Business of Architecture
The Digitisation of Architecture as a Business - CBRE
First published on CBRE PropTech’s Blog

At the Royal Institute of British Architects (RIBA) in the United Kingdom, a survey with over 1,000 of its chartered members was conducted during the pandemic, evidencing the huge disruption of projects and the fragility of the architecture as a business:

– 79% projects delayed

– 37% projects cancelled

At the American Institute of Architects (AIA), a survey conducted with 387 architecture firm leaders suggests a deeply uncertain future for the profession:

– 67% of the firms said projects had either stopped or slowed down

– 94% anticipate revenue to dip

A large number of architect’s work are desktop-based, especially during the early design stages, ie. before the project begins on site. During the pandemic, we have seen some architecture practice’s leaders pivot to begin offering virtual consultations for small architecture projects such as home renovation and extension. As a typical extension project can take approximately six months to design and submit for planning permission, this work can be developed remotely. In the United Kingdom, we have also heard from local councils during the Real Estate Live UK event in June 2020 with Jo Negrini from Croydon Council announced that they are now working 100% virtually for pre-applications. Therefore, if there is a project in mind and the means to carry out the projects are available, now is likely a good time to start.

Low Digitisation Within the Architecture Industry

Within the architecture, engineering, construction, and property industry, the way how things work has remained unchanged for decades. In 2015, McKinsey published its Digitisation Index, highlighting the design and construction industry at the bottom of the index. Although architecture practices have been integrating Building Information Modelling (BIM), which is one of the successful digital adoptions so far, there is still a huge gap in the benefits of  technology can bring to the built environment industries.

With my background as a chartered architect, my view and experience focuses in the process from the moment a client approaches an architect for a project until the project is handed over, sometimes more for post-occupancy evaluation. Working in architecture practices of small, medium and large size, the most common way clients find the architecture practices today is still via word-of-mouth recommendation. This may work well if you and the individual who recommended the architect are carrying out similar projects – similar in project site conditions, project typology, project budget, aspired design aesthetic to name a few obvious considerations. To minimise risks, as each project is different, changing one aspect within a project should prompt an objective evaluation to ensure each appointed professional is the best for the project.

For large scale architecture projects, it is already common for clients to hold architecture competitions to objectively find the right design team to work with. What this does is provide a level playing field whereby architecture practices have the same parameters to work with, the client is able to make comparisons through the design and even price comparisons they receive. To organise an architecture competition, it is costly and hence it is typically reserved for large development projects. There are opportunities to lead new forms of process through which we design, construct, operate, and the form of organisation through which professional services within the built environment work and interact.

Digital Adoption in the Architecture Industry

For architecture practices, the largest barrier to the adoption of digital tools appears to be the cost. Firstly, investing in technology, then training to use the new piece of technology. Therefore, digital transformation adoption often stems from strong leadership to drive this change, supported with the financial commitment to adopt it.

At the core of digital adoption within the architecture industry, in my opinion, is the aim to create a competitive advantage for architecture as a business. By minimising inefficiencies in the complex workflow of architecture projects, we are able to make use of resources in the best possible way to maximuse the value delivered to clients, and also building resilience for the architecture industry.

Digital transformation is a shift in the industry-level adoption of a technology, which requires multiple direct and indirect aspects to fit together to happen. Within development projects, this is often cross-disciplinary as well which the digital transformation needs to be adopted across the board. As digital transformation involves changes in how we work, create, communicate, and deliver architectural services, the current pandemic has had an effect to accelerate digital transformation activities across industries.

In the Royal Institute of British Architects’ publication titled Client Conversations: Insights into successful project outcomes, Ian Mehrtens highlighted an existing problem which eloquently echoed my experiences in the industry and I have developed a solution currently in a minimum viable product stage towards it:

You need to spend this time to be sure that the architect really understands your intentions and vice versa so that you are able to test each other’s conception, because otherwise you find out later that you are not getting what you want and you waste time and money doing redesign.

Article by Von Chua. First published on CBRE PropTech Blog on 02/09/2020. If you have any questions or simply to chat about proptech, please do not hesitate to contact me via email at von@vonxarchitects.com