Construction Industry Masterclass Insights

Nuno Gonçalves: Hey, Siobhan.

Siobhan Savage: Hello! Thank you for letting me crash this one.

Nuno Gonçalves: Oh, you're kidding. I said when I saw the industry, I said, we're gonna Mike, I love you, but we're gonna need to bring Siobhan a little bit because, anyway, but he was happy because he knows that you rock on this industry, so I think it will be good.

We'll just give a couple of 30 seconds, a couple of minutes or minutes, for everybody to join, but I'm absolutely excited. It's good to be in the stage with you again, as always.

Siobhan Savage: ,

Nuno Gonçalves: And this one, to be specific, you actually picked yourself out of the conversation.

Siobhan Savage: I actually did.

Nuno Gonçalves: But you did, you did.

No, but it's good to have you back. And it's, I think we're going to have a blast. It's always this. And with Mike, in all honesty, he's absolutely brilliant also from a data perspective and all the inside. So it's always. Really fun as well. So, but, I'm excited about this one.

I think there's, if there's a world where, right now or an industry that right now is being impacted also, for everything that is, from an economic perspective, everything that is happening around the world is this one. And it's also more visible and very visible because of the size and the importance of all of that.

So looking forward to pick your brain a little bit as we go, and bring the insights of how can we ultimately continue to, tackle this evolution of this industry as well. So, everybody, I think we have almost everybody also in the webinar. Why don't we start? Are you good to start?

Are we okay to start?

Siobhan Savage: Yeah, I think we're good to go. I think just a little bit of context as well. My background and expertise pre to Reejig was construction. So, the reason I wanted to be part of this one, yeah, massive multi billion dollar constructions all over the world. So this one is very, I'm very passionate about this one, but also see this as a great opportunity, for the industry to reinvent themselves.

So, very excited and thank you Nuno for letting me. Jump in.

Nuno Gonçalves: No, we're gonna probe on that one as well. Siobhan so but Welcoming also everybody to the skills master class, there's a lot of people that continue to come because ultimately there's the insights that we provide to different industries that can help Many organizations to understand work and how to unbundle work in one industry at a time. That's what we do and what we're doing today As, we've been focusing on this construction industry It's a sector that is evolving very rapidly, with advancements in automation in robotics as well in industry. It was a sector that was very disruptive before, with everything that was industrial transformation.

and even more right now. So you'll see some of the, some of that, Concerns and directions coming from senior leaders and CEOs on the industry. And how this is shaping their ultimately workforce transformation as well. Siobhan, you have, you've been in the industry for many years and ultimately.

There's no one else better placed to see the workforce evolutions of an industry that continues to have to reinvent itself with all the pressures that we see from an economic perspective. So it will be an absolute pleasure to have you here. So my name is Nuno Goncalves. I'm heading up workforce strategy at Reejig.

Siobhan, everybody knows Siobhan. Siobhan is our CEO and co founder. She is being a leader of this all movement of the impact on the workforce and because of her previous background, a perfect match to everything that we're doing today. So to give you a bit of frame, we will start with giving you a little bit of an industry outlook, and some insights of where the industry is today and where we think and we're seeing the industry going.

We'll talk a little bit about what we do and from a work ontology. And how do we bring the visibility to what work happens in the industry and how this work can eventually evolve. That's the work ontology that you probably already know. And then how is this being impacted by AI, by robotics and what needs to be changed from a work perspective.

And what is the impact on the skills that you will need moving forward if you are in the construction industry, how we're going to invest in re skilling and upskilling your workforce moving forward again. And what I love about rigid is that not only we give you some of those highlights and insights from a data perspective, but also we start giving you perspective of what you need to do.

What is the action that you need to take so that you actually go to a future that we are all trying to build as well. So that's the plan. Industry outlook, work for work ontology, ai, reskilling, and action, so that at the end of these 55 minutes, you get out of here with somehow of, let's go an action plan moving forwards.

It's a $15.2 trillion industry. It's we don't, we don't even know what we're, the amount of money that we're talking about. So it's growing exponentially. We're talking about. Accounting for 13 percent of global GDP. It's a significant and very big, industry. Maybe one of the biggest industries that we've, that we have on our ontology is not,

Siobhan Savage: , sure.

That in retail. Retail is also in hospitality. Retail hospitality. Yeah.

Nuno Gonçalves: So in the U. S. It's interesting because from right now, from a terrorist perspective, I'm assuming that always will we be seeing a reduction of work? Because again, work will be more expensive. Or do you think it will actually grow even more meaning, with all the pressures that we're having from a terrorist perspective?

yeah. Will we spend more meaning 15. 2 might be just the baseline? Or do you think we'll have to prioritize all the construction projects and actually be able to do less because ultimately it's more expensive? What's your take there?

Siobhan Savage: I think from a industry perspective, it's not a needing more workers, it's we need smarter ways to build because you're going to have these issues around costs.

So whether it was COVID, whether it was tariffs, whether it's these cycles of ups and downs, I think there's going to have to be a smarter way. For us to do the building and the construction in a way that is resilient to all things because the tariffs is only just one thing right it's just and no one knows what that actually what the outcome of that will be but there'll be another thing and this just continues and the margins are so low in construction that every dollar and from my experience even watching how the contractor bid for work is that the margins are getting lower and lower so there's this cost pressure.

