How Can Today’s Leaders Secure the Future of Construction?

How Can Today’s Leaders Secure the Future of Construction?

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Yeah. You're listening to Autodesk's Digital Builder Podcast, the show that inspires construction professionals to innovate and use technology to improve how they build their world. I'm Eric Thomas and I've been working in construction for nearly a decade and now I have the privilege to sit down with industry trailblazers to hear how they're solving construction's biggest challenges and redefining the future of the built environment. All right. Welcome to another episode of Autodesk, The Digital Builder podcast.

I am your host, Eric Thomas. Today I am joined by John Fish, the chairman and CEO of Suffolk Construction, and Jim Lynch, the Senior Vice President and General Manager of Autodesk Construction Solutions. Today we're going to be talking about some fun and exciting topics like the state of the construction industry today, the future of construction, and how a lot of the choices that our teams and companies and larger organizations are making right now are going to have a big impact on the future and the state of our industry in, you know, ten, 15, 20 years from now. And so without further ado, gentlemen, thank you so much for joining me.

I very much appreciate it. And, Jim, I think this is your fourth time on the show. So thank you for being the reigning champ at this point.

Well, Eric, thank you for having me again I’m so happy that we're doing this here in our Boston Technology Center. So but more importantly, I am so excited to have John Fish, president and chairman of Suffolk Construction, joining us today. John and I have built a relationship the last couple of years and he is going to share some amazing, amazing insights with our audience. This is this is going to be a good one. Yeah. We're going to a fun conversation. And John, again, just thank you so much for being here today.

It's it's a real honor to have the opportunity to hear some of your perspective about the state of construction right now. Well Eric, I’d like to begin by thanking you and your organization for putting this podcast together because as you know, the more we can socialize issues of innovation and technology in our industry, it makes a huge difference because again, it brings people together in a very, very thoughtful way. And then, Jim, I want to thank you and your organization. It just it's wonderful to partner with organizations like yourself that really are trying to be transformative in a category who've had challenges over the last few years.

But there's no doubt in my mind that they say not all points of time are equal. This is a point in time that we are going to make a huge difference over the next four or five years to transform this industry. And I look forward to partnering with you on that opportunity. That's great. John. I agree.

I think the next four or five years are going to be innovative and exciting and breakthrough for the industry. And I think without having these types of conversations, it's going to slow that growth that we all really need to. So it's always a privilege. And, you know, I'm thankful that Autodesk has given us a platform like this to have these conversations. But Jim, since you are the reigning champ on Autodesk, as far as appearances, I'm going to put you on the spot first since you know, you know the routine.

So to start us off today, can you briefly describe your thoughts on the current state of the construction industry considering the global environment and everything we've seen over the last few years? Yeah, sure. Sure, Eric. let me, as you know, I spent a great deal of time traveling around the globe, meeting with our customers and really understanding their business challenges and how they see technology playing a role in helping them to to, to build better to to build, to be more productive, to be more, more safe, to be safer and to be more sustainable. You know, I in fact, I just came back from I was in Europe last week.

And, you know, the themes that continue to to to come up with the customers as I speak to them are, you know, labor shortages, the labor challenges. Everybody is talking about the labor challenges. In fact, many of the customers I talked to talk about the fact that they have strong backlogs, but in fact, they're actually turning down work because of the the lack of skilled, skilled workers. The other thing, of course, supply chains is is a is a it is a significant challenge for our global customers. So when I think of challenges, those are the two that come up repeatedly from our customers.

I will say they are all deeply, deeply invested and excited about the role that technology is playing and in fact can play to to, to to drive their businesses forward. Jim, I want to thank you for that comment. I would agree with you. I think right now as I travel the country, I was in Texas yesterday.

I was in Washington on Monday. I'm hearing this. Most contractors in the industry have a strong backlog and that doesn't surprise me because I think coming out of COVID, the federal government pumped in $6.5 trillion worth of, you know, money, especially in infrastructure.

And that has really fueled, I think, the construction climate coupled the private sector. But I think to your point, I think, you know, labor scarce labor has driven up construction. Labor cost substantially over the last two and a half to three years like I've never seen before in my life.

