- There is a growing need to transform how infrastructure is planned, delivered and managed as urbanization, digitalization and climate change increasingly impact the world.
- In this environment, developing more sustainable infrastructure will require a change in how construction projects are planned, delivered and managed.
- To build better, industry needs to embrace digitalization, establish new working practices and increase collaboration with the public sector.
Airports, highways, and hospitals. Subways and railway systems. Water utilities, power and telecommunications grids. The delivery, operation, and management of infrastructure is the lifeblood of any economy. It is critical to keeping goods, services and energy flowing, to boosting productivity, and to safeguarding equitable economic development and jobs. But the challenges currently facing these multi-billion-dollar systems are enormous.
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The entire lifecycle – from planning and design, to construction, management and maintenance – can involve hundreds of vendors and other stakeholders, and span decades. Add to that, urbanization, digitalization, rising social expectations, and the quest for green growth, and it’s clear that we need to transform both the infrastructure we have today, and the way new infrastructure is planned, delivered and managed. We need to become cleaner, more energy efficient and more resilient to the rapidly intensifying effects of climate change.
From “infrastructure as usual” to “infrastructure 4.0”
Clearly, it’s no longer enough to rely solely on traditional, business-as-usual approaches. Manufacturing has gone through multiple phases of development to reach the industry 4.0 stage and the world of energy has advanced to electricity 4.0. Infrastructure also needs to evolve into a 4.0 phase in which modern technologies and management approaches are leveraged to the fullest.
Infrastructure 4.0 is about integrating digital technologies with physical assets. It’s about generating, harvesting, integrating, and analyzing data. It allows us to see and understand things that were previously too big or interconnected to make sense of. It enables information to be shared more easily and to be made more meaningful to a wider range of people – from infrastructure professionals, to citizens, government, and investors. And it’s about enabling more collaborative ways of working.
We must take the following three actions to make infrastructure 4.0 a reality:
1) Embracing digital innovation
Infrastructure needs to embrace 21st century digital innovation. That goes for both projects being built today and for existing infrastructure that’s being expanded, retrofitted or repurposed to meet new needs or circumstances.
Other industries are already avidly harnessing new technologies and the advantages they bring. Construction, however, has the second-lowest rate of digital adoption, ahead only of agriculture, according to the McKinsey Global Institute.
There are now plenty of digital tools that allow project participants to better generate, harvest, integrate and analyze data – to better see, plan for, manage and understand the enormous complexities of mega projects.
We’re talking about unlocking efficiencies in infrastructure asset delivery through the effective combination of people and technology: tablets that allow engineers to better access, update and share design plans remotely, for example. Or electrical simulation software that facilitates installation of renewable energy sites. Or cloud-based construction management tools that enable more efficient multi-stakeholder collaboration, while also giving developers, builders, and land planners actionable insights to reduce their carbon footprint.
2) Taking an outcome-focused, integrated approach
We need to address the siloed thinking that is still too common in the industry. When it comes to building or modernizing infrastructure assets, the many parties involved often struggle to look beyond the narrow remit of what they’re responsible for. This can lead to inefficiencies, project delays and budget over-runs.
It would be far better for infrastructure organizations to consider the required outcomes of the whole system – and work with partners who do so too. Fostering a more holistic, systemic approach to sustainable infrastructure, and putting digitalization to work, requires a change in industry working practices and relationships that brings key stakeholders together in a unified pursuit of a clearly-defined outcome. We call this an enterprise approach.
Take Anglian Water’s £400 million Strategic Pipeline Alliance (SPA) as an example. This is one of the largest infrastructure projects in the UK helping to combat the impact of climate change and securing water supplies for future generations. The enterprise approach is aimed at securing key overarching outcomes such as improving water supply resilience and customer experience, reducing carbon emissions and having a positive impact on local communities and economies. A supply chain ecosystem approach has been used, in which the influence a supplier can have on these outcomes (not the package cost) defines the relationship between SPA and the supplier.
3) Harnessing public-private collaboration
Finally, we must improve public-private partnerships (PPP), which have a mixed success record if not properly structured or implemented. Private-sector businesses, from start-ups to major global corporations, are playing an increasingly active role in getting mega infra projects built. They can bring in extra financing, digital innovation, and other capabilities to complement areas in which governments and multilateral institutions may be lacking.
What is the World Economic Forum doing on infrastructure?
Infrastructure is one of the least technologically transformed sectors in the entire economy, with crucial components like construction ranking second to last in digitization according to industry rankings. Technologically-enabled infrastructure has the potential to change the way we plan, design, finance, build and operate our infrastructure systems and, more importantly, help achieve broader goals around sustainability, social cohesion and inclusive economic growth.
The World Economic Forum’s Infrastructure 4.0 initiative, supported by the Global Infrastructure Hub, is working to improve the adoption of emerging infrastructure technologies across asset and system lifecycles.
By creating recommendations for decision-makers and providing best-practice case study examples to the Global Infrastructure Hub’s G20 Infratech Use Case library, this initiative aims to refocus the infrastructure development conversation around how infrastructure as a tool to provide better outcomes in people’s lives and technology’s role in enabling this people-first future.
In Germany, for example, the Autobahn authority is working with a consortium of private companies to construct the Autobahn A3 project – the largest PPP infrastructure project ever commissioned in the country. It comprises the planning and expansion of a six-lane 76-kilometre federal motorway. The main advantage of the PPP model is the aim for rapid implementation in around just 5 years. Collaboration is enhanced by digitalizing the entire construction cycle using 5D Building Information Modelling (BIM) to connect all stakeholders for more transparency and more efficient decision making.
From “build as usual” to “build better”
The world is changing – fast. Recent years have seen an ongoing build-up of urbanization, sudden sharp shocks like the COVID-19 pandemic and the increasingly severe disruptions caused by the climate crisis. All of this means that, when we build, we need to build better and we need to do it quickly, efficiently, and sustainably.