That you will see on a major project that you probably won't see in other environments, because every penny really does matter. So I think, yes, there's tariffs and yes, there is big cost pressures, but I think overall the sector itself, there's going to have to be a different way to think about being a margin machine.

and that's where it's going to become a different conversation. And this is why, I think this one's a really important one.

Nuno Gonçalves: So I guess it's then it's at the perfect place also for reject beating. If you have all the pressures that are from a cost perspective, so how do you re engineer the way that you do work?

So that you do, you supercharge your workers, whether it's from robotics and automation and so on, and then do more faster, better with less. So that you can have better margins, and be able to actually deliver on what you need to deliver. So I think it's a great point as well.

What, when we're starting to see some of the leaders in the industry, I think it's some of the same problems that we have or some of the same statements and some of the same concerns that we have in all the other industries as well. So on one side, we know that this is probably one of the industries that are more.

focused on robotics and automation as well. But on the other side, we talked about the price that you're talking about. The price pressure of, that we had that they have everywhere, whether it's government construction or private construction as well. A focus on skills, the need of skills in some specific craft, that are in the construction.

And somehow the labor shortages, especially in some of the more remote places that we're building and that we're constructing as well. So it doesn't, I think it doesn't change much from many other industries, but it actually gets amplified, I think, in some cases in the construction because there's so much pressure, and there's so much expertise and skills that ultimately it's hard to find them where you need it, the amount of time that you need it, and with the skills that you need as well.

They also talk about these supply chain disruptions, which is very interesting. In a previous industry conversation that we're having, the automotive conversation, I then realized something that is very interesting is that once you start manufacturing, Some pieces of what you manufacture will have to go through different countries.

So if comes from Asia to Canada and Canada to us, then there's a disruption and a cost increase every time that it lands on one country as well. So, very disruptive, very complex and with pressures all over, but still the. The focus is cost or the concerns are cost our skills are labor shortage and so on so forth.

do you see big differences than, when you were doing some of these big construction projects in the past and today, Siobhan?

Siobhan Savage: The major things that we had seen was what they costed at bid stage versus what ended up happening to the time you actually win the bid. There could be a 12 plus month, 18 plus months.

So the pricing of a deal reflective of the economy and what happens that's the scary part. So you've got that as a cost pressure and then as, the Lendly CEO and others are saying energy costs, high labor costs because there is shortages in crafts. Therefore they can bump their rates up a lot higher.

So you've got unstabilized, right. Calculations where you don't understand that and then you have all these project overruns, especially when you're working on major projects there's unforeseen circumstances that typically you just can't plan for and any overrun of a project eats right into the margin because they can't scope programs and Then also because everyone's desperate to bid on the work.

They're pricing so low to win the work so there was all these things that I was seeing that was happening in my previous career and Which was directly linked to the pressure that I was constantly feeling about, cost, productivity, even my brother, he, this is so random, but, my brother was building a house, right, and from what he started pricing it to actually, the house nearly doubled in cost over him to build what it was in a space of 12 months, because timber and basic essentials that, to build actually escalated in price and, that's the, imagine that at scale.

Right. Happening in major programs of work that's incredibly stressful. And that money's got to come from somewhere, that's the cost pressure as well.

Nuno Gonçalves: And that's the beauty of what we do does as well. I think there's, we've talked about this about the ability to actually be able to re engineer work and be very bold on the way that you do work to your point in the construction.

It's probably in all the industries that have more. Pressure. It's where you will ultimately need to be bolder, as in the way that you will transform your work with AI and robotics. But what I love about JI is that ultimately we also talk about this responsibility dimension as well. So how do you bring, how do you transform yourself, but also bring the people with you so that the, you can supercharge.

the, your employees to actually be able to do the work that you'll need them to do in the future as well. This zero wasted potential and I always remember that you saying it's not a timeline, it's a movement, right? It's, we want to make sure that it's a force. We want to make sure that because we believe a lot on the potential of people that exist in different companies that ultimately they have the, we provide, we give them the visibility of what's changing and ultimately.

What? Where do we need to upskill and re skill as well? So it does need a new workforce strategy even more now, with all the pressures that you were talking about with this balance of transforming being very bold, but also being very responsible to your point as well.

Siobhan Savage: The one the industry that we're in with construction there is if these companies don't completely reinvent themselves.

They're not going to be around for long, right? This is where I was talking about this on a podcast yesterday. With, one of the leaders at Micron and we were talking about saying this out loud. Sometimes people scoff a little bit and they're, Oh, I can't believe she said bold reinvention.

And, that's terrible. Ultimately, if you do not reinvent, you will be left behind. That's a real thing. And these companies in construction are, you're seeing the cycles of this happening right now. They got to completely change who they are and now is the moment, but to your point, how do we enable them to do that in a way where, any of the listeners here, your CEO really does need you to be bold, but let's look at bold and responsible, and the construction industry is massively going to be one of those organizations that's going to actually need to do that.

Nuno Gonçalves: And can I add another dimension though? It's time because it's, I think it's, you need to be very bold and you need to be very bold also fast. No? Meaning, it's because if you're facing so much pressure right now and the pressure is happening right now, and if you're not ready to face that pressure, you need to reinvent yourself very fast.

