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Why Saudi Arabia’s future must be built on digital foundations

Digitization and next generation technologies will transform Saudi Arabia’s construction sector into a more dynamic, efficient, cost effective and creative one as it leaves behind traditional construction practices.
To ensure the success and sustainable growth, the Kingdom’s huge construction sector must fully embrace digitization. This shift has become a necessity as Saudi Arabia embarks on its journey to deliver the ambitious Vision 2030. It will see extensive housing and infrastructure developments as well as huge giga-projects such as the multi-billion dollar Neom Future City, the US$16 billion Red Sea Development Project, and US$6.5 billion Qiddiya entertainment city. All these developments are set to transform the kingdom’s economy.
These giga-projects realize the importance of digital technologies to plan, design, build and eventually operate upon completion and are already employing them. The Red Sea Development Project, as an example, employs Building Information Modelling (BIM) in the design of their assets, cloud technology to allow seamless collaboration with their ecosystem, and modular construction to reduce the environmental impact on their pristine sites. The wealth of information generated in design will serve as part of their Smart Destination initiative that will provide visitors with a unique digital experience throughout their stay. The benefits are clear to project owners: architects and engineers can design unique structures that are of the highest quality while being cost effective and construction companies can deliver such projects faster, more efficiently and safer.
It does not take being a developer of a giga project to realize the tangible benefits of digitization. When the Covid-19 pandemic hit, Dubai-based engineering firm Al Gurg Consultants employed digitization to ensure employee safety, without impacting continuity of operations and productivity. This was made possible by shifting many of their paper-based processes to digital only and although the firm is currently still transitioning to a cloud-based workflow, the changes made allowed more than 90% of staff to work from home.
It was a similar story with Hassan Allam Holding, an engineering and construction group in Egypt, who had to switch to a remote working model which required staff be given access to a wide range of business applications and online meetings tools. The company expanded digitisation through BIM, internet of things (IoT), virtual and augmented reality, and business information online dashboards. This allowed the organization to maintain a high level of performance and improve collaboration across its subsidiaries and some external stakeholders.
With rising excitement about trends such as industrialized construction, Artificial Intelligence, and digital twins, powered by BIM, cloud and better computing, it is crucial to keep focus on the human factor of change management. Technology has become the easiest aspect of a digital transformation while processes and workforce upskilling need to be an area of attention. A workforce should fully understand why change is happening and understand the importance of adopting new processes rather than fitting a new technology to an old process.
A recent MEED qualitative survey of 50 GCC construction professionals in the first quarter of 2021 found 58 percent of those polled saying digital transformation would have the biggest impact on overall project management and performance, while 29 per cent felt that the most benefits would be seen in speed of delivery, accuracy and collaboration.
According to MEED’s Digital Awakening: The digitalisation of construction in the Middle East May 2021 report, Saudi Arabia, makes up 45 percent of the construction market in the GCC and Egypt. The Kingdom has around US$1,137bn of construction and transport projects planned or underway, including a US$298bn pipeline of future projects. The scale of such developments mean the Kingdom will be the key driving force to push the regional construction sector into digitization. The study also found that Cloud computing is now a close second to BIM in terms of investments made to adopt the technology into construction companies in the GCC and Egypt. These firms are now increasingly using subscription-based software as a service model rather than installing and maintaining their own software. This in combination with data capture and data visualization as well as drone technology is also becoming increasingly common in Saudi Arabia.
The construction sector was already well on the path to digitization even before the Covid-19 pandemic, but this process has now been accelerated with remote working, collaboration, streamlining operation and automation becoming more important. The MEED report found industry respondents felt digital transformation technologies were particularly effective in the site execution (56%), design development (52%) and operations and management (38%) phases of a project.
Governments and policy makers can help nurture this growth through mandates and incentives that encourage the digitization of construction projects. The UK remains a great example of establishing a better construction sector driven by a BIM mandate that took effect progressively and allowed the sector to see the benefit.
Low oil prices in 2014-15 have created challenging economic conditions with spending on projects cut. We have since seen different approaches in the sector: some companies were reluctant to invest in technology, processes and people while others saw it an opportunity to be ready for the next wave of growth. When COVID happened, the companies that invested proved to be more resilient and were much better at business continuity while their workforce remained safe.
As we exit the pandemic, the focus turns again to growth. With the Kingdom having announced ambitious projects with aggressive deadlines, the project owners such as the Red Sea Development Company are well aware of the benefits of being digital and innovative and have set up accordingly. This effect will trickle down the ecosystem leading the Saudi construction sector to transform and deliver grander, more resilient and less wasteful projects to realize the ambitions of the country’s leadership.

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