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Welcome to the June 2017 edition of Voices on Infrastructure. This collection of articles by industry leaders and McKinsey experts builds on our previous development and financing edition published last quarter and addresses the critical phase of project delivery and execution. 

McKinsey research has pointed out the need, and opportunity, for significant improvements in construction productivity. At 13 percent of global GDP, the construction industry plays a pivotal role in securing prosperity, globally and locally, through the deployment of new infrastructure—and the need for innovative approaches to building public and private assets is stronger than ever. Improved performance in project delivery is at the core to securing increased funding and meeting the challenge of labor shortages.

The industry has seen flat to declining productivity for years, while other industries have significantly improved performance. Challenges of regulatory burdens, fragmented supply chains, inconsistent standards, and owner-contractor misalignment persist but are being tested by new models and approaches. At the same time, the need to move the least digitized industry into the digital era is clear. This transition will include using new materials, construction techniques, digital technologies such as the Internet of Things and advanced analytics, collaboration models, and software solutions to dramatically improve the outcomes of construction projects. New modes of working, including 5-D or 6-D building information modeling, open source, and cloud-based technology, are poised to comprehensively transform the way we build. And manufacturing-style, repeatable-construction techniques have the potential to transform the way we build—not only in the affordable housing and residential sectors but also across the entire industry. The world needs these solutions to be deployed faster—and companies need to make sure they will not be left behind.

We have dedicated this issue of Voices to ideas about how project delivery organizations can improve productivity. The articles describe the current challenges and feature examples of successful integrated delivery models, process standardization, collaborative contractual frameworks, proven intervention techniques, and public-private partnership delivery benefits. Our contributors look at how leading organizations are responding to these challenges with creativity and innovation. We hope you find their insights helpful in identifying better ways to deliver capital projects.

–Michael Della Rocca
Partner, McKinsey & Company

–Gernot Strube
Senior partner, McKinsey & Company

More Articles

Article

Tony Hansen, Global Infrastructure Initiative

Article

In the United States, governments are increasingly turning to public-private partnerships (P3s) to implement public infrastructure works. Here's why the benefits of P3 project delivery, not just financing, will continue to shift the market in this direction.

Michael Della Rocca, McKinsey & Company

Article

To manage costs and schedules more effectively, a four-pronged strategy can identify and limit variability in process execution.

Leigh Jasper and Karthik Venkatasubramanian, Aconex

Article

There's a monster that eats projects: scope creep. To keep the creep at bay, organizations need discipline, collaboration, and a relentless focus on real user needs.

Steffen Fuchs, McKinsey & Company

Article

Why understanding the client's view of value is critical for effective project outcomes.

Alan Krause, MWH Global (now part of Stantec)

Article

McKinsey research finds seven levers can fix construction's productivity problem, but they require a new approach from all players. We heard from industry leaders about which barriers to change are most likely to fall first.

Filipe Barbosa, Jan Mischke, and Matthew Parsons, McKinsey & Company

Article

Construction lags behind other industries in its ability to manage complex projects, but two new approaches will help close the gap.

Bruce Grewcock, Kiewit Corporation

Article

Mired by under-digitization and fragmentation, construction must find a new way to build.

Michael Marks, Katerra

Article

Major capital projects are habitually beset by overruns and delays, but three solutions offer a path out of entrenched dysfunction and to increased profitability.

Jim Banaszak, Rob Palter, and Matthew Parsons, McKinsey & Company

Videos & Podcasts

Video

Shanghai-based WinSun is pioneering 3-D printing as a construction process. With as few as three employees overseeing the process, commercially viable houses are being built in under one week, using materials from construction and industrial waste. Chairman and CEO Ma Yihe explores how large-scale 3-D printing could transform the industry with respect to design, cost, and time.

Video

McKinsey research explores the underlying reasons for the construction industry’s productivity challenges, identifying the root causes and seven actions that could create a step-change in construction productivity. With $1.6 trillion at stake, where do we start?

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