Do you think it's, do you feel the same, Siobhan, that it's

Siobhan Savage: Reinvent it or someone's going to reinvent it for you. Yes. Right. If you don't, you're going to have your shareholders doing it for you, or you're going to be delisted or you're going to be aggressively acquired or many things.

So,

Nuno Gonçalves: yeah.

Siobhan Savage: Yeah, we're already late, we're 100%. So,

Nuno Gonçalves: but what we also say, though, is that, if even if you're late, there are some steps that you need to take. And the reality is that you do need a an upskilled workforce with new ways of working. That's the outcome. That's your objective at the end.

But ultimately, first, you need to understand, okay, what is this of reinventing your workforce? How are you going to do this faster, better? How are you going to, how are you going to, Be more efficient and faster and reduce duplication and be able to accelerate everything that you do. And that's the reinvention piece that I think it's, I love.

And I think you need to step back and actually be very bold as we were talking about. Now, once you understand the work that you do today, the work that you do tomorrow, and then you understand how, what are the big shifts, then you need to move this, and understand what is the impact of these changes of work to your, to the workers, to the people, right?

That will be a delta. The work before, the work in the future, the skills today, the skills of the future. So if you then start understanding and correlating work and skills, then you, we understand what the gaps are, which means that yes, you will do this better and more efficient, and you will most likely have to use some of those efficiencies to invest in retraining and re skilling your workforce so that ultimately they are able to do.

Work as you imagine the work will ultimately be in the future. That, those are steps and stages that ultimately you need to go to, and then you need to go through. The faster you actually do that, the stronger you do that, the better you'll equipped you'll be in the future as well. And you'll show you a little bit of what this is.

sivan. This, I think this is where you brought I think a light bulb to the industry, a couple of years ago where people were very focused on skills, right on the right side. Of the slide that we had before. It's, how do we build the skills of the future? And you said, listen, you probably need to step back and you talk about the work first, right?

The insight that ultimately the jobs have tasks and that AI will impact and automate and robotics will impact and automate the tasks. So that's the reinvention piece. And that ultimately the correlation between tasks and skills that, will allow you then to understand, okay, if I change the task, here's the skills that we need.

And ultimately what will be the impact on people. This, listen, I've been in the industry for 25 years ish. And ultimately we were focused on skills. And I think it was just brilliant that ultimately we say, listen, we, for us to get there, we need to do some pre work before. And the work is on the tasks and the subtasks and understanding, how we're going to try to transform this.

And this is the focus of our ontologies. And what rigid does is to give you the mapping you the work that you do today. Across your organizations. Understanding what are the opportunities for efficiency? What are the opportunities for automation? What are the opportunities to acceleration as well?

And once you do that, then how do you Reejig? How do you reengineer, your work and the impact on tasks and on skills as well. But Shavon, you're the creator of all this. Any other flavors of this that you want to that you want to bring to the people that are with us today?

Siobhan Savage: , only that I spent 40 I got to it.

So, it's not we all were wrong. It just, we were all wrong with what we knew. But now it's a different world and technology makes things possible. But yeah. The task is the Jenga blocks, it's that whole, especially in this new world of work. So this toolkit is going to be really important when we think about, how to move forward in that new workforce strategy.

Nuno Gonçalves: Yeah, so giving you and everybody that is joining for the first time So when we talk about a work ontology and many people talk about ontologies and taxonomies differently And I don't think there's anyone that ultimately says, that has a perspective of what this is for us an ontology is.

an aggregated set of data that ultimately allows you to correlate different parts of this data on one side once we talk about a work ontology, we are able to triangulate three things, which is the jobs that are done in every single one of these industries. In this case, in construction, what are the, all the tasks that ultimately exist on those jobs and ultimately what are the skills that are required to do those tasks as well.

and an insight that was really important for me in the beginning of my own journey of thinking differently was the fact that ultimately The correlation between tasks and skills is not a one to one correlation, Siobhan, right? And this better than I do, is that for you to actually be able to do a task, you're going to need at least three to five different skills.

So, having a place, an ontology that actually is able to correlate, to connect what are the tasks, that will require some skills or what are the skills that are required to, for one of these tasks. On the umbrella of a job is extremely Im impactful and important as well. So as an ontology, you'll start seeing the details of work, the Jenga that, the Jenga pieces that Shavan was talking about, and then the skills that are needed to actually be able to do those Jenga pieces as well.

And if you go to the next slide, what that will allow you to do is that if you think this, job by job or. Team by team, department by department, subfamily by subfamily. You'll start understanding what are the potential. Because if you see all the different tasks, you'll see the tasks being done maybe in five or six different places as well.

So why is this happening? Can you reduce the duplication one way or the other? Is your workforce bloated? Meaning being with people doing the same thing and ultimately not needing to do the same thing over and over again. Because we also work and understand to your point, we map work, we can go to the level of I call it the unit of work, the task and the sub task, right?

We can go to that unit and then understand, okay, if we're talking about a production task, there is a repetitive production task. What is the potential and the exposure to automation? What is your opportunity also for automation? So rigid will bring you on this ontology, different insights that you can see also on the screen on one side, right?

We will bring you, the AI potential index, how much exposed you have, you'll be in your, in every single one of your tasks and roles as well. The WordPress both and task duplication, we will also give you what is, what are the skills that ultimately you'll need moving forward. And then. It's very important as well is that no single organization is able to transform everything at the same time We know that there's that some transformations take more time than others We also give you that perspective of when will you be able to start?

