reserved.02030405061301How can the E&C industry break the vicious cycle of poor performance,low productivity,and major project failures?From a risk management perspective,the ability to aggregate risk at an enterprise level can bring a clearer view of po
70、rtfolio risk,to avoid taking on projects that could break the company,as well as identifying emerging risks earlier to enable preventative action.Better transparency,allied with D&A,opens up understanding of risk interdependence,both within and across projects.There are a number of ways to improve p
71、roductivity,including the use of IoT sensors and data analytics to detect and assess problems like damagethis enables rapid response times that help minimize delays and cost overruns.Benchmarks for team performance can be easily created through shared data.Predictive maintenancewhich can increase th
72、e likelihood of heavy equipment staying operational and minimizes shutdowns.Access to suppliers data helps anticipate supply chain delays or shortages earlier,enabling procurement teams to seek alternative sources.Its also important to drive capital efficiency and effectiveness in a transparent and
73、integrated manner.The first step is a robust capital planning and portfolio management process that is well integrated into project governance and PMO activities through strong processes.Dashboards and KPIs show the status and performance of projects and portfolios,and also provide insights into upd
74、ated business cases linked to operations as well as customer and supply chain plans and models.(To learn more,read our recent paper,CapEx decisions in a downturn3.)In a fragmented sector,E&C companies have an opportunity to form construction ecosystems where data and insights flow between contractor
75、s,suppliers,and owners to introduce a common understanding of project delivery objectives thats aided by greater supply chain transparency.And finally,by paying careful attention to asset owners customer experience,its possible to create more society-friendly projects that reduce negative impact,whe
76、ther its reducing noise and pollution,or avoiding transport closures.Cracking the productivity and performance code3 Capex decisions in a downturn,April 2023,KPMG 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rig
77、hts reserved.02030405061401 John Murphy,CEO,J.Murphy&Sons Limited One of our main core values is to continually improve.Our other core values are to always deliver on time,on budget,and to a high level of quality.I feel our family ownership helps us to achieve these goals,enabling a longer-term view
78、 on how to realize sustainable growth five-to-ten years from now and to think differently about how we invest in the business.We apply innovation from the very start of a project during engineering and design,so we can deliver the project safely,efficiently,with timeliness better cost control,and ul
79、timately,with better quality.By investing in engineering capabilities and tools,we can drive efficient,practical solutions and find even more efficient ways to deliver projects year-on-year.In an increasingly digital age,data is critical for measuring our productivity,determining how we deploy our r
80、esources more efficiently,and reducing the carbon impact of our projects,which is especially relevant to our work in the transport and energy sectors.At the same time,we dont want to get swamped in data that overwhelms us and ceases to be useful.We generate a lot of data from our projects,so we have
81、 to think about how we can utilize the data,get it into the right hands at the right time to drive better decision-making,and make more accurate predictions.Sharing data and insights from project to project prevents us from reinventing the wheel and helps us to work smarter across the business and l
82、earn from our successes,as well as our failures.Our application of technology and intellectual property also benefits our clients through improved project outcomes.As our business grows,we want to be evolutionary rather than revolutionary.We are continuously investing to keep up with the pace of tec
83、hnological changeconstantly progressing.I believe thats how well be able to maintain growth and improve our performance in the future and continue to deliver high-quality projects for our clients.View from the industryDriving continuous improvement 2023 Copyright owned by one or more of the KPMG Int
84、ernational entities.KPMG International entities provide no services to clients.All rights reserved.02030405061501The rising influence of ESGChapter 2 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.
85、02030405061601Looking back to our Global Construction Survey from 15 years ago,the top drivers for sustainability among E&C companies(see Exhibit 10)was to position themselves as innovative or environmentally aware(cited by 56 percent of respondents),and to increase business opportunities and compet
86、itiveness (29 percent).However,in the 2023 survey,we see a strong commitment from the respondents.Nearly 54 percent fully envision the benefits of ESG and are aggressively pursuing maturity and improvement,whereas,nearly 37 percent see some benefit in ESG and are using targeted approach(Exhibit 10).
87、In addition,nearly 50 percent of E&C firms view implementing ESG into capital projects and programs as a competitive advantage(Exhibit 11).The rising influence of ESGOur recent paper,Construction in 20304,notes how the industry is regarded as high-carbon,high-waste,and high-polluting,with significan
88、t use of scarce resources like water and minerals,moderate usage of renewable energy,and limited progress with diversity in what remains a male-dominated sector.At the same time,E&C companies face growing regulatory pressure for sustainability in both its construction methods and the buildings and i
89、nfrastructure it produces.Failure to meet such demands could impact access toand push up the cost ofcapital.Exhibit 10:Changing trends of an organizations internal views on ESG4 Construction in 2030,February 2023,KPMGPositioned in the industry as innovative and/or environmentally aware company200856
90、%29%Opportunity to partner with additional types of clients202354%Fully envision the benefits of ESG and are aggressively pursuing maturity and improvement37%See some benefitin ESG and are usingtargeted approach6%Skeptical regarding ESGand consider it to be similar to previous sustainability trends.