And I don't think it's going to subside because we have an entrenched labor shortage in our industry. In fact, in 2000, 23 of February, there was a statistic out there that we had over 500 job openings in construction and we don't have skilled labor to fill those particular openings. So to me, it's a systemic issue coupled with the fact that the federal government in Washington, where I was on Monday to talk about immigration, has not really come together to put forth a solid immigration bill to not only help solve the problems in our industry, but equally importantly, as we talked about, you know, re-engineer in the rebuilding this country. I don't see how we're going to do it if we don't come up with a proper immigration policy to allow people that want to work, come to work in, provide productivity to our category. And it's such a multilayered challenge that we're all facing right now. And I appreciate your perspective and the turning down work challenge is is a big win for contractors.

I think a lot of people don't consider in the big picture, it doesn't feel good to tell an owner that you have a great relationship with that you aren't going to bid on a project that they put out to bid simply because you don't have the resources to do it successfully. And if you do bid on that project and you are under-resourced, you're putting yourself at risk too, because you might not be able to deliver within the scope of what their expectations are, which could potentially tarnish the relationship. So it's a dance that's really challenging to have, and I really like the perspective on finding opportunities to bring people in to fill these roles. And it's a bigger conversation on educating people on what those opportunities really are. But if we don't give them the avenue to, you know, get people in those roles and in those seats and start learning about what that opportunity really is, I think we're we're behind the curve, unfortunately, right now. And there's a lot of work left to do. Which leads me to my next

question, actually, which I'd like to give to you, John. And so think about an ideal world where all of the common blockers to change or magically remove. So we're in this fortunate space now where we've identified all these challenges and we've managed to mitigate most of them, and we're empowered to really rapidly improve how we build over the next decade.

So with that in mind, can you tell me about your ideal vision for what construction would look like in ten years from now? Yeah. Erika Thank you for that question. I will. I think I've got to go back before I go forward. I take a look back in the 1930s when they built the Empire State Building. I don't think people realized that building was built in 13 months. And today, if somebody asked to schedule that building out, it would probably take at least four, if not 5 to 6 years to build it today.

And that has to prod a question of why. And yes, I understand regulation. Yes, I understand safety rules and various other types of things. But fundamentally, our business has become functionally dysfunctional at the end of the day.

Siloed, disconnected. And I think that is gone because risk mitigation entered into the industry really in a significant way in the forties and fifties. And we do see them not at risk. And all of a sudden I think you introduced silos or the architect worked directly for the client.

The client work for the contractor and all in a contract for the Arctic and all of a sudden you started seeing those relationships become more and more distant as opposed to less aligned. And so to me, we have to move forward in today's day and age of realigning the built world. And to me, what that means is how do we carry alignment of interests between the architect, the developer, and the contractor? And to me, I think that's the ultimate challenge we're dealing with right now. And so our vision going forward is to answer your questions specifically what we call a Vision 2025. How do we integrate the built world into a seamless platform? How do we deliver architectural services in partnership with the architectural community? Let the Arctic community do the cartoons and create the vocabulary and the program for the building.

But can we take the responsibility of doing construction documents in complete those drawings? Can we take on maybe even getting involved in the capital stack? We have what is called Suffolk Capital. Can we invest in the stack of the capital stack to have alignment of interest with the developer? So again, everybody is looking out for each other's back. The other Duracell perform, I really believe in this market going forward.

The sell perform. What has gotten away from most GSEs is coming back into the market. How do we minimize intermediaries to lower the cost of doing business and having much more control over that process as a whole? And lastly, property management.

How do we provide skill sets and also instructional capabilities for the people that are building, the building that know best to the owners are to transferring over. But the last comment I would make is part of that built platform is this So what's the tool or toolbox that's going to allow us to accomplish that? And that is single handedly two things. One, technology and data and the tools in that box today for us, we're going to be in two years from now are going to change quite rapidly. Secondly, if you can't measure it, you're not going to be able to manage it.

And to me, data is the gold of construction going forward. And I say this very humbly to you, we invested probably six or seven years ago the creation of a clean data lake. We have 29 data analysts in our organization. And what they do, they crunch data each and every day.

Now, we've been very retrospective in the use of our data. But what I would say on a going forward basis would be much more prospective, which is important to us. And what we have to get over is data is a weapon in. If it's used in the incorrect manner, it can cause problems in our industry overall, we see it in a no fault culture environment.

The data can be absolutely in many ways a panacea to the future in construction. I'm so excited about where we're at with the data conversation and I'm encouraged by what you've shared here. I don't know if I've spoken to anybody who has that many on staff focus exclusively on data, and it's a huge forward looking consideration because what we see most typically with regards to construction data is exactly what you said as far as it's a retrospective. We've captured these things. Let's step back and think about how we can analyze it, to put it into a dashboard that might be useful for our company.