Ripping the benefits of this transformation and sometimes of this duplicate this Digitization and, automation as well So you'll see all that information on ontology, and that will allow you to ultimately be able to evolve your organization. If we then start understanding for, and double clicking on the construction workforce, we see that there's 46, almost half.

Of the workforce composition is around construction trade workers. So that's not necessarily a surprise there you have of course the management and admin Personnel that ultimately allows you, from a pmo perspective from a supply chain perspective that allows the organization and the coordination of all this construction, but the biggest Part and portion is construction trade workers in different parts of their own different crafts as well.

Has this evolved since in the past decade from your perspective, Siobhan? Meaning, do we have more management people than constructions workers? Because I'm assuming it's getting also more professionalized than before. Is this shifting? Do you see it shifting as well?

Siobhan Savage: I think it's interesting because I'm trying to figure out what's in the 25 percent of others.

I'm looking at the data, and wondering what clusters in there. This feels pretty typical, compared to what I've seen. Depends on the scale of project size as well. Depends on how much management's required. Because if it's a PMO major development, or if it's a smaller, mixed development depends, it would depend on whatever scale.

But no, this feels about right. And I think from a ship perspective, there is just so much opportunity. In this space to do things in a different way, and one of the things that, I was looking at when I was prepping for this is the it's not just about cost. It's about safety.

So the construction industry has really focused on safety because of ultimately deaths that will happen if they're if they're not safe. And, there's not just a cost optimization and opportunity, but it's also safety, why safety. Safety. Safety. Why send someone up to do a survey that a drone could do?

there's really simple things that AI is not just here for optimization, it's actually for doing right by your workforce. So I think this, it'll be really interesting to go through the data around, where we're focusing at as well, Nunu, in terms of where you see the most impact.

Nuno Gonçalves: Yeah, and thank you for that. I think it's when we think about AI and automation potential in construction There's we believe that there's three high impact roles that stand out from the data that we've seen Why don't on one side these heavy equipment operators that are enhancing efficiency with AI powered machinery improving precision and reducing downtime on job sites, which is, something that is also very important.

But again, we're talking about AI powered machinery that again, that should ultimately drive to more safety as well. We are seeing these construction laborers, right, that are leveraging also automation tools to boost productivity while maintaining the hands on expertise essential to the industry as well.

And this and last but not least to your point, and you were just mentioning this surveying inside analysis that are using AI driven modeling and drone technology to accelerate the, side assessments and optimize project planning is as well, right? Which is incredibly important, for the entire journey of a construction, from the beginning till the end as well.

So these roles are at the heart of construction's transformation, to your point. Driving safer, right? It's number one. And I love that faster and more intelligent workflows in an evolving industry as well. So that's where we're going to focus also today. As well. Yeah.

Siobhan Savage: Do what was really funny when I first started my career?

I thought it was mind blowing that I was working in an engineering company and real ways and was a big part of our business and it was mind blowing that there was a drone now doing what a human used to do, which was checking the lines. If a tree falls or you imagine back before that someone literally would have had to have went out and checked all the lines from the safety precaution perspective to make sure that, if a train goes over a tree, that's going to take the whole train off.

Right. It was mind blowing to me that back then that there was this capability for ability for, that was early in my career. And I remember just thinking, wow, that's fascinating. And that was my first little hit, what? Towards robotics and thinking. Hold on a second.

That makes so much sense to do it. So I think there is already so many examples of in construction where they are optimizing. You see these, the efficiency, you remember when efficiency come in is such a big thing in the market where, your Green Star rating buildings, these are all AI powered.

they know when to switch on lights because AI detection, they know when your plumbing is about to go, because it can see the pre signs before the whole thing goes down. There's already some incredible examples of the use of AI and technology, but I think we're about to move into a new era where we typically haven't touched these traditional, roles.

And I think. Especially around these ones that you're talking through now. I'm really interested to see timelines and all of that as well,

Nuno Gonçalves: , let's listen. Let's double click on this one and I'll turn it over to you on more details of the data and specifically for these three dimensions that we're talking about this heavy equipment operations is construction, labor and surveying inside analysis.

There's a bunch of data that we were able to see from where we can focus. And what is the opportunity for every single one of them? Do you want to talk about it, Siobhan?

Siobhan Savage: , I think if you can run through the numbers, and I'll give you, from my perspective of, actually, it's, the thing that's gonna be really interesting is this data.

And then how would I use this if I was back in my previous career? I think that's the thing. And more just, us walking through this together in terms of the efficiency. So, if I can look at this less as a Reejig, are you cool for me just to talk this through if I've, if you'd given me this, as a workforce strategist, here's the thing you're going to be in a situation where your CEO is under incredible amount of costs, right.

And there is this crazy amount of pressure that's happening. If you're sitting down, you're looking at these operational rules, and you can see that 55 percent of this rule could be improved through autonomous machinery, there is an actual 55 percent based on the maturity of technology today, we would see that have an impact.

Of 20 to 30 percent increase in your margins. We're all about building margin machines right now. That's what your CEO needs to do is improve the margins. So that ability to create that ROI and really look at that impact. This is where we're looking at a big consumption of cost reduction, not only in terms of the fuel efficiency, but also just in the worker profile as well.