91、(Wait and see approach)6%Not in alignment with ESG and only pursuing as required 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.02030405061701Project owners taking part in our global survey show su
92、bstantially greater maturity in their approach to ESG compared to E&C companies.In the U.S.in particular,they face increasingly stringent legislation,procurement requirements,and building code improvements,and any laggards will have to play a fast game of catch-up.When asked about the key benefits o
93、f embedding ESG into capital projects and programs,the top two responses were reputational improvement and competitive advantage.Half of E&C companies see opportunities to gain a competitive edge through ESG,suggesting that theyre beginning to grasp the value of more fully embracing ESG(see Exhibit
94、11).Respondents from E&C also consider safe,inclusive sites as a benefit,reflecting a desire to attract a wider range of workers.And 32 percent of owners recognize the need to integrate ESG in order to enhance their access to capital to fund projects(see Exhibit 11)an acknowledgment of the importanc
95、e of strong sustainability credentials to satisfy investors.Interestingly,project owners and E&C firms differ in their views over the most crucial ESG trends.The former feel that reducing GHG output and developing renewable facilities are most important,while contractors are more concerned with soci
96、al considerations,such as DEI,and meeting government requirements.Exhibit 11:What benefits could your organization realize by implementing ESG into your capital projects and programs?Operationalize ESG commitmentsFight green washingEnhance project successExplore viable sustainability optionsIncrease
97、d reliabilityImproved resiliencyMore inclusive and safe job sitesEnhanced ESG reportingReputational improvementOptimized resource consumptionEnhanced capital accessCompetitive advantageEnhanced productivity or occupantsEnhanced circular economyEnhanced ROI based on lifecycle approach4%2%6%32%31%32%3
98、2%35%29%28%27%29%28%31%26%21%17%25%23%22%23%33%35%32%30%26%32%12%11%14%24%23%25%24%18%28%39%45%34%42%50%35%48%50%47%Total(N=267)Engineering/construction firm(N=121)Project or infrastructure owner organization(N=146)0%10%20%30%40%50%As the three forces of Environmental,Social,and Governance converge,
99、E&C companies and project owners are set to accelerate their investment in ESG.”Geno Armstrong,Global Lead and Principal,Infrastructure,Capital Projects,and Climate Advisory 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clie
100、nts.All rights reserved.02030405061801This discrepancy is understandable as owners are currently being measured by Scope 1 and Scope 2 emissions of their facilities,whereas service providers gain market advantage by improving their DEI performance and adhering to requirements.As increasing Scope 3 r
101、egulations come into effect globally,owners are likely to ask service providers to disclose embodied as well as operational carbon,which in turn will direct the industrys focus to total lifetime GHG emissions.Decarbonization has become a central part of any construction project,and respondents liste
102、d the three most important practices as energy efficiency,reducing construction waste,and more efficient use of materials.The built environment generates around 40 percent of global greenhouse gas emissions(GHGs)and uses approximately 40 percent of global energy resources.It is,therefore,no surprise
103、 that ESG regulatory and stakeholder pressure is on the increase.The industry has also shifted its thinking since our 2008 Global Construction Surveywhere sustainability was thought of primarily as a profit vehicleto 2023,where a higher proportion of leaders see ESG as a core element of business str
104、ategy.The next step is to operationalize ESG principles into capital projects to increase efficiency and sustainability,reduce waste,avoid greenwashing,mitigate risks,and enhance long-term value for all stakeholders.”Firuzan Speroni,Ph.D.,Director,Infrastructure,Capital Projects and Climate Advisory
105、,KPMG in the USExhibit 12:Which of the following ESG trends are the most important for the success of your organization?GovernmentalrequirementsPressure forcontractors to align ESG goals withclientsInvestor and consumer pressures for green financingSocial considerations diversity,equity&inclusion (D
106、E&I)Development of renewable energy facilitiesReducing total green-house gas(GHG)outputEmbodied carbon measurementModular/off-site constructionGreen procurement initiativesSustainable construction codes and specificationsUptick in adoption of sustainable materials and technologyConstruction of ESG/G
107、reen-certi-fied buildings19%21%28%16%21%10%31%37%28%16%19%30%23%21%25%18%16%7%35%47%23%18%16%29%15%21%32%14%26%15%26%26%35%14%23%31%Total(N=267)Engineering/construction firm(N=121)Project or infrastructure owner organization(N=146)2023 Copyright owned by one or more of the KPMG International entitie
108、s.KPMG International entities provide no services to clients.All rights reserved.02030405061901Embodied carbon:The missing half of GHG emissions Up to half of all carbon emissions are emitted before the building is operational,as a result of embodied carbon:the amount of the GHG emitted during the m
109、anufacturing,transportation,installation,maintenance,and disposal of building materials.To date,facilities,real estate,and construction functions have ignored this half of their carbon emissions and its not just them;current standards,guidelines,codes,and measurements mostly focus on operational car
110、bon(from heating,air conditioning,and operating the facility)emissions.This presents a huge opportunity for many teams to further their commitments to decarbonization.For more on this vital topic,read our recent report,Embodied carbon:the missing half of GHG emissions.Firuzan Speroni,Ph.D.,Director,
111、Infrastructure,Capital Projects and Climate Advisory,KPMG in the US 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.02030405062001Jamie Martin,Vice President,Undergrounding,Pacific Gas and Electric
