Aurecon's Our Digital Futures Market Research: The Digital Horizons Insights

Expertise Digital engineering & advisory Our Digital Futures The Digital Horizon

Thriving in the digital future requires focus now

The fourth industrial revolution promises unprecedented change for many industries, including the architecture, engineering and construction sector and the industries it supports. This new industrial revolution is characterised by digital platforms and systems and their overlay and integration with physical assets.

“The future impact and potential of ‘digital’ is undeniably immense, but to create sustainable and productive businesses which are competitive in the long-term, organisations must build their capacity to thrive now. It’s vital to focus on the ripple, not just the rock, have a clear view of where actions will end up, embrace relevant innovations and take a human-centred approach to decision making.”

Dr Andrew Maher,
Group Managing Principal,
Eminence, Digital & Innovation

Until recently the built world and the industries catering to it have been somewhat immune to the ongoing disruption caused by new digital technologies. However, with advances in technology (particularly the pervasiveness of data-related technologies), the architecture, engineering and construction industry is poised to experience change on a broad scale.

This presents both a risk for existing organisations, as well as significant opportunity for those prepared to evolve. Digitalisation is reshaping cities, transforming business models and integrating physical assets with their digital counterparts.

New opportunities are being unlocked for people and organisations as technologies continue to evolve and shape the workforce of the future. ‘Digital’ is moving from a disruptive force to an enabler of integration, with the potential to create a better, more sustainable and productive world.

As we move towards this digital future, even more important than knowing what the current landscape looks like, is understanding what the years ahead may hold.

The Digital Horizon report shares a glimpse of what may come – how the energy, transport and property industries might look and operate, what the workforce of the future may be, where organisations should focus and what it means to properly prepare now.

or read the full report below.

Explore the Digital Horizons report

The Digital Horizon insights: our key findings ›
The digital economy: physical assets need to catch up ›
Actionable insights: addressing our clients' most pressing questions ›

How organisations can prepare ›
Micro-scenarios: exploring the future of industry ›
Case studies: how organisations are preparing for these futures ›

The Digital Horizon insights

Our Digital Futures research with clients, industry experts and futurists highlighted key findings about the characteristics organisations will need to thrive in a rapidly changing technological and economic landscape.

The research showed widespread agreement that the impact of digital technologies and trends will change organisations and markets considerably. Those likely to thrive into the future will have properly prepared themselves by anticipating change and building their capacity in the following critical areas.

Systematically anticipating change

Whilst many organisations still employ a ‘wait and see’ strategy or invest in innovation initiatives based on guesswork, organisations that systematically identify and understand signals, trends and other indicators of change, and develop plans for how to respond with informed investment will have an edge.

A recent study of European firms found that over a seven year period, those with foresight capabilities and processes increased their profitability by 16% and their market capitalisation by 75%. Those that did not invest in systematically understanding their potential futures saw their profitability decrease by 44% and did not record any changes in market capitalisation.

Through the use of futures research, organisations can develop the methodologies to turn signals and trends into plausible scenarios, use these to inform how digital technologies may reshape markets and invest preemptively to capitalise on these shifts.

Understanding the business and economic implications of technology

Organisations that move beyond viewing ‘digital' simply through a technology lens to understand the fundamental business implications sitting behind it will be best placed to successfully evolve into the future.

This understanding of the business and economic implications of digital technology is fundamental for organisations to assess how their value chain is evolving, where new profit pools are emerging and how to effectively adapt their business model to suit these new paradigms.

Planning the future workforce

Aurecon’s research showed that the majority of organisations view upskilling their people as critical for future success.

Depth interviews indicated that the exponential rate of change has led to the rapid depreciation in the value of current skills and knowledge in the workforce, as new technologies, tools and ways of working continue to emerge and evolve.

This continual rate of change is emphasising the need for continuous learning and requiring organisations to give their employees more opportunities by automating repetitive tasks and redeploying people to higher value activities.

Focus required for organisations to thrive
(next two to five years)

Focus required for organisations to thrive in the next 2 to 5 years - Aurecon Digital Horizon Insights 2020

Focus required for organisations to thrive (next 2-5 years) - Aurecon Digital Horizons 2020

Embracing new technologies

The need to embrace new technologies was evident from the research. Organisations that can effectively adopt new technologies to enhance their products, services and customer experience, as well as drive internal efficiencies, will be well positioned.

As we navigate the digital horizon, technologies relating to data capture and analysis will be critical for creating new value through enhancing products and services and supporting customer insights. Technologies that drive automation will be critical for the bottom line.

