The revival of Construction Industry post Covid-19


Hello readers! And welcome back to the blog which talks about construction industry and impact on it due to COVID 19. In our previous part of this blog we understood about why construction industry is so much impacted due to this COVID 19 and we have also evaluated its impact. In this part we will talk about what kind of reviving steps or ideas one can take to revive their construction business. Before we start one thing we understand that each of the company is different, their situation and culture is also different so solution will also be different. However, we tried to capture some reviving solutions which will be useful to most of the companies.

Why impact on construction industry is very critical?

Before we jump on the solution let us all understand why impact on construction industry is so critical and why we desperately in need of reviving those who are impacted.

How to plan revival of industry

Reprioritize Projects (Quick fix to overcome current challenges)

When planning to resume the operations below are the quick fixation pointers which should be consider allowing smooth transitioning the operation. While resuming manpower and capital can be expected to be in short supply and therefore there needs to be a framework in place to reprioritize projects over a 30-45 days window considering below parameters

Every long term companies should also focus on the projects like repair and renovation. This focus will help companies to infuse short term cash flows which can be useful for completing the long terms projects. This repair and rework market will boost due to instability of spending power in the economy by end user.

Revisit project definition and delivery strategy (Mid-way strategy)

Once the company has open their functions, many unpredicted situations will arise, so to tackle such situations and to able to sustain below are some mid-way strategies which company can adopt. In a time-bound manner, project owners should chalk out a plan to minimize the impact of COVID-19 and ensure viability and sustenance of projects going forward in a changed environment. Below is a ten-point assessment framework, project owners can use to assist with this:

Project definition: 

-Revisit strategic alignment of the project, plan phasing, de-scoping


-Optimize engineering, layouts with a focus on target value design

Plant and Machinery

-Review availability and mobilization of Plant & Machinery and operators

-Serviceability of equipment due to disruptions

Construction technology

-Explore off-site, modular construction technologies to optimize time and resources while enabling controlled working environment for Labour


-Review front availability on account of lockdown

-Re-draw schedule based on revised engineering, procurement, resourcing strategies and weather impact


-Review Labour availability (given migration and crop harvesting season will alter available pools of skilled/un/semi-skilled)

-Anticipate crew sizing and revisions in productivity norms

Budget and cash flow

-Review budget availability & contingency utilization

-Financial impact of lockdown

-Outstanding & anticipated delayed client payments

-Ad-hoc vendor/contractor mobilization advance requirements

-Enhanced costs of health and safety norms


-Explore deploying mutual risk and reward sharing contracting options (e.g. integrated project delivery model (IPDM)

-Revisit milestone versus running account billing contracting options to facilitate contractor cash flows


-Revisit project management processes to remove inefficiencies, promptly identify and remove external stakeholder interface bottlenecks.


-Undertake procurement optimization (alternate sourcing, re-packaging, re-bidding)


Build resilience (Sustainability strategy)

Resilience is an ability to recover quickly after being hurt. This feature is now very important for companies to build to keep ready for the future negative business scenario where a company will able to revive. So building a capability to be resilient becomes very necessary for the company.

Building resilience is a long term strategy to adopt. When we talked earlier it was short term fixation to revive from this situation. However, if a company wants to regain position in the market these are the long term strategies one should consider.

Based on a learnings from the experience of the COVID-19 crisis, to better protect the construction projects in the future below approach should be considered.

Strengthen contractual provisions 

Post COVID-19, the construction sector could consider the introduction of new clauses in future contracts to set out clear guidelines for action and relief in extreme possibilities, and to minimize disputes that may arise at such a time

Why technology is essential

In the above part of a blog we all talked about how we can revive the industry. In all those brainstorming majority we talked about to increase the productivity, strengthening governance and leveraging business. To adapt more to frequent changing market. One of the major component to work on this solution is incorporating technology in the business operation. Not only just technology but smart and decision making technology.

We all are aware about that construction industry is not one of the pro technology industry, we have still ways to work manually and we have accepted that way of working. But as we talk coming future, technology is key to success. Also across the world people has started working on technology in construction industry. So in our next and last part of this blog we will talk about current prevailing technology which are and will help construction industry to grow better and faster.

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Jaysheel Buch, is Chartered Accountant working in the field of working as a Strategic Business Consultant covering small to large organization across India. Apart from financial consulting his key work areas are Financial modeling and Analytics. Numbers are his playground, where he plays with them in such a way that they seems super easy. Apart from finance, he has also worked in Operational as well as Strategic areas and benchmarking for the clients organization.

About J.hirani: J.hirani is a Strategic Transformation team which works as a growth partner for different organisations in various industries by providing services like Agile transformation, Scenario mapping, Strategic alignment, Balance scorecard, Digital transformation, Incubating new ventures, Operation excellence and Aligning human capital.

©J.hirani, The revival of Construction industry post Covid-19, July 2020. All rights reserved

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