112、Company(PG&E)Over the past decade California has experienced an unprecedented increase in catastrophic wildfires,with over half of PG&Es 70,000 square mile service area designated as high-fire risk areas.By putting power lines underground,we can reduce the risk of wildfires by 99 percent along the u
113、ndergrounded circuit and improve reliability and resiliency at the same time.At PG&E,weve committed to underground 10,000 miles(16,000 km)of overhead electric distribution lines in high wildfire risk areas.Undergrounding is just one part of our integrated strategy to reduce ignition risk.Our compreh
114、ensive monitoring and data collection programs include wildfire cameras and inspections to give valuable insights into changing environmental hazards around our assets.Enhanced Powerline Safety Settings(EPSS)automatically turn off power within one-tenth of a second if the system detects a fault that
115、 could cause an ignitionlike a tree branch striking the power line.Downed Conductor Detection(DCD)technology can improve the ability to detect and isolate high impedance faults before an ignition.We are also managing the environment around the electric grid,such as trimming back vegetation.We know t
116、hat we cannot complete this important wildfire safety work alone and will need help from our customers,communities,and other stakeholders.Through our outreach approach,we share a comprehensive vision for wildfire risk reduction,including how we plan to utilize undergrounding,communicating early and
117、often with customers and stakeholders to keep them informed and answer questions and concerns.For our local,state,federal and tribal partners,we communicate through regular meetings,permitting discussions,and updates of planned work locations.Through collaboration and breakthrough thinking,we are wo
118、rking together to mitigate wildfire risk and make our hometowns safer and more reliable for generations to come.View from the industryUndergrounding to reduce wildfire risk and improve resilience in California 2023 Copyright owned by one or more of the KPMG International entities.KPMG International
119、entities provide no services to clients.All rights reserved.02030405062101Continuing efforts to improve worker safetyThe construction sector has made impressive advances in worker safety in the past decades,and the responses to our global survey suggest that companies continue to prioritize this vit
120、al area.For both project owners and E&C firms,the single most crucial factor is the tried-and-trusted behavioral,leadership and cultural change,to create a climate with zero-tolerance towards accidents.Respondentsespecially ownersare keen to increase safety monitoring and onsite health and wellness
121、testing of workers,to reduce the risk of incidents.Technology also plays more of a role to create safer working spaces,with respondents making greater use of data and analytics(D&A)to predict and prevent,as well as modular/offsite fabrication to reduce potentially dangerous onsite tasks.Our survey r
122、esults suggest that other innovations are at an earlier stage,with less frequent use,such as smart sensors and monitors,drones,remote-operated machines,and robotics.The low take-up of such potentially advantageous technology could be a wake-up call for progressive players to improve their safety rec
123、ords through digitalization and automation.Mental health is becoming destigmatized in the industry,with many companies taking tangible steps to support workers,including risk assessments that cover both physical and mental health,sharing resources around mental wellbeing,and offering practical help
124、like trained peer support.Post-COVID-19,the use of PPE and worker wellbeing has become high-priority,with some construction companies going the extra mile by providing employees with innovative new PPE items that not only help keep them safe,but also enable them to do their jobs more comfortablysuch
125、 as 3D printed masks and safety footwear that helps revitalize blood flow through the legs and feet and gives the wearer greater energy.6 As one would expect,safety is a crucial pillar of ESG-led performance and part of all ESG ratings assessments.Safety training and information exchange are increas
126、ingly benefiting from technology and software that engages staff and empowers workers to communicate risks.Smart devices like connected wristbands and helmets enable workers to be more proactive in their safety processes,share information about hazards and potential incidents in real-time,all while
127、fostering a positive safety culture.”Clare Lunn,Partner,ESG,Advisory,KPMG in the US6 Grant Prior,“Anti-fatigue safety footwear boosts energy,”Construction Enquirer,October 3,2019 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to
128、 clients.All rights reserved.02030405062201Adapting to the needs of a future,diverse workforceThe E&C industry is undergoing rapid change in its working practices,with a shift away from traditional,hard-hat,onsite positions towards technology-related capabilities that are often performed remotely.At
129、 the same time,both E&C firms and project owners are competing for scarce talent with companies from virtually every other sector.Respondents to the 2023 global survey rank DEI as the third most important factor determining future success.An increasing proportion(50 percent,compared to 42 percent in
130、 2021)cite the importance of diversified workplace demographics to help address disruptionthe diversity helps introduce new skills to tackle longstanding project cost and schedule challenges.2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no
131、 services to clients.All rights reserved.02030405062301And almost half(46 percent)acknowledge that implementing or updating models for remote working and job site travel can play a part in making construction projects more resilient and able to thrive during volatile times(see Exhibit 14).But it wil
132、l be tough to make these breakthroughs without the right people,which means doubling down on efforts to build a more diverse workforce.Exhibit 14:How important are each of the following regarding your organizations response to supply chain disruption,cost escalation,resource constraints,deglobalizat