From a workforce demand perspective, we're seeing traditional rules, decrease, but there's an increase in the AI supervision. So, the whole story, when you take out tasks and you change rules, you build in new tasks and rules that you've never had before, because now suddenly you've got to have a manager who's operating.

AI machinery, which is a completely different thing. So we're looking at that deep impact of the workforce itself. And what do we think, the data suggests that in what we can see, there would be a 15 to 20%, reduction in the traditional operational roles, but you'll still need to think about that net new task and where will there be different requirements to, with this new worker and, no one is going to automate their workforce overnight.

no one is going to do this overnight. Everyone is going to look at this in terms of, when will I start to see the full value? Because you don't want to be going to your CEO and promising that this is going to, do all of these magical things within, a couple of weeks.

You've got to put some timeline around it. And what does that look? We're seeing here at 12 to 24 months ROI times implementation. And that's training the team. That's buying technology that is ramping this whole thing up. So we're really focused on, that actually seeing the full integration into a major construction organization.

And this will change the skill profile, Nuno, of what the workforce will need. We're going to see new skills AI robotic systems monitoring, predictive maintenance and fleet operations. So that predictive maintenance that I spoke to you about earlier in my career, which was these green buildings, which are predicting maintenance before it even breaks so that you don't have any downtime and it doesn't cost you the fixing, right?

These are all things that, when we were looking at those green energy buildings, those skills didn't really exist. So we're starting to see now a big push from the industry to start upskilling and reskilling folks and pivoting them in these things. And when we start to look at these heavy equipment machinery roles, that's a big shift in terms of looking at how we're moving that workforce.

But here, that's a really great opportunity for us to look at it when you're. When you're thinking about the construction laborer, this would be the one that is probably one of the most hands on hand labor roles where it's literally, on a construction site itself.

What do you feel when you're seeing this data around the laborers?

Nuno Gonçalves: I think there's a couple of things. And one, I was fascinated and I know you're already on this slide, but I was fascinated on the previous one where we're talking about because most of the conversations that we have, we talk about efficiencies, which means cost reduction.

We also need to talk about also the time the investment that you need. Right? Because when we're talking about automating and having machines that are more autonomous and so on, there's an investment that you'll have to do. So there's a plus and a minus. So here we talk about the reduction of costs, but we also need to talk about the investment that you'll need.

It's not only the investment that you will need on the upskilling and reskilling the people and finding the right skills, but also to be able to invest on the machinery, to invest on creating the environment where people will be able to do work differently as well. It's what you see also here, right?

So it's, it, if we say robotics can increase task execution, speed by 50%, okay? But if we don't have those robot robots, what we're gonna do. So you will need to be able to, it'll have to be a plus and a minus, some, game and a subtraction game as well. Hmm. But again.

Huge opportunity from an operational efficiency, huge opportunity from a reduction of cost and reduction of labor needs that you have. It's creating a significant skills gap that you need to that you need to, use and ultimately reduce one way or the other. But you also need to change. And be very bold on the way that you are investing on how you're transforming your work.

So if you're thinking that, oh, listen, this means that I'm just going to let go 20 to 30 percent of my workforce and therefore, gain the margins or better margins, of course, because you have lower costs. It's not the case. This transformation will require an investment that yes, will allow you to do more faster, better, safer.

With less cost, but there is there's a period where you need to invest to be able to get there as well. And this is not different either. Now we're talking about construction labor. And here, Siobhan, I'm seeing and I would put here people that are very specialized. Jobs, right? It's jobs that in some cases, there's only a few things.

Few people in the world that are able to do this at scale that some companies do as well. So that scarcity is an important one for me.

Siobhan Savage: Yeah, the robotics, what I'm seeing in the construction labor side, so think of bricklayers and, skill sets that.

Right now, AI powered robotics and automation are increasing task execution speed. By up to 50 percent because you've got repetitive tasks bricklaying and concrete pouring, not now being fully automated. And when you think about the major amount of, construction labor that requires physically building, you can see a high level of, labor costs associated with that type of role.

And if we're not, and you see a lot of the European, robotics that are doing the bricklaying and it's quite, hypnotic to watch. All of the Brick Lane robotics. I have actually spent quite some time watching because the precision and just the way it's being done is incredible. And even the BIM and the pre modeled.

pre concrete casted that are already pre made. So they're just bolting these things together instead of traditional, this was the stuff I've seen in my previous career, which again, was mind blowing to me because it felt so futuristic, but that's going to become pretty given the cost efficiency and pressure.

So, you're seeing the shift in driving 15 to 25 percent reductions in labor costs, which is accelerating your completion time of project as well. So remember that cost overrun I was talking about. That kills projects, that kills businesses, bidding on work, getting the cost wrong, going over time, you make no money.

You basically spent two years building something and make nothing, that kills you. So you'll see a lot more acceleration in improving overall margins and improving, time completion and also due to skill shortages that people are resorting to this as well because there's such in demand labor, right?

And the workforce demand is evolving. So with automation, reducing manual labor needs by what? 20 to 30 percent over the next five years, we're shifting our focus to more AI assisted operations. And I think one of the things that I have seen in probably the last 18 months, and it could be the Margin pressure and the cost pressure.

