The green shoots of economic recovery are already visible in some sectors of the industry, but the overall revival may take time. There is an opportunity for straight-line growth, but how steep that line will be is to be seen. There is more focus on digitalization and its increased need in the aftermarket business for the infrastructure sector, which needs to adopt technologies and software that enhance productivity, efficiency and profitability. At the same time, original equipment manufacturers (OEMs) are reporting that the industry is delaying the purchase of new heavy equipment in exchange for investing in technology. In the US construction industry, there is an increase in equipment rentals, instead of long-term and more expensive commitments. This shift was evident in the first year of the pandemic and could continue through 2021.
The immediate need for increased productivity can be achieved through investments in technology, hardware and software, which can be quickly integrated into existing equipment and workflows, and can lead to quick benefits. Another advantage of these investments is that companies can operate more successfully amid the COVID-19 restrictions.
Typically, we watch what changes are occurring in the OEM market, in aftermarket sales, in hardware and software offerings, and in workflows. Looking at what customers need in order to get their work done tells us that their ability to successfully complete projects under restrictions is critical to their success.
Fortunately, the construction and agriculture industries are somewhat protected as essential services, and our position and vast portfolio means that we are also included in it. This has given us the opportunity to continue our operations through this whole period.
The digital shift
In terms of digitalization, what was generally achieved in one year is now being accomplished in one month. We are seeing a dramatic increase in the understanding within the AECO (Architecture, Engineering, Construction and Operations) industry about the value of technology and the need to adopt it to successfully navigate through these challenging times. There is a growing belief that even after the pandemic is contained, technology will continue to be critical to the success of customers who will need to be well-positioned to take on new projects and opportunities.
In the economic downturn of 2008/2009, many companies cut costs but didn’t try to re-engineer themselves to be successful. Now, we see behaviors and hear futurists predict that the companies that will survive this and move on to be successful are those that not only manage expenses but reorganize, restructure and reassess their businesses.
Takeaways from the pandemic
In the last year, we have enhanced our focus on digitalization and technology adoption based on our ability to provide efficiency, increased productivity, accuracy, safety and profitability. This requires us to work faster and more seamlessly than ever before, and in some cases with either fewer people or fewer qualified professionals who can perform at a higher level because of the availability of the technology and new tools. Therefore, machine control, the automation of various equipment and the creation of software that provides communication from the job site to the office and back will continue to be important.
“In terms of digitalization in various industries, what was generally achieved in one year is now being accomplished in one month. We are seeing a dramatic increase in the understanding within the AECO industry about the value of technology.”
Also important to us is the ability to bring more automation and technology to the industry more quickly and at price points where more customers can benefit by integrating these new products into their workflow.
We work closely with many partners. With our years of experience we have knowledge of the entire workflow within a job site. We not only understand the value of providing hardware and software for the whole workflow, but also realize that there are companies we can successfully partner with to leverage their offerings and solutions. We have found that focusing our experience in the areas of the workflow where our strengths lie and working with partners to successfully include their offerings where needed, supports our overall strategy of being an excellent resource to our clients by providing them customized solutions.
Over the course of the next few years we are looking at expanding our reach in Africa. It’s certainly a growth area with the world’s youngest and fastest growing population. We see many opportunities for the development of infrastructure-related solutions here, specifically in construction, mining and agriculture.
One of the challenges contractors face in Africa with the size of earthmoving, road construction and mining projects is the ability to measure such vast projects. Digitalization can help in overcoming that challenge. Through our partnership with Sixense Mapping, we offer a complete solution to the end-customer.
Throughout our history, we have been able to innovate through our own R&D efforts, as well as partnerships and acquisitions. For example, the acquisition of a paving software company related to logistics management has helped us further expand upon our established paving technology. We have focused equally on both strategic acquisitions and organic growth for a balanced approach to what makes sense for expanding our portfolio.
