The construction industry hasn’t changed in centuries and is ultimately still laying bricks and building buildings. Construction giant Stefanutti Stocks has not only been able to transform the face of its IT department as an early adopter of the cloud but has also managed to face work from home disruptions without missing a beat, thanks to the migration of its cloud environment from Europe to South Africa.
Stefanutti Stocks is a major listed player in the South African and Sub-Saharan African construction market. It employs 7,500 people and earns billions in annual revenue with projects running from Cape Town to Dubai. Its sheer scale and the geographically dispersed needs of its on-site teams, which run hundreds of projects simultaneously, have been the catalyst for transforming its IT team’s role to that of a service provider.
“Our IT group acts like a service provider, or a reseller, providing different services for around 16 companies and 200 to 300 projects at any given point,” says Kevin Wilson, general manager of group IT services at Stefanutti. “So, we have to be agile and efficient and ensure access to systems no matter where the construction crew lands.”
In 2015, Stefanutti took the stance that a private but offsite cloud would aid its approach. A long-time user of VMware, it migrated to a vCloud Air solution hosted in datacentres in Europe. The move let it port legacy applications without significant expense and conduct a virtual lift-and-shift migration into the cloud to deploy more modern cloud services and enable other technology services. However, latency issues required Stefanutti’s investment in network acceleration equipment and the establishment of its own interconnect sites (one of the first in South Africa).
According to Wilson, the pressure was mounting for IT to provide faster application performance but maintain the construction industry’s reputation for being gun-shy with technology investment. This led to an investigation into local certified VMware cloud provider partners that would offer the same VMware experience at an improved cost, had the skills to support the company, and provide the flexibility to manage, operate and innovate in its environment. It was at this point it selected VMware Cloud Verified and Principal Partner, Routed.
Wilson says: “We wanted a partner that could emulate what we had (in the cloud), take ownership of our cloud architecture and get on with it. I don’t want to build my own cloud architecture, nor do I want to know-how providers will keep my environment up and running. I want it to work. As a long-term user of VMware, both on-premises and in the cloud, I know that it is the best solution for this approach because, ultimately, your application doesn’t know where it is. It’s highly available, properly backed up, and lives in the cloud.”
Crucially, the complete and certified VMware stack at Routed delivered a more reliable and predictable migration. And Routed’s full-stack VMware Cloud Director enabled features Stefanutti needed for its IT-as-a-Service approach, such as a complete self-service experience using the UI and APIs. As expected, the move to local vastly reduced Stefanutti’s latency issues, led to much lower costs and afforded it the flexibility needed to run services for hundreds of projects in different locations.
“Stefanutti are such a unique client. While they are a construction business at heart, they are also, in theory, a cloud service provider where IT provides services to the business on-demand,” says Andrew Cruise, MD of Routed. “Our teams work exceptionally well together and are technically in sync at any given point. They always looked for a partner that could support their journey and not just push services at them. So, by providing Stefanutti with full self-service access and control with support and aggregating our knowledge when they need it – we make a great team.”
Stefanutti and Routed the seamless and speedy completion of a lift-and-shift of legacy systems from one cloud environment to another. This included the migration of all the companies “moving parts” and third party applications and software such as Veeam. It was also all up and running by the time the pandemic forced a more remote working model – which Wilson adds had no real impact on access to systems as it was a model the business was already comfortable using.
He says: “Our industry hasn’t changed in centuries. We are still laying bricks and building buildings. Many of our systems are older, as are the applications we use, because change is slow in this industry. Looking ahead, we are tinkering with new systems and solutions and hoping to build applications that support our IT-as-a-Service model. At Stefanutti, we rip out 60% of our networks every year because projects conclude, and sites change. This needs a high degree of agility, reinforced by 4IR elements, a capacity we have been building for years on VMware environments.”
Click here to read how the construction industry need to self-disrupt or self-destruct.
Meanwhile, at RIB CCS’ recent #FutureNow conference, the Change Management Institute’s Ket Patel said the construction industry needs to self-disrupt or self-destruct.
“While running a construction company prior to the Covid-19 pandemic may have been difficult, doing so when the pandemic hit was nearly impossible.”
He said while other industries battled to create digital versions of their physical selves, the construction trade had to take a hard look at what to do, especially as it was somewhat behind the curve, technologically and digitally speaking.