This is accelerating faster than I thought, we had a period where this was really cool and robotic and scientific when I started my career And now it's becoming a norm. Now we're starting to see this ramp up and AI driven construction technologies are typically integrated, 18 to 36, months depending on the scale of what we're talking about.

So the investment of this Is absolutely an upfront investment, but the overall view of how to deliver a cost effective project is now going to be a lot better, in terms of what 15 to 25 percent costs in reduction of actual project labor. So that's where we see that happening.

And again, back to that, and, would love to know your thoughts. Again, it comes back to this very different skill set. What would have been a traditional laying bricks and looking at, different laboring types is looking for a different skill set.

Nuno Gonçalves: Yeah. And I think in some cases, and we somehow use this, the same word.

But that means do two different things. Upscaling and rescaling means two different things. And in some cases, that means that you will have to, it's people that are in one same profession, and it's about to change and somehow incrementally. So it's an upscaling. But in some cases, and I would imagine that would be the case here, especially when we're talking about drones.

And we're talking about this. And on your next slide, you'll have the surveying piece as well. You will probably have to reskill people and say, Listen, people that have done something that is around technology based that might not be necessarily focused on construction might have better skills or might have more adjacent skills than people that have been in construction, but doing something else, more labor work as well.

So how do you then step back and not only understand the work and not only say, Okay, we need people only in construction, but actually. Get out of the boundaries of your own industry and think that these might be completely net new skills that you have to bring to your industry that don't exist one way or the other.

I could see these folks. That are, doing these surveys inside analysis coming from, all different industries as long as they have the skills that are somehow adjacent, and then you're able to upskill them or reskill them in this case, to a whole new job. How exciting that is from a personal perspective, but how much inside, and I've been a learning and development leader for many years, but how much inside you need to actually have to say, listen, it's.

We probably need to think out of the box and not only in our industry and go grab someone in the tech industry or go grab someone in the device industry, right? Because devices in pharmaceuticals are also very advanced as well from a sensing perspective, diagnostic perspective. Can you use that from not only in humans, but also in buildings and in land and in construction sites and so on?

Siobhan Savage: ,

Nuno Gonçalves: I think that could be very fascinating to be able to do. Not only the sub skilling, but the re skilling from people that you would never imagine would be able to work on a construction industry as well.

Siobhan Savage: Yeah, and I think the point I was making to you at the start about the surveying and site analysis, just the ability for AI powered drones now can increase the efficiency of up to 60%, which creates an overall margin impact, of 10 to 20 percent overall savings.

it's incredible and also has this massive impact on workplace safety. The recurring impact that you get from this in a very short space of time between six to 12 months is just incredible. So I think you'll see a lot of movement towards this, which, you see a lot of, news where it's a lot of gamers are being brought in, to drive the big construction, trucks.

Because they're in the drones, because the game boy and the gamers are actually really designed really good skills for exactly doing that. And I think this is where you're going to see AI driven, piloting. You're going to see all different types of surveying. So it's, I think this one is going to be a really interesting one.

And look at the example of the gamer, I love that. I remember BHP in Australia, one of the biggest mining companies in the world, and they have those massive automated trucks. And they brought it in for safety reasons and down in the mines and they were hiring for gamers.

And I thought that was, when a guy was, wow, that's the way that they're thinking about the transition of skill here and the skill adjacency was actually really cool. And they did this really cool campaign. I'm almost sure it was BHB, but it was, whoever owned it was great.

but I think as well, the AI potential index metrics of all of these roles and the AI potential metrics just for folks is about the potential for AI to improve. Not just the efficiency, but reduce costs and enhance performance. And it's also adjusted based on, where is the actual maturity of the technology today?

So that we can give you a pretty decent estimate of, what is the opportunity? And then the operational efficiency. It's considering the increase of input and the change of cost base. So, are we going to see a better value delivery here because you make these decisions and these three critical rules we're talking about have really good opportunity based on cost pain and opportunity, not just.

All done to cost, but really high opportunity here for prioritization. And if you're in your, workforce strategy rule or your HR rule or AI or in any workforce optimization, really thinking about prioritizing these level of rules for AI investment to make sure that you're bringing them on your journey as well.

So I'm excited to hear what you're going to tell us about becoming the skill building powerhouse connected to the construction, given your expertise in this space.

Nuno Gonçalves: Yeah. And I think a lot of what we're seeing, I think we're already probing it a little bit on this changes, right? Is that how do you go from a more traditional construction job to, an augmented AI robotics, augmented, job?

It's a significant shift. And one of my concerns is that will we actually have people that will be able to actually make that shift or not? Because again, I think it's very significant as well. We've selected these three, the, this construction estimator, right? Which probably are those that are very scared because if you estimated somewhere around, last year to a two, three years project and not counting to the inflation, what does this mean?

And one way or the other to actually be. A job that is actually very much supercharged by A. I. And from a project management and coordination perspective as well. We've been talking about this cat technician, which is very special. It's been a job that has been very craft job, a craft job.

It requires a significant and not Yeah. Widely available set of skills to becoming a B. I. M. Specialist. We'll talk a little bit about it as well moving forward and this and we'll talk about the surveying technician and this A. I. G. I. S. Drone operations as well. And for those that are joining, that don't know what G.

1. S. Means it's geographic information system. So how do you are you able to understand what that is and not being only a surveying technician on the ground. But actually being a surveying technician on the drone and reading, dating and understanding data and so on so forth. So significant shifts as you will see in the next pages.