133、ion,COVID-19 and other disruptive events?0%20%40%60%80%100%Implementing or updating the models for remote working and job site travelExploring new and innovative approaches for project execution,including modular construction,design for manufacture and assembly(DFMA)and 3D printingImproving the esti
134、mating accuracy of materials and equipmentIncreasing the use of commodity hedging strategies to offset increasing material pricesIncorporating contractual protections for supply chain disruptionsExtending the duration of planning activities to increase confidence around project scope,schedule,quanti
135、ties,etc71%21%7%78%17%5%47%30%23%83%14%3%46%31%22%72%15%13%45 More important3 Neutral12 Less importantTotal(N=257)2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.02030405062401Attracting the best gr
136、aduates and school leavers means offering fulfilling careers on the cutting edge of innovation,in purposeful,sustainable organizations,offering varied development paths,flexible working conditions and greater work-life balance.More and more employees are looking for companies that prioritize DEI,emp
137、loyee health and wellbeing,community building,and strong governancewhile minimizing their environmental impact.As we discuss in Construction in 20307,the sector has a golden opportunity to shed its male-dominated,“hard-hat,manual labor”image by becoming more technology-and sustainability-oriented.Th
138、is shift should help persuade graduates that this is an exciting industry to join.In a 2022 KPMG survey of U.S.workers,“Looking for more:Employee expectations are on the rise8,”an overwhelming 90 percent of respondents said work-life balance is an important factor when looking for a new employer.Alm
139、ost half45 percentdont feel they have adequate,diverse career path opportunities into lateral and upward roles.Another KPMG paper,“Navigating the tech hiring freeze9,”argues for a greater focus on workforce planning to determine an organizations talent needs and identify how to satisfy these demands
140、 by training and upskilling.And by building a compelling digital workplace experience,E&C companies can enthuse existing workers and attract future stars.Respondents to this years Global Construction Survey rank the development of improved and innovative training programs as the number one strategy
141、to attract next-generation talent into the sector.The metaverse offers particularly exciting opportunities to onboard,train,and interact.In“Want to win in the metaverse?Think internal first10,”KPMG surveyed companies from the technology,media and telecommunications industry and found the top uses of
142、 the metaverse were for internal activities such as employee training and onboarding,and employee collaboration.Given the continued digitalization of E&C,investment in the metaverse could be a catalyst for improving the employee experience.Creating an industry of choice for the best talent7”Construc
143、tion in 2030,”February 2023,KPMG,8“Looking for more:Employee expectations are on the rise,”August 2022,KPMG9 “Navigating the tech hiring freeze,”January 2023,KPMG10 “Want to win in the metaverse?Think internal first,”KPMG We need to think differently about the people that we attract into the industr
144、y,so that businesses become far more diverse and far more reflective of society.”John Murphy,CEO,J.Murphy&Sons Limited 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.02030405062501David Paterson,Ma
145、naging Director,Construction,Lendlease Sustainability underpins everything we do As a company were absolutely committed to climate action,with an intentionally bold goal of“absolute zero carbon”by 2040.To achieve this,we must eliminate all emissions from construction sites,without the use of carbon
146、offsets.And weve set ambitious targets:Phase out fossil fuel diesel and gas across our operations Use 100 percent renewable electricity before 2030 Collaborate with supply chain partners to set pathways to absolute zero by 2040Good data is essential to a credible plan,not just to report performance,
147、but also to forecast our emissions to stay on track.We must pull together to tackle climate change Were fortunate to be working with some amazing partners to accelerate our net zero ambitions.These include MECLAthe Materials&Embodied Carbon Leaders AllianceResponsible Steel,and the University of Que
148、ensland.No single party can fix the environmentit needs to be a team effort across the value chain.We need clients to request zero-and low-carbon options,for contractors to assess their supply chain,suppliers to innovate,while designers need to trust the options and be willing to test new things.Gov
149、ernments need to set supportive policies,and industry advocacy groups need to champion fossil fuel-free construction.A key role for governments Here in Australia,the government,state governments and the finance industry can support a domestic renewable diesel industry with investment into refineries
150、 or financial support for the use of renewable diesel.Mechanisms include tax relief,subsidies and rebates,green low interest loans and finance,grants,and a phase-out of financial support for fossil fuels.All state governments have carbon emission reduction targets,and governments can align their pro
151、curement policies with decarbonization targets for construction activities,to help reduce emissions on infrastructure projects.No time to lose Dont delaythere are solutions available today that can be deployed at scale.Understand your data,your emissions profile and the risks and opportunities to yo
152、ur business strategy.Learn about climate change,carbon emissions,scope boundaries and accounting and educate your employees,clients,and customers.The G20s Taskforce on Climate-related Financial Disclosure framework(TCFD)is a powerful way to explore the impact of climate change.Lastly,align to 1.5 de
153、grees,this is the change the world needs us to make.View from the industryAt the forefront of sustainable construction 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.02030405062601The great innovat
154、ion raceChapter 3 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.02030405062701Thats a burning question facing the sectors leaders as they ponder how to overcome continued poor project performance,