A deliberate and cohesive digital strategy

As highlighted in The Digital Landscape, a central and cohesive digital strategy with a balanced focus on internal activities and external market engagement is crucial for future success.

Organisations that are able to develop a strategy which connects people, processes, systems and assets are likely to be best positioned to realise the full potential that digital ways of working can bring.

The design, construction and management of physical assets needs to catch up

“We’re entering a ‘post-digital’ era. The major conceptual disruptions that the digital era has brought have already largely occurred. Now the focus shifts towards seeing how these disruptions can be integrated and introduced into our everyday practice. This is where we will see an even greater impact and change than we have experienced to date, and organisations need to be ready for that.”

Associate Prof Dr Kristof Crolla,
Architect, Hong Kong

Digital technology is increasing the rate of change and creating more complex business environments. According to Aurecon’s research, most agree ‘digital’ will continue to cause meaningful changes for both their organisation and sector, and that the impact of digital change will only strengthen with time.

The clear consensus that digital has caused moderate change now, will cause considerable change in two to five years and significant change beyond 11 years, indicates that although disruption is present in many industries, the true effects have not yet rippled into every sector. This is particularly true for the part of the economy that designs, constructs and manages physical assets.

While some survey respondents believe their organisations are very capable of thriving in the digital landscape, more than one in two respondents believe their organisation is, at best, only somewhat capable of thriving.

How organisations see their capacity to thrive in a digital economy
(next two to five years)

How organisations see their capacity to thrive in a digital economy in the next 2 to 5 years - Aurecon Digital Horizon Insights 2020

How organisations see their capacity to thrive in a digital economy in the next 2-5 years - Aurecon 2020

As this sector has been slower to embrace digital technologies, there is a unique opportunity for organisations to learn from and leverage transformations occurring elsewhere and use that knowledge to anticipate outcomes and ensure digital investment reaps maximum value into the future.

Our Digital Futures shares actionable insights to help our clients address their most pressing questions

What will my industry look like in a digital economy?
Is my business model fit for a digital economy?
Do I have the right asset base to compete?
What does my organisation’s workforce of the future look like?
Does our current workforce need to upskill?
How can I better anticipate change, not simply respond?
How can I stay up to date on emerging technologies?
How do we create a culture of innovation, creativity and collaboration?
How can I identify the critical digital skills needed for our organisation to thrive in the future?
What learning and development experiences are needed to extend the skill set of our people?
Where do we start in building integrated networks of data?
How can we incorporate automation into our business processes and offerings?
How can I digitise and commercialise our intellectual property?
How do we scale our innovations beyond experiments?

What does your future look like?

Unearth opportunities and stay ahead of the curve by exploring what you can do now to shape your future.

Employ futures research to examine trends, emerging issues and weak signals, and develop strategies to respond to potential future operating environments, including:

Identify and understand the range of trends, emerging issues and weak signals that could impact your business using a Horizon Scan. Through identifying and unpacking signals of change in the external operating environment, we can understand potential future environments.
Demystify the long term using Horizon Mapping. Understand the long, medium and short-term impacts of change to generate innovations, make sense of trends and identify uncertainty.
Explore the complexity and non-linear change with Systems Mapping. Apply systems thinking and deep knowledge on ecosystems to explore the interaction between trends to examine broader patterns and rates of change.

Identify and assess the technologies that will impact your businesses with Technology Mapping. Use a systematic approach to categorise and assess the evolution of technologies to diagnose risk, applications and readiness for implementation.
Develop a clear understanding of the range of your future with Scenarios. Help prepare for the future and reckon with uncertainty by developing a better understanding of the range of plausible future operating environments.
Identify and unpack the impacts and implications of change through Implications Analysis. Identify and understand the implications of future operating environments and develop strategies and tactics to respond.
Stress test your strategies and action plans against potential futures. Test the resilience and robustness of your strategies against the different ways future environments may evolve, shift or diverge.

Extract greater value from physical assets by adopting fit for purpose asset strategies that are connected to strategic and operational imperatives, using forecasting, prediction and financial analysis.
Create a digital profile of existing and real-time asset behaviour to translate data into knowledge.
Embrace data and analytics to make smart and strategic decisions.

How organisations can prepare

1. Apply futures research to determine digital investments

However, depth interviews with business leaders and futurists around the world indicate that this voracious appetite often leads to investing based on hunches rather than statistical data, potentially limiting the effectiveness of the investment.