Siobhan Savage: That BIM change, that transition from CAD to BIM has been happening for when I was early in my career with WSP, that was one of the most critical shortages of skills that we could see in. Our rules at the time, which is really interesting, because it still proves to cause the same shortage requirement that we haven't filled that skill gap.

It's still there. So it's really interesting, looking at where that goes to next with AI as well.

Nuno Gonçalves: So what do you see here is one the shift that we're talking about, from two and just Helping everybody navigate on the slide here as a construction estimator, what are the skills that you need, More traditional cost estimation and budgeting but actually if we want to be more of a project commercial manager that the shift is for me is a significant one, but still very much attainable within the, in an upskilling direction where you will need to learn more project management and data analytics, right?

Because this is an assumption that we sometimes make is that people that are actually, focused on numbers on cost estimation and budgeting might be good also in data analytics. It's an inference, but there it's a big shift as well It's not only about estimations of costs But also the data analytics of an entire project moving forward a significant shift We're talking about the three to six months of training.

So we're it's a significant in evolve evolution, because it's not to be underestimated. Because if you've been doing this, more traditional way for 15, 20 years, Learning something new sometimes is not necessarily the easiest piece When we're talking about the re skilling ROI, we believe there's a significant ROI, that you will bring that you have from this evolution.

Of course, you are. You're rescaling and upskilling one way. In this case, someone to a job that is probably more expensive. But that will mean that you have to gain some of your efficiencies off of this transition to be able to somehow finance the higher cost that you have on the other side.

And we talked about this with Mike is that you're almost creating a new job, right? Siobhan and that means that yes, it's almost a, it's a motivation for someone to be able to actually do the transition is that you're going to go from a construction estimator to a project commercial manager.

yes. There's straining, there's everything evolves, and you will have a higher salary also moving forward. So how cool is that to be able to, it's a pivot. A

Siobhan Savage: Yeah, it's the pivot. I lo I'm obsessed with the pivot because the pivot is destigmatizes. Things in high growth technology pivot all the time.

And it's seen as cool and edgy. Right. It's, why can't we do that with career? Why, what? So I think that whole, every redundancy is an opportunity for a pivot is really important in the adjacency here in the timeline to value and re skilling ROI I think is really impressive as well.

Nuno Gonçalves: Yeah, I think the last thing that I would say as well is that if we have people that are listening to us that are that have been learning and development folks, we all know that we're talking about learning and developing some multi trillion dollar industry as well. It's not about necessarily the cost is actually you having the understanding of where do you need to invest.

So if we shift. The dead those trillions of dollars to the right things. This is what we're saying here, and we are able to finance and ultimately upskill not only upskill, but give a better standard of life to these folks. Imagine the power that we're bringing to them and to the rest of the population as well.

So, we also start talking about there's tons of data. There's tons of programs and trainings that will allow you to upscale there. You see some examples over there on the, again, the BIM fundamental for engineers, advanced BIM applications and so on and so forth.

There's a lot of stuff over there. This is just a first glance of what you could eventually do, but I do love this the modeling, this building information modeling, the BIM piece of. Of this part of the job. It might be here as well, where we can bring people from other industries as well.

Yeah, I

Siobhan Savage: agree. I agree. What have we got? We've got the surveying technician. Oh, yes. I this one. I'm into the drones at the moment. I think they're just the skill adjacency, that gamer example. I thought that was such a smart, whoever was in that learning team that thought about that was smart.

That was super clever.

Nuno Gonçalves: And yeah, again, it goes back and we typically bring here the biggest opportunities that we see. These are significant shifts, but shifts that are attainable, shifts that will give you the efficiencies that will give you the right skills of the future.

but, shifts that you will have to invest on, right. From one way or the other. What else do you have?

Siobhan Savage: I think the key, I think the key, focus and what the data that it's telling us is that, this bold reinvention is incredibly important, this industry more than ever needs to and are already late to the party on this one.

And there is so much opportunity for them to think about this in a different way. And, the whole point of these masterclasses is not to sit with the whole ontology, it's to give you some form of understanding education so that you understand the opportunity that exists and get you started.

you gotta get moving, right? You gotta start. And it's just getting you with that momentum to go forward. And I think that's where it's going to be really focused on. Looking at that bold reinvention and then on construction projects, as, we were just on a call just before and it's all about mobilization, it's all about moving because you once you complete a project, you packed up your toolbox, you go and you build another one, it is this constant cycle of that.

So it's really focused around that. And then I think that, the final component of this whole Scenario would be then the re skilling, so in a scenario where you are going to be bringing in AI, adoption, changing, re engineering, that you're looking at that pivot. What is the opportunity for you to pivot, but also what skills can you bring to the business that you can give to your workforce?

that example of imagine being a gamer and then driving the biggest trucks. Because, in the minds this is the opportunity and the culture of opportunity that should exist within your organization and to think that. There's a question in the chat there. How do you assess the retention impact and the ROI in the career pathway?

I've got an answer, but I'm wondering. Do you want to have a crack at that?

Nuno Gonçalves: I'll start with one piece. I think a lot of the retention impact that we assess is related to what's in it for the person itself, right? Because retaining someone is very personal. And one there's on our modeling.