155、adopt,safe,sustainable construction methods,and improve the quality,efficiency and carbon footprint of buildings and infrastructure.Tech giants are both potential collaboratorsbringing new and exciting innovationsas well as competitors,as they use their data mastery to gain market share,and also att
156、ract the best talent.Our 2017 Global Construction Survey took a deep dive into technology and found an industry embracing building information modeling(BIM),analytics and project management information systems(PIMS),just starting to adopt drones,smart sensors and mobile,with a few bold innovators ex
157、ploring 3D printing,machine learning(ML),virtual reality(VR)and robotic process automation(RPA).Fast forward to this years survey and 81 percent of respondents from E&C firms say their organizations have adopted,or are starting to adopt,mobile platforms(up from 69 percent in 2017,see Exhibit 15),whi
158、le 43 percent are either using or starting to use RPA compared to just 10 percent in 2017.Meanwhile,take-up of VR(either using or starting to use)has doubled from 28 percent to 56 in the same time period.The great innovation raceWhat is the role of digital and other innovative technologies in the ne
159、w construction landscape?Have not adoptedJust started with a few projectsAdopting across all projects(N=121)Drones(remote monitoring,quantityverification,construction status)3D printingSmart sensors(trackingpeople and productivity,security,etc.)Virtual realityAugmentable realityArtificial intelligen
160、ceMobile platformsUse of advanced data analyticsUse of basic data analyticsIntegrated project managementinformation systems(PMIS)Building information modelingRadio frequency identificationRobotics process automation/digital laborCognitive machine learningMachine engineering and designModular/off-sit
161、e manufacturingDigital twins0%20%40%60%80%100%17%37%46%11%45%45%31%47%21%19%47%34%16%45%39%57%33%10%57%36%7%68%28%4%60%32%8%26%47%26%37%49%14%44%41%15%46%41%12%60%36%4%44%44%12%20%60%21%51%37%12%Exhibit 15:Please rate your level of adoption of each of the following technologies E&C firms 2023 Copyri
162、ght owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.02030405062801 Accelerating tech adoptionInnovation is a familiar buzzword in board rooms,corporate offices and construction sites,and some companies have made i
163、mpressive progress.Weve seen robotic dogs that“sniff out”unsafe incidents and practices onsite,capture ongoing construction in three dimensions for close-to-real-time work measurement,and check design alignment vis-vis a 3D model.Then theres the project owner organization that ordered out all major
164、packages in record time,by collectively bargaining with its service providers,shaving precious months off the implementation schedule.In another example,a prime contractor uses 5D BIM layered with its custom workflows and internally developed Theory Of Constraints(TOC)-based lean construction method
165、ology,for a fully integrated concept-to-design-to-delivery approach.Digital technologies serve as one of the largest levers for owners and E&C firms to implement innovative ideas and solve project implementation problems.The key is to use a combination of already available and tested technologies.In
166、 the rush for instant results that yield a positive,short-term ROI,many potential digital technology investments are overlooked.A 35 year horizon is realistic when assessing the investment case.And dont underestimate the importance of cultural barriers in both owner and contractor organizations;a sh
167、ift in culture is often necessary to drive innovation at business unit,functional and individual levels,creating a virtuous cycle.As our survey responses demonstrate,established industry players are deploying PMIS,BIM and advanced data analytics,and are making inroads into the use of digital twins,A
168、I,VR/AR,3D printing,RPA.The successful adopters are championing innovation from the very top and investing in educating their teams.In addition to encouraging digital technology use for project implementation,management can also apply these technologies to conduct management reviews and governance,s
169、ending a further signal that the organisation is shunning conventional,manual methods and striving for digital leadership.”Suneel Vora,(PMP),Partner,Business Consulting Capital Projects and Industry 4.0,KPMG in India 2023 Copyright owned by one or more of the KPMG International entities.KPMG Interna
170、tional entities provide no services to clients.All rights reserved.02030405062901However,a far smaller proportion of respondents companies are applying these and other technologies across all projectsjust 6 percent for RPA,5 percent for 3D printing,4 percent for ML and 8 percent for AR.With a lack o
171、f consistent standards across the industry,the full benefits of such innovations are some way off.Another technology growing in popularity is AI.Since the 2018 Global Construction Survey,use of AIin the form of digital twins,smarter construction equipment,data and document management,and enhanced sa
172、fety and communicationhas increased significantly.In 2018,just 23 percent of respondents said they were either adopting or just started to adopt AI.That figure rose to 29 percent in 2021,and climbed to 37 percent in 2023(see Exhibit 16).As a measure of how far there is to go,a mere 4 percent are app
173、lying AI across every project,although 33 percent have started to use AI on a few projects.Have not adoptedJust started with a few projectsAdopting across all projectsTotal(N=267)Drones(remote monitoring,quantityverification,construction status)3D printingSmart sensors(trackingpeople and productivit
174、y,security,etc.)Virtual realityAugmentable realityArtificial intelligenceMobile platformsUse of advanced data analyticsUse of basic data analyticsIntegrated project managementinformation systems(PMIS)Building information modelingRadio frequency identificationRobotics process automation/digital labor
175、Cognitive machine learningMachine engineering and designModular/off-site manufacturingDigital twins0%20%40%60%80%100%21%39%40%12%47%42%36%47%17%27%44%29%25%43%32%58%31%10%64%30%6%73%22%4%69%27%5%28%48%25%39%44%17%53%34%13%60%32%8%63%33%4%44%40%16%24%54%22%59%32%9%Exhibit 16:Please rate your level of
