Newly released research on the state of the capital projects industry reveals that as it battles the remnants of the pandemic, an overwhelming majority of owners and contractors in APAC are optimistic about their organisation’s growth prospects for the coming 12 months. However, they are also mindful of certain risks.
InEight Inc, a global leader in construction project management software, has recently launched its first annual Global Capital Projects Outlook. The Outlook – drawing insights from new research conducted with the world’s largest capital project owners and contractor construction professionals across the Americas, Europe and APAC – focuses on optimism levels and digitisation, and found that despite COVID-19, 93 per cent of respondents in the APAC region are either fairly or very optimistic about their future, and 89 per cent believe their organisation to be resilient.
Digital transformation is considered the biggest short-term source of opportunity according to 78 per cent of respondents in APAC with data analytics, artificial intelligence and machine learning being considered most critical for success for the next one to three years.
However, respondents are divided on the ongoing impact of the economic situation, with 59 per cent identifying economic recovery as an opportunity, and 52 per cent identifying economic stagnation or recession as a risk to their organisation’s growth in the coming year.
Despite facing challenges such as border closures and material shortages, respondents are largely positive when it comes to improvements being made by the sector to deliver projects on schedule. Though, when it comes to delivering projects on time, 61 per cent of respondents in APAC say that in the last three years the number of projects delivered on or ahead of schedule has increased, compared to 56 per cent and 54 per cent in Europe and the Americas respectively.
When asked about delivering projects on or under budget, 55 per cent of those in the Americas and 56 per cent in Europe report a significant or slight increase in projects being delivered on or under budget, compared to 52 per cent of APAC respondents. Delivering projects on budget remains a challenge within the region, with 20 per cent of APAC respondents revealing that the average cost of a project that goes over budget is 15-20 per cent over the original approved budget.
Encouragingly, 89 per cent of APAC respondents are confident of completing future projects on or ahead of schedule, and 91 per cent confident of doing so on or under budget. These figures reflect the highest levels of confidence in comparison to the 83 per cent and 82 per cent reported globally.
Commenting on the Outlook, Rob Bryant, EVP APAC, InEight, said, “It’s encouraging to see that the results of our Outlook show a construction sector in the APAC region that is full of confidence and optimism, despite facing tremendous challenges this past year.
“Capital project spending is on the rise in APAC, as governments go on infrastructure spending sprees to avoid recession, which has led to high confidence levels locally.
“While investment in the sector is increasing, organisations increasingly acknowledge the importance of digital transformation to keep projects on time and on budget.
“Respondents in the region are acutely aware that lagging behind competitors in their digital transformation efforts presents the biggest risk to their organisations in the coming year. In fact more than half of respondents list this as the biggest threat, compared to 30 per cent in the Americas and 37 per cent in Europe.
“The region shows strong appetite to invest in digital transformation, but this enthusiasm is being hampered by difficulties with integration and implementation, as well as issues such as a lack of available capital and return on existing investments. Pleasingly though, many respondents still report significant investments being made, or planned, to take advantage of the benefits digital transformation has to offer.
“Pairing this motivation with APAC’s sizable capital project pipeline, further digitisation could not come at a better time,” Mr Bryant said.
While regions across the globe gather digitisation speed at slightly differing paces, one thing they have in common is that the construction industry is foundational to the success of economies and societies worldwide. It is encouraging that despite a difficult year, respondents remain resilient and optimistic for the future; committed to continuing as a vibrant, vital and innovation-minded industry.
To access the full report, visit http://ineight.com/globaloutlook-2021
This sponsored editorial was brought to you by InEight. For more information, please visit www.ineight.com.