Of course, there's This proactivity of being able to bring a transparent transparency of the evolution, which in itself is something that we are seeing that actually impacts the retention of someone. So imagine yourself saying, listen, being in a conversation and saying, listen, we, you are, you've been a construction estimator.

Here's what we're going to do. We need to actually evolve to become a project commercial manager moving forward. We understand what are your skills. We understand what are the skills that you need to have in the future. We will be with you to be able to one way or the other. Be able to upskill you or reskill in this case to have, a new job moving forward.

A lot of these transitions, will come also with, salary increase and better standards of life. So a lot of what we estimate from a retention perspective is also related to, these shifts and what's in it for the person is itself. Now it's a model and in any single model is not to give you, a specific number, but to give you a direction in order of magnitude of retention impact here as well.

So that's the way that I would somehow, start to answer to this. This question should on interested on your perspectives as well.

Siobhan Savage: Yeah, that's the predictive model of what we would expect to see. And then there's the reality of what we've seen. Then once we move from bold into responsible and we're looking at, massive organizations, remobilizing their work, you get a massive increase of employee engagement because those folks feel you've seen and heard them that you are actually navigating them.

In a world now as well and this is not just the construction industry, I think the whole industry where our employees are genuinely quite afraid. Psychological safety at work is actually getting hit a little bit because folks worried about AI, worried about recession, worried about politics, worried about all these things and job safety.

And the idea so be that you would be talking about your organization and showing people that yes, but we're going to be bold and we're going to be a change, but you're creating a culture of opportunity where you say to folks that we're going to enable you and show you the path forward and whether that's through career pathing succession planning is where I spent a lot of my time right now.

with organizations because building the critical bench and folks being brought on that journey, whether you're bringing in AI, thinking of remobilizing, there is this output that you will see in terms of engagement ROI. We see the longevity of the employees go up in terms of how long they stay with your organization because you've invested in them.

this is the stuff that you see that's really underneath the hood and it's different slightly by percentage and each customer, but the storylines all the same. Boldly reinvent your workforce, be really responsible in building your critical bench for succession planning, pivot your people into meaningful work.

And that will pay you back because your workforce will be more productive. People will stay longer. Your folks feel seen and heard. They have a more value commitment to you as an organization. And you get that extra work thing that happens, when people actually really do care and they're not just checking in.

So I think this is why we're so obsessed with the both sides of that. And I think as well, ultimately, all industries right now are going to be going through this and it's really up to leaders you to figure out how do I help my CEO achieve the things that I know are being talked about at our board level while also making sure that I look after my people.

And this is what this is all about, right? This, the whole point of this data is really to focus on helping leaders you think about what is the opportunity for me to really help here? Whether it's from task duplication, AI adoption, reinventing the workforce, and then right through to making sure that you have the right workforce.

Enabled to see you through to this next new era of work as well.

Nuno Gonçalves: Yeah. And when we talk about also the ROI is that, it depends on job by job, but the real and it's also impacted by the volume of change as well, right? But in every single one of these cases, you've seen a significant ROI that it means, if from a business, is this something that it's worth me doing or not, right?

and the answer is absolutely yes. But it's not only a minus, it's not only a subtraction gain, it's also an investment gain. One of the things, and if from a psychological safety perspective as well, and one of the Dimensions in one of the that I use and one of the data that I use is the other one Index and trust index trust is really important for retention as well sophie, so a lot of the trust is being able to be transparent to Everybody knows that we are transforming ourselves that we're changing as organization But the more transparent you are with the people that you have The more trust you will gain and therefore, the more sponsorship of the change you will have as well there.

But it's a really good question. The everything that we're showing has a significant ROI as well for us. And it's everything that is really fun. It's been fantastic so far, Siobhan, and it's really good to have your perspectives as well. You could thank you. Just on the previous slide there.

if everyone if anyone if you want to book a personalized skills master class for your organization, that we also do this. We are doing this as an industry. But if you want to say, okay, yes, by industry, but I would love to know more. What does this mean for us? Then reach out. You have the QR code there.

We're more than happy to jump on a conversation understanding what we're doing. Who you are. What are you trying to do? And depending on your state of evolution, what could be the opportunities that you will have in the future as well, giving you data for better decision making moving forward.

So, just being us use the QR code and more than happy to jump in a conversation moving forward.

Siobhan Savage: I'll try on the next slide to get time.

Nuno Gonçalves: Yeah, well, maybe I don't know. This is an

Siobhan Savage: exclusive. I don't know.

Nuno Gonçalves: so we'll have, looking ahead. Our next, masterclass will be in April. April 3rd. At 11 a. M.

Hoping that, everybody from different time zones could eventually join us as well. We'll bring back Mike if Siobhan doesn't push him out, I'm on holidays. But we'll be talking about a very cool and an industry that is dear to my heart with this consumer goods as well.

So if you found this interesting, if you want to know more, if you want to chat more, if you want to have, if you have more questions of this industry, come and join us. April 3rd at 11 a. M. But for now, thank you. Big thank you for finding the time. I know how busy it is, but I also know that by the time that I say, listen, it's construction industry, you'll say, I'm going to be there.

Siobhan Savage: Passion, force of nature of passion. But yeah, thank you. And if anyone's listening to this right now, there's just this incredible opportunity for us to do this differently. So don't waste the moment. That's the only thing I would say, let's go. Thank you, everyone.