176、 adoption of each of the following technologies Total 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.02030405063001Making the right technology investment betsWhich technologies have the potential t
177、o deliver the greatest overall return on investment(ROI)in capital projects?The picture has changed little since the same question was asked in our 2017 survey,with integrated project management information systems(PMIS),BIM and advanced data analytics as the top three responses.These proven innovat
178、ions are clearly making their mark,but the survey findings suggest there is a lot of untapped potential from newer,emerging tech such as digital twins,AI,VR/AR,3D printing,RPA andas we will discuss shortly,modular manufacturing.The industrys mixed record of going over budget and over schedule is som
179、ething that everyone involved in construction has been striving to overcome for decades.So it was fascinating to hear how the various new technologies were contributing to cost and schedule performance improvement,or avoiding overruns.The technologies that are gaining most traction are digital twins
180、 and modular/offsite manufacturing,while,AI and RPA appear to be in early stages of adoption.These responses suggest that,while some forward-looking companies are gaining tangible benefits on project performance metrics,others are failing to make the best use of technology.They could benefit from te
181、am members with business process,technology and change management experience,and individuals who can drive technology implementations to ensure they deliver on their approved business cases.This often requires a structured project management office(PMO)dedicated to technology implementation and asso
182、ciated business processes.Artificial intelligence3D printingAugmented realityBuilding information modeling(BIM)Cognitive machine learningDigital twinsDont know/not sureDronesIntegrated PMISMachine engineering and designMobile platformsModular/off-site manufacturingRadio frequency identificationRobot
183、ics process automation/digital laborSmart sensorsUse of advanced data analyticsUse of basic data analyticsVirtual realityOther17%6%7%53%4%0%0%61%17%12%24%0%1%14%21%38%17%7%0%16%3%4%42%6%0%6%45%23%13%21%0%1%15%23%31%14%4%1%9%2%2%49%4%11%3%48%15%10%11%31%1%9%12%36%18%5%0%2018(N=166)2021(N=186)2023(N=2
184、67)Exhibit 17:Technologies with potential to deliver the greatest overall ROI 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.02030405063101The stage is set for modularIn their new book“How Big thin
185、gs Get Done11,”Bent Flyvbjergchair of major programme management at Oxford Universitys Sad Business Schooland co-author Dan Gardner present a passionate argument for the benefits of modular manufacturing,taking construction from the site to the factory floor,making use of standardized designs to cut
186、 costs,improve quality and safety,and speed up construction.Accordingly,2023 is the first year the Global Construction Survey has tracked the use of modular/off-site manufacturing,with one-quarter of E&C respondents reporting that they leverage such an approach across all projects,and a further 61 p
187、ercent starting to adopt on a few projects.More than eight out of 10(84 percent)of respondentsboth owners and E&C companiessay that prefabrication is an important solution for capital projects,suggesting that all parts of the industry should work together to advance its use.Looking more closely at t
188、he use of modular manufacturing,a majority(69 percent)apply it for less than one-fifth of projects(see Exhibit 18).Interestingly,only 28 percent expect to adopt this technology across more than half of their projects within five years.Hopes are high for modularalmost one-third(31 percent)feel that i
189、t has potential to deliver the greatest ROI.Its now time for this approach to go mainstream,to achieve the kind of industry disruption that other sectors have experienced,like automotive with electric vehicles(EVs).Technology and worker safetyHaving worked tirelessly to create a safety-first culture
190、,E&C companies are turning to more technical solutions to ensure that workers dont come to harm.The most widely used technologies in this respect are data and analytics to predict and prevent incidents,and modular manufacturing,to reduce the volume of onsite work.Other advancements that improve safe
191、ty include robotics(cited by 8 percent as driving better safety),remote operated machines(15 percent),drones for monitoring(18 percent)and smart sensors for notifying high-risk activity or health concerns(24 percent).These relatively modest figures indicate significant room for improvement in use of
192、 digital technologies to meet critical safety KPIs.11 Bent Flyvbjerg,Dan Gardner,“How Big Things Get Done,”Currency,February 7,2023 02030405063201 2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.It
193、may have been around for decades,but modular constructions moment has arrived as a way to address challenges like supply chain disruption,labor shortages,and rising interest rates,as well as reducing carbon footprint,improving environmental impact,and enhancing worker safety.To fulfill modulars pote
194、ntial and drive the industry forward,we need to address several key challenges.One of the factors limiting modulars growth is plant capacity.Although new modular manufacturing facilities are emerging,many of the more ambitious larger-scale projects cannot be fulfilled directly from regional supplier
195、s.This means they either manufacture(with all the added time and complexity)or revert to hybrid construction models.We expect a wave of financing to expand manufacturing footprint and increase production throughput,along with creative collaborations to use excess capacity between projects.Financing
196、is a key bottleneck limiting the number and scale of modular projects.Unlike traditional construction,where developers can get financing for around 80 percent of project costs,modular financing typically provides just 4050 percent,with a higher proportion paid out up front.To deliver on its full pot
