Innovation abounds, but will it lead to growth for AEC Giants?

A quick scan of our 41st annual Giants 300 report reveals a wealth of technology and business innovations across every major building sector and industry discipline.

Architecture firms are developing advanced tools and apps—such as HKS’s “Lab in a Bag” sensor network and Perkins+Will’s “Hazel” infrastructure modeling tool—to help improve the design process and enhance outcomes. They’re adopting emerging technologies like AR/VR and computational design at a breakneck pace, and they are tapping into the deluge of project data in new and inventive ways. They’re also reinventing continuing education with hands-on learning opportunities that take CE to the streets.

Engineering firms such as Arup, Glumac, and Thornton Tomasetti are leveraging their in-house expertise to develop products and tools for their design teams, clients, and even the competition. Some of these products, like Glumac’s G Cloud personal environmental control platform, are the first of their kind. Others, such as Thornton Tomasetti’s Hummingbird Kinetics compact mass damper, are fresh takes on time-tested technologies.

Construction firms are leveraging prefabrication, modularization, VDC, gaming, 3D laser scanning, and other progressive tools and processes to minimize risk, speed delivery, and improve quality control on projects. Case in point: Using BIM and prefabrication, Turner Construction was able to execute a complex, 20,000-sf mechanical penthouse piping fitout in a MIT research building in just four months—a third of the time it would have taken using traditional coordination methods, according to the firm.

Terms like “predictive data analytics,” “machine learning,” and “data visualization” are becoming mainstream in the AEC market. Firms are looking outside the industry for specialists in these emerging fields. They’re also beefing up their investment in and resources for in-house R&D and innovation programs, and are creating quasi think tank cultures with a startup-like vibe.   

As an industry observer, I’ve been fascinated by this transformation. But it leads me to wonder, Is the race to innovate leading to healthier bottom lines for AEC firms?

While it’s too early to tell for most firms, several companies report financial gains and new business as a direct result of R&D- and innovation-related initiatives. SmithGroupJJR’s Russ Sykes points to the firm’s more progressive culture (kicked off in 2014) as a key reason for its 15% YOY average growth rate—vs. 8% when the firm had a “conservative culture” (more at: BDCnetwork/SGJ). And, as reported last year, Little’s LaceUp mini-grant R&D program has funded more than 40 unique projects, including one—the Center for Building Performance—that is responsible for winning 14 jobs for the A/E firm.

For other firms, the investment in innovation is viewed as a new cost of doing business in the increasingly competitive and chaotic AEC marketplace.