This insight reaffirms the increasing importance of organisations to look externally and develop systematic and deliberate ways to monitor the ever-shifting digital environment, anticipate change and prepare themselves for the future.

Futures research tools such as horizon scanning and scenario planning allow organisations to assess how digital technologies and trends will impact industries helping them to inform, define, execute and persist with strategic initiatives to proactively respond, rather than simply react.

As we head into the future, many industries serviced by the architecture, engineering and construction sector will transform.

Those who stay up to date on emerging trends and new technologies can turn disruption into opportunity by knowing what is being developed, what is available, when to use it and how, when it will likely reach maturity, how it will likely impact their industry and how they can respond commercially.

Our survey data revealed that investment in digital is a high or critical priority for two in three respondents, which suggests both an appetite and the means for developing digital solutions in the coming years.

Digital investment priority

Our survey data revealed that investment in digital is a high or critical priority for 2 in 3 respondents, which suggests both an appetite and the means for developing digital solutions in the coming years.

2. Embrace and embed critical technologies

Greater disruption is inevitable as new technologies connect the physical and digital worlds at a pace and scale never witnessed before.

Looking ahead, our research shows that data-driven tech trends, such as big data, data analytics and cloud computing are thought to be the most critical technologies for the architecture, engineering and construction sector over the next five years.

While these technologies have been applied in discrete areas of the architecture engineering and construction industry, it is the ability to integrate previously siloed activities or data that is causing a fundamental shift.

Importance of technologies to businesses over the next five years
(answers include somewhat important + very important)

Importance of technologies to businesses over the next 5 years - Aurecon Digital Horizon Insights 2020

Aurecon Digital insights 2020 - Importance of technologies to businesses over the next 5 years

Data is widely seen as the fundamental business asset and is improving business operations (internally and externally). It is also the enabler of other technologies such as artificial intelligence, machine learning, blockchain, energy tech and autonomous transport – which according to Aurecon’s research, are currently considered by survey respondents to be less important over the next five years compared to other technologies.

Survey respondents’ lack of attention is risky given these technologies promise to radically reshape entire industries by connecting the digital and physical built environments in completely different ways.

They will bring new challenges for business models of industry incumbents, transform value chains within these industries and force organisations to rethink the value they create. To be part of this future, organisational leaders need to properly understand the impact of these technologies and prepare their businesses now to pre-empt this change.

No matter what the technology, or when it becomes relevant, the message from our depth interviews is clear: organisations must strike a balance between technological implementation that is operational and technology that enables more effective integration with other parts of the industry.

Those with an operational only focus risk investing significant time and money into initiatives which may diminish in value or become obsolete as the economic underpinnings of their industry continue to shift.

3. Upskill to prepare your workforce of the future

According to our global research, to realise meaningful change and advance over the next two to five years, many organisations believe upskilling staff and improving and automating systems and processes will create positive shifts to enable success long-term. This insight demonstrates an understanding that refreshing knowledge and skills is critical for the longevity of organisations, and that work undertaken by humans that involves repetition is a significant risk.

Despite conventional concern about job loss associated with automation, depth interviews suggest those leading the way in the future will not be automating purely from a productivity perspective, but rather to free up people to engage in continuous learning opportunities and enable investment of saved resources in other ventures. This will become even more important as organisations create new intellectual property.

Our research also indicated that upskilling staff and building integrated networks of data and systems will be essential in order to prosper in the next two to five years and beyond. People from STEM (science, technology, engineering and mathematics) fields who have deep technical capabilities, business and digital literacy plus human cognitive, relational and social perceptiveness skills will be increasingly important in a technology-dominated future.

4. Transform business models to stay competitive

“It is not the strongest of the species that survives, nor the most intelligent; it is the one most adaptable to change.”

Charles Darwin
British naturalist

Technological advances are creating new economic paradigms which are challenging the business models and physical assets of traditional industry players. Aurecon’s research revealed there is an acute awareness that digital technologies and trends will be influential in repositioning organisations and reshaping value chains for many years to come.

Digital technologies and their integration with the physical environment are introducing new business and economic concepts that have never been on the radar. Concepts such as zero-marginal cost economics are now challenging traditional markets like never before.

The traditional definitions and categorisations of industries and organisations will likely continue to blur as value chains weaken, reshuffle and reform, and organisations shape their unique future vision to create value for customers. In many cases, this may involve continuously re-adjusting their business model and reimagining the physical assets that support it.

Organisations that can understand the implications of these economic shifts and adapt their business models accordingly will be best placed to thrive in future.