197、ential,modular construction requires strong vertical integration across the project delivery lifecycle,to drive standardization,enjoy economies of scale and bulk purchasing,and reduce(and,ideally eliminate)inefficiencies and errors that occur at key interface points between design,procurement,constr
198、uction,and commissioning.Delivery support.Unlike traditional manufacturing,where the product is(largely)complete when it ships from the factory,modular buildings need to be treated with great care during delivery and commissioning.Therefore,manufacturers need onsite representatives,which add cost an
199、d limit the potential customer reachunless delivery support is provided by a trusted and knowledgeable dealer or a general contractor(GC)construction partner.Making modular manufacturing workExhibit 18:What percentage of your projects currently leverage modular/off-site manufacturing?7%35%27%17%14%1
200、00%0%1-10%11-20%21-50%Over 50%TotalExhibit 19:What percentage of your projects currently leverage modular/off-site manufacturing in five years?0%20%40%60%80%100%TotalEngineering/construction firmProject or infrastructureowner organization0%1-10%11-20%21-50%Over 50%2%16%22%6%28%N=26712114632%3%15%21%
201、25%36%2%17%23%30%28%2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.02030405063301Benefits of modular constructionReduced schedule timeImproved safety productLower labor costsControlled costsGreater
202、 consistency of deliveryModular can be used on all types of projects but is particularly well suited to:Urban midrise multifamilyLow income multifamilyUrban medical centersCommercial officesLabsData centers02030405063401 2023 Copyright owned by one or more of the KPMG International entities.KPMG Int
203、ernational entities provide no services to clients.All rights reserved.S.N.Subrahmanyan,CEO&MD,Larsen&Toubro Limited Our clients are becoming ever more demanding,which is why we employ multiple digital construction technologies and continue to focus on improved productivity.Greater pre-fabrication,p
204、re-casting,and modular manufacturing improves quality,reduces the risk of error,and speeds up construction,as does mechanization and automation.By combining prefabricated,pre-finished volumetric construction(PPVC),structural steel construction,modular construction and 3D printing,weve managed to red
205、uce typical project durations by an incredible 50 percent.In one example,we successfully built 96 residential flats in just 96 days,and a seven-story building in less than 45 days.These kinds of timescales would have been unthinkable a few years ago.And thanks to our digital tools and systems,we now
206、 get the benefit of real-time updates,predictive forecasting and better collaboration between different teamstogether they enable faster decision-making.Digital twins accelerate development of designs and allow us to customize designs more closely to client needs.Its not just about construction;digi
207、talization also enhances operations of our clients assets to reduce operating costs and maintenance,by making them smarter.And 5G is set to bring even higher speed and lower latency.Underpinning much of this is our continued investment in our IT and technology services businesses,which we plan to gr
208、ow multi fold.We are building our capabilities in high-growth areas such as data centers,cloud,AI,cybersecurity,and blockchain,among others.We have already launched two new digital e-commerce platforms:a B2B marketplace for industrial goods(called L&T SuFin),and an online learning platform for upski
209、lling and vocational training(L&T Edutech).With these kinds of advances,were confident that our business will be in a strong position to compete in an increasingly digital world.View from the industryEmbracing modularization and digital technologies 2023 Copyright owned by one or more of the KPMG In
210、ternational entities.KPMG International entities provide no services to clients.All rights reserved.02030405063501Key takeawaysAddress productivity as a matter of urgency By taking an outside-in approach,the E&C industry can learn from the best practices from other sectorsprimarily manufacturingto g
211、ain efficiencies from scale,standardization/modularity,and value chain ecosystems.In doing so,project owners and E&C companies can finally make the kind of productivity gains that have eluded them for so long.Master enterprise risk management The capability to assess organization-wide risks,across m
212、ultiple projects,large and small,is vital in bidding,pricing,and resourcing.A modern E&C company,with a good understanding of risk interdependence,should have the confidence to say“no”to unprofitable projects and avoid a race to the bottom,as well as spotting potentially damaging risks earlier and t
213、aking decisive action to prevent project failure.Truly embed ESG Future leaders spanning the construction sector will likely lead purposeful organizations that recognize the benefits of sustainable construction,infrastructure,and buildings,along with sustainable supply chains,diverse workplaces,and
214、strong community ties.A changing regulatory environment,compounded by heightened expectations from investors,employees,and customers,has made ESG a business imperative.Failure to prioritize ESG could result in a negative sustainability profile,reducing access to capital and top talent,further limiti
215、ng companies ability to keep up with ESG leaders.Lip service to ESG is no longer enough.Become data masters Those companies that can capture data,analyze it,and produce practical insights will likely enjoy lower costs,better project performance,greater efficiency,and safer workplaces.They are also l
216、ikely to attract a new breed of digital worker who sees exciting opportunities to create the smart,sustainable buildings and infrastructure of the future.2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reser
217、ved.02030405063601In this survey,you will find the perspectives of 267 people from engineering and construction companies and project owners from a variety of industries(121 represented E&C companies,146 represented project owners).Many of the responses were gathered during face-to-face interviews i
218、n 2022 and 2023 with senior leaders,with a large number of them serving as chief executive officers.The vast majority of respondents are from organizations carrying out significant capital investment projects.About the surveyUS$20 billionor moreUS$20 billionUS$5 billionUS$1 billion11%15%32%42%Quoted
