Construction is the largest industry in the world, representing 14% of global GDP, according to business consultancy McKinsey & Company. However, construction projects can be disrupted by various external factors and risk management becomes critical to protect investments. External threats to construction projects include extreme weather conditions, volatile material costs due to geopolitical issues, and health emergencies such as the COVID-19 pandemic.
Modular construction is promising as it brings many advantages from the manufacturing industry to construction projects. Most of the construction process is carried out on the factory floor, isolated from external factors such as traffic and weather.
A controlled factory environment also increases quality and reduces waste. Personnel can also be monitored more easily in a factory, which improves safety. This includes implementing coronavirus prevention measures such as social distancing.
How Modular Construction Reduces Project Delays
When modular construction is used, the majority of labor hours occur in a manufacturing facility. As a result, the amount of materials and equipment at the project site is greatly reduced. Most of the work on site consists of assembling the prefabricated modules. These procedures can be scheduled for days with favorable conditions, while prefabrication continues regardless of weather conditions.
On the other hand, when traditional construction methods are used, many activities must be suspended when the weather is unfavorable. If two construction projects are similar in scope, but one uses modular construction and the other does not, the first is less likely to experience delays.
Consider that modular construction also isolates the project from day-to-day disruptions, such as heavy traffic at the project site. Procedures involving heavy materials and equipment are also isolated from the public, which helps prevent accidents.
Improving workplace safety with modular construction
Another advantage of modular construction is bringing workers to the factory floor, where managers have more control compared to a construction site. For example, work at height is greatly reduced, as modules can be manufactured at ground level. Assembling the modules at the project site may still involve some work at height, but the time and personnel involved are reduced.
During an emergency like the coronavirus pandemic, a factory environment also simplifies the use of prevention measures. This has been a major challenge for construction managers at project sites.
- Some construction methods make social distancing impossible, especially when they involve teamwork in confined spaces.
- PPE, like face coverings, can be very uncomfortable for construction workers, especially when the weather is hot. PPE can also interfere with equipment used in some skilled trades, such as welding helmets.
- Due to the layout of construction sites, monitoring all personnel may be impractical. As a consequence, situations that increase the risk of COVID-19 infection may go unnoticed.
These problems are reduced or mitigated in a factory. Social distancing can be enabled with a suitable work layout, internal conditions can be controlled to reduce discomfort caused by PPE, and staff can be monitored more easily. Modular construction is also better suited for the use of robots in cases where social distancing is not possible. Robots can also be used for tasks such as welding, where normally required PPE interferes with PPE for coronavirus prevention.
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Adapting financing for modular construction
Modular construction offers many advantages, but one of the main barriers is finding adequate financing for construction projects. If you compare how cash flow is distributed throughout a project, there are important differences between traditional construction and modular construction:
- In traditional construction, expenses are distributed more evenly throughout the construction process. For example, if a project lasts several months, materials will typically be purchased in batches. Buying all the materials in advance requires a lot of money and storing them for a long time is risky and impractical.
- In modular construction, activities that would normally follow a sequence can be completed simultaneously. For example, modules of different floors can be manufactured at once. As a result, modular construction consumes a larger fraction of the initial project budget.
Banks and other financial institutions typically provide the funds for construction as the project is completed, rather than releasing the full loan up front. However, this must be adapted for modular construction, where initial expenses are higher than in traditional projects. With access to more financing options, modular construction would be possible in a greater number of projects.