‘Digital’ driving core business outcomes

What futures do we need to prepare for?

Preparing your business and workforce is essential to thrive into the future digital landscape, but what might those futures look like? We interviewed clients from across industries, futurists, and foresight teams, to discover some fresh, bold, insights into the futures that organisations should be preparing for.

“In the future, data has been understood and embraced and used as a building block to connect sectors and prop up the shared economy. Businesses are sharing information with each other, private sector shares information with cities and consumers also share information. Data also makes possible the direct interface between information ecology – the direct connection between humans and the physical world around them.””

Stephen Yarwood,
Futurist, Australia
“Digital has changed how people interact with their environment, with shops, transport systems, and the infrastructure around them. Digital trends are going from product to an intelligent connected ecosystem which connects sectors together, so people and businesses can access everything easily, efficiently, accurately and rapidly.”

MohammadAli Baradaran,
Futurist, Iran
“We have seen a number of waves and types of technological disruption, which have impacted different sectors in different ways. Robotics automation, AI, big data and then the mixed reality universe of major reality and virtual reality... spawning new economies like, the sharing economy, the on-demand economy and the GIG economy.”

Dion Chang,
Futurist, South Africa
“5G and IoT will be the core connectivity layer that will enable us to build on artificial intelligence and machine learning. The evolution of the network will impact a gamut of industries – from transport in the form of drones, to autonomous vehicles and smart city systems, to manufacturing 2.0 with crowd robotics. Imagine a (near) future where one machine can be trained in a manufacturing facility, learn, and train all the other machines doing the same task across the world. IoT will form the backbone of smart urban infrastructure and massive data collection and insights. With the right orchestration and analytics platforms, it will continue to impact and evolve the way we work.”

Yvonne Lim,
Futurist, Singapore
“The future is always as complicated as the present. It doesn’t get simpler. Unless we reimagine, we won’t get better. I might imagine a future where the digital environment gets faster and more efficient and becomes an enabler, a backdrop, and frees people up. It might be a world where people use and think about information differently... we have moved from long document format thinking, to clusters of data, links between data and different access points for how we get information.”

Kristin Alford,
Futurist, Australia
“Digital has enabled us to re-platform our methods of communicating, storing and transacting from the physical into the digital realm. It has created connectivity, access to knowledge and given us the capacity to mobilise resources, people, assets. Those companies surviving into the future will have moved fast, operated in an ecosystem rather than behind forts and walls, they are the agile ones, that are open to new ways of working. They are porous, multifaceted and continuously deploy innovation, are willing to test and trial (Amazon, Google, Maersk) and have open mindsets to make things happen.”

Pete Williams,
Futurist, Australia

Micro-scenarios

There is no one single future. Multiple versions and divergent paths exist and technology is a key driver of change. The technologies we have today and emerging technologies over the next horizon are challenging the fundamental underpinnings of many industries.

Download our report and take a look at what's possible as we explore the potential futures of our energy, transport and property industries and the future of our digitised workforce, looking at current market trends, technological advances and insights from industry experts and futurists.

How organisations are preparing for these futures... now.

Developing the means to systematically anticipate change and organise your organisation to respond is increasingly important for any business. The following real-world examples demonstrate how a variety of organisations are preparing themselves across the key areas identified through our research, to thrive into their future.

Apply futures research to determine digital investments

Taking a strategic, long-term, systematic approach to current and future uncertainties is a priority for the Singapore Government as it strives to keep the country one step ahead. Central to achieving this is the creation of strategic guidance at the highest level of government, a dedicated foresight unit – the Centre for Strategic Futures – and a network of advisors across government which feed into the unit.

Focused on critical issues confronting policymakers today and over the next 50 years, the unit is tasked to think about future challenges and opportunities, looking for signals which indicate potential change. From increasing nationalism and populism in western politics, climate change or technologies such as artificial intelligence, its impact on jobs and the broader effect on society, this horizon scanning is critical in helping to keep the country agile and ready for the future.

Autodesk’s focus on Strategic Foresight is helping the multinational software organisation to anticipate and shape the future. With a dedicated internal strategic foresight team they are methodically looking at the future, identifying and understanding the many fragmented indicators for what may be possible, and developing ideas around how to respond.

With creative and critical thinking around challenges (such as the future of work, artificial intelligence and machine learning), Autodesk is exploring the changing nature of design and make processes and how their customers’ work will evolve over the next decade; effectively preparing them to proactively anticipate blind-spots and better understand and identify future opportunities.