“At the centre of designing a stronger and more resilient industry is technology. Technology and digital adoption have always been an organisational imperative. It is not about saving money. It is all about remaining sustainable and being able to weather oncoming storms.”
Core to being able to adopt new technology is the ability to embrace change, which requires motivation (really wanting to change), capacity (creating the time and space for change) and support (change is a team effort). If one of these does not exist, change will not be affected.
Patel said that while the industry has acknowledged that change is necessary and technology is part of the answer, realistically speaking, without individuals who are motivated to drive change and to collaborate and coordinate with each other to affect the necessary actions, it will take a long time for the change to be embedded.”
RIB CCS CEO Andrew Skudder said the construction industry has faced – and continues to face – several challenges, including lagging productivity growth; low profit with high risk; slow innovation and digitalisation; low customer satisfaction; and regular time and budget overruns.
“It is evident – from the persistency of these challenges – that the industry requires transformation,” he said. “Fortunately, there are solutions to these challenges and emerging disruptors fall into two main categories: firstly, industrialisation, which refers to things such as modularisation, prefabrication, product standardisation and automation; and secondly, digitalisation, which covers aspects such as cloud computing, mobile technology, building information modelling (BIM), artificial intelligence, augmented reality, data analytics and integrated platforms.”
Skudder said digital transformation should transcend merely converting from analogue to digital (digitisation) or using technology to simplify work processes (digitalisation).
“It should be about digital transformation by connecting people, processes and data for a more collaborative, efficient, productive and sustainable industry.”
He highlighted five pillars that underpin successful digital transformation. These include digital leadership supported by senior management; having a clear digital roadmap; introducing sustainable training systems aimed at nurturing a digital culture in the organisation; ensuring the process is enterprise-wide rather than project-based; and making sure the process to drive digital change is inclusive.
“Inclusivity can be promoted through workshops and virtual labs or deep-dive experiences before the digital journey commences. Importantly, this enables team members (leaders and subject matters experts) to come together to explore the product, articulate the digital roadmap and define the future for the business,” noted Skudder.
Change Corp CEO Lindsay Agness said a key factor in these challenges is people find it difficult to change habits and culture. “One of the biggest reasons is that habits are not easy to change. Another relates to neuroscience – known as ‘current moment bias’ – where any reward in the future needs to feel much bigger than the reward the individual is currently getting.”
She said helping to guide employees through the initial perceived losses related to change requires being clear about what is in and what is out, explaining why change is necessary and ‘what’s in it for me’, respecting the losses, expecting over-reaction and showing empathy, identifying key stakeholder groups, repeating information and engaging constantly. “Communication is the superpower of the change manager.”
This ‘loss’ phase is usually followed by an exploration phase. “This is where you want your people to become curious,” said Agness. “You want them to develop a growth mindset, which is all about curiosity, learning and being willing to practice – and sometimes not get things right.”
“Finally, you want to get people on your bus. This means identifying, coaching, empowering and rewarding the people who support the change, and counselling, supporting and monitoring those who don’t support it.”
Sylvain Lamy, vice president of commercial synergy at Schneider Electric, pointed to statistics indicating that about 40% of the world’s CO2 emissions are from buildings, 90% of project builds experience time overruns, 30% of construction cost is rework and 170 million tons of materials go to waste every year. This means change is non-negotiable if the planet is going to limit the rise of the global temperature to 1.5°C set by the 2015 Paris climate agreement.
“We need to move the vision from people adapting to buildings, to creating smart buildings or autonomous buildings that automatically adapt to the new age of infrastructure,” he said. “This presents a massive opportunity to change the way we build and reduce the negative impacts of this industry.
“Challenges need to be resolved around how buildings are operated and maintained on the one hand and designed and built on the other hand. The former relates largely to how buildings are heated and cooled (which probably contributes to about 70% of the sustainability issue) and the latter relates to being able to track carbon emissions throughout the design and build phase using digital technology.
“While there are many challenges ahead for the industry, the good news is that technology is a key enabler of transformation. Low-cost cloud computing, mobile technology, IoT, machine learning and artificial intelligence allow for integration and access to smart information, providing the industry with the tools it needs to tackle the challenges it faces.”