219、(public company)Subsidiary of aquoted companyPrivate companyGovernmentcompanyOther27%13%50%10%7%Healthcare/Life SciencesTechnologyRetail/Consumer ProductsFinancial Services/InsuranceResources/ChemicalsGovernment/EducationIndustrial manufacturingMedia/TelecomPower/UtilitiesReal Estate/HospitalityOthe
220、r11%11%5%3%12%21%21%4%28%20%37%HQ regionOrganization category45%Engineering/construction55%Project/infrastructure owner14%ASPAC60%EMEA26%AmericasRegions of operation(multiple selections allowed)Industry sectorApproximate entity revenue from operations in the last 12 monthsEntity type(multiple select
221、ions allowed)0%15%30%45%60%IndiaNorthAmericaEurope(excludingUK)MiddleEastCentral/SouthAmericaRestof AsiaAfricaAustraliaUKChinaOther51%29%26%22%22%19%17%16%16%11%5%2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rig
222、hts reserved.02030405063701The KPMG Global Engineering&Construction practiceWhen engineering and construction leaders turn to KPMG member firms for advice,they do so because our professionals understand the industry at a local,national,and global level.For decades,we have provided services tailored
223、specifically to meet the needs of the industry.To do this,we have created a diverse practice that includes strategists,financiers,certified public accountants,professional engineers,architects,project managers,owner representatives,contract and procurement specialists,tax professionals,business valu
224、ation specialists,cost estimators,certified fraud examiners and technology specialists.KPMGs Engineering&Construction professionals provide strategic insights and relevant guidance wherever our clients operate.Services are delivered through the global network of KPMG member firms by over 2,000 profe
225、ssionals in more than 40 countries worldwide.KPMG professionals help clients identify and mitigate project risks throughout the project life cycle.Our capabilities encompasses,“having the right strategy,”“doing the right project,”and“doing the project right.”Engineering&Construction practice service
226、s include business model evolution,mergers and acquisitions,ESG,site selection,technology selection and implementation,construction program evaluations,project risk and controls assessments,contract compliance analyses,as well as project support on complex and troubled projects.We provide industry k
227、nowledge,multidisciplinary teams,and substantive experience in managing both the financial and technical aspects of major capital projects and programs.By combining valuable global insight with hands-on local experience,we can help you address challenges at any stage of the life cycle of infrastruct
228、ure assets or programs.Get more information and access a selection of other relevant KPMG reports and insights,please visit:home.kpmg/infrastructureAccess all past editions of the Global Construction Survey 2023 Copyright owned by one or more of the KPMG International entities.KPMG International ent
229、ities provide no services to clients.All rights reserved.02030405063801We would like to thank our contributors:Colin J.Cagney,Firuzan Speroni and Gaurav Mathur.We would also like to extend a special thanks to Clare E.Lunn and Brian Relle.AuthorsGeno Armstrong Global Lead and Principal,Infrastructure
230、,Capital Projects,and Climate Advisory KPMG in the US E:Clay GilgeNational Lead and Principal,Infrastructure,Capital Projects,and Climate Advisory KPMG in the US E:Kevin MaxPrincipal,Infrastructure,Capital Projects,and Climate Advisory KPMG in the US E:Suneel VoraPartner,Business Consulting Capital
231、Projects and Industry 4.0 KPMG in India E:Clay has more than 25 years of practical experience and research,giving him a deep understanding of how organizations can improve the performance of their construction portfolios,programs,and projects by empowering their teams,enabling technology and rationa
232、lizing governance and oversight.He has been at the forefront in advancing industry-leading methods and tools to objectively benchmark project management controls and overall project readiness.Geno has invested more than 30 years studying major projects and organizations,cataloging what executives do
233、 well,and applying“reverse engineering”to failed or struggling initiatives.His experience encompasses hundreds of the largest,most complex projects and organizations globally,across virtually every industry.Suneel has more than 20 years of experience conceptualizing,planning,and implementing capital
234、 portfolios,programs,and projects for the private,institutional and government sector clients in India and overseas.He serves as a leader in supporting clients with technology enabled solutions.Kevin is a professional engineer with extensive civil engineering and construction management experience.K
235、evin advises clients on a wide variety of large public and private sector projects including infrastructure development and industrial manufacturing facilities.2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights
236、 reserved.02030405063901Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities.The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity.
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238、gh examination of the particular situation.2023 Copyright owned by one or more of the KPMG International entities.KPMG International entities provide no services to clients.All rights reserved.KPMG refers to the global organization or to one or more of the member firms of KPMG International Limited(
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240、license by the independent member firms of the KPMG global organization.Throughout this document,“we”,“KPMG”,“us”and“our”refers to the global organization or to one or more of the member firms of KPMG International Limited(“KPMG International”),each of which is a separate legal entity.The views and opinions expressed herein are those of the interviewees and do not necessarily represent the views and opinions of KPMG.Designed by DAS Design.DASD-2023-12491Publication name:Familiar challengesnew solutionsPublication date:June 202302030405064000640