Embrace and embed critical technologies

Faced with a protracted manual process to determine maintenance requirements for over 8000km of road, the City of Cape Town turned to digital approaches which reduced risk, timeframes and cost. By combining digital leadership and technology including surveying, geographic information system, machine learning, aerial photography, laser scanning and geospatial metadata, over 101,000 road segments were digitally captured, validated and tested. Through this approach, road surface area calculations were delivered accurately, confidently and in shorter timeframes compared to a manual approach, which freed up engineers to focus on designing a well-connected city.

As ID Architects in Singapore started to embrace digital approaches, including BIM, they set out a clear position for their ultimate goals and quickly realised that many other things needed to change. The most pressing was a cultural and behavioural shift to enable designers to realise this isn’t just about drafting and cannot be done in isolation.

Their clear goal from day one informed strategy and enabled meaningful impact for the organisation and broader industry. As a result, now they are working from common platforms and common tools in a truly collaborative and connected environment with many staff modelling in the same way and using consistent visualisation approaches.

Embracing world leading automation on Melbourne’s West Gate Tunnel gave the industry a glimpse into a future where 2D drawings will no longer be needed in the same capacity as in the past. With the right digital strategy, leadership, team and tools, automating design and developing a single point of truth 3D model sped up the generation of design plans, reduced communication barriers between stakeholders and improved coordination between design teams.

It also replaced the need for a fleet of people to manually input data and extract thousands of individual yet highly similar construction plans, and presented new opportunities to build capacity of those people, broadening their skills into new territory and ensuring they are ready for the future, now. In future, this digital information has an opportunity to become a client critical tool which informs their asset management program and asset investment decisions well after construction is complete.

Upskill to prepare your workforce of the future

The University of Western Australia applied automation to a number of background processes which have created benefits across admissions, human resources and finance processes. With a clear strategy, a solid understanding of what needed to be done and how they were to achieve it, the goal of retaining existing staff was also possible with these new ways of working, following investment in the necessary skills matrix and a program to upskill staff, reshaping and repurposing a number of roles to re-balance the workforce.

For Territory Generation, maintaining reliable electrical supply is essential. Keeping pace with evolving technologies – such as battery energy storage systems – ensures they maintain a competitive operational business and have the ability to supply services in the most efficient and cost-effective ways. While automation has come with some rationalisation of jobs, it has also created a more highly skilled workforce through investment in training and upskilling and could lead to more work in the future.

Transform business models to stay competitive

The energy supply industry is undergoing transformative change, and Powerlink Queensland’s network vision is strategically preparing the organisation to thrive through this transition, and for decades into the future. Underpinning the vision is the exploration of a range of possible future scenarios for the next 30 years which have enabled Powerlink to understand the services that current and future customers will value, and how the network and business will have to adjust and develop.

This systematic and future focused approach is pivotal in helping to shape the business and the network’s future and ensure Powerlink can adapt and evolve in the face of ongoing change in the global energy industry.

In the mobile payments industry, the rapid pace of digital advancements is driving unprecedented change, presenting a critical turning point for organisations to create a roadmap for their future and ensure they are well placed to thrive in this connected, digital age. With consumers increasingly demanding solutions that support their mobile lifestyles, those organisations leading the way are building their capacity to thrive by preparing their people, back-end systems and infrastructure, which power these payment services.

By embracing strategic leadership and digital ways of working, consumers and organisations are benefitting from speed, reliability and transparency. They are improving information sharing and interaction, leading to a more effective and seamless user experience, and creating new commercial opportunities.

The future is coming, are you ready to thrive?

The second wave of Our Digital Futures research shows that digitisation will catalyse great change. To flourish through this transformation and into the future, organisations must build their capacity to navigate uncertainty, anticipate change and act effectively.

These efforts need to be guided by closely monitoring the changing landscape and looking beyond technology to underlying economic, business and social implications.

The micro-scenarios explored in this report show the common threads of change that digital technologies are influencing and that organisations must adapt to, such as economic shifts, business model transformation, the changing nature of work and consumption.

This research sends a strong message that organisations must begin to reshape, repurpose and retool now, if they want to reap the long-term benefits that digital initiatives can bring.

Organisations must anticipate change through futures research to invest wisely, integrate critical tech, build their workforce of the future through upskilling and automation and create agility to transform business models.

As we traverse an increasingly complex digital future, at Aurecon we are committed to ensuring these new insights pave the way for smart digital ways of working which will bring out the best in our clients’ operations – and their people – and help them make strides for many years to come.