But I think the organizations that are really looking at what do we want to understand? Because those questions should and absolutely have to inform our dashboard choices in the data capturing in the processes. Because if we do not, then it's always going to be that retrospective and you're not getting your just in time decision making. It's always something that's in aggregate.

And so I'm encouraged by it. And Jim, I've heard you talk about this as well. Yeah. I mean, Suffolk is absolutely a leader. And as I again, you know, as I look at our customers around the globe, you know, the size of his team that is really focused on data and data analytics, it's super impressive.

And, you know, to me, I think of it as the idea of, you know, the data that is there. How do you turn that data into information? And I think Suffolk is doing a great job with that. What we need to do as technologists are make sure that we're providing the tools that help you, you know, pull those deep insights, those key learnings to help you predict issues on future projects before you're out on the job site. It starts with data. It really starts with data.

And that's, you know, that's what John and his team are doing, building that data base, if you will. And what we're trying to do is come up, you know, alongside as a partner and say, okay, we've got some machine learning capabilities, some A.I. capabilities that can put that data to work and to help you drive better outcomes.

And I think we're in a very fortunate moment in time right now where we can be having these conversations and in doing so with intent. And and I want to be fair, it's it's an overwhelming problem if your data standards and your data housekeeping haven't been up to par, especially if you're a large organization, making large changes quickly brings in introduces risk into a business. But I always advise people when we talk about these data conversations is pick one area and start making those improvements there.

Prove to your team that there's a purpose for this and why. And then you get to start iterating and maybe six, ten, 12, 14 months down the line. Now you get to start applying that in a more broad way and then suddenly you're able to think across your business instead of from project to project. And so it kind of changes the conversation. But I agree it's it's that that crux right now where we we you know but the key in the law can turn it and you know where we go right maybe be just a comment if you don't mind. Is it you know, it's interesting how you point that out.

Six months we started this journey out and I call it the data journey. We started this probably about seven or eight years ago. And it's been a very substantial investment. And as a privately held company, knowing that R&D is not a big thing in the construction category because margins are compressed overall. But I've been greatly fortunate and I say that very humbly, that I can invest those dollars into a strategy that I think can transform the way we build our buildings going forward. And so I'm excited about it.

But the second point I would like to make is it it's a cultural shift to and if data is presented, especially to field operations in a way that seems like it's Big Brother watching you, okay and hold you accountable, it's the exact antithesis of what you really want. You have to go out there and explain to people how this is making their life easier, more productive, and really, at the end of the day, how they can spend more time at home with their family. Yeah, the communication there, I think, is the key, too, because nobody likes to have somebody come in and go, This is how you're doing this now, especially with tradespeople who have been doing something for 30 years, the same way in everything does need to change over time and we can introduce that.

But it's the methods that you take to introduce that change that I think are indicative of success or maybe slow failure in the long run. It's a it's a big challenge. But John, you actually lead into my my next question very nicely. So what has changed the most from your perspective in construction in the last 5 to 10 years? I think the introduction of technology, obviously, you know, you know, VTC, artificial intelligence in some respects and I think really what we're seeing really the early, early days of how our industry can actually be transformed without being intimidating.

And to me, our category, you know, is one of the last categories of all categories to be innovative, work down with hunting and fishing and agriculture, which is a little bit of embarrassment. But I think the day has come. We're realizing that the cost is greater than the value created. It's a very, very important concept and we haven't hit that for a long period Now that we have coming out of Post Cove and all the escalation that we realized. So if we don't leverage technology, we don't have that cultural change or that cultural shift. If we don't explain to our category as a whole that we need to reinvent ourselves, I feel somebody else is going to do it.

And that will be technology companies at the end of the day. So to me, this is an opportunity We're having these type of podcasts and people not looking like they're competing with each other, but more importantly, Eric collaborating with each other because there's no single bullet that's going to solve this issue in our industry. It's going to be a collaborative effort.

We've got to come together as a team and people have to go in what I call my company, a no fault culture. Don't be afraid to make a mistake because we will make many but will happen at the end of the day. We'll come out at the other end stronger, more aligned and more collaborative. I mean, there's so much to to to comment on there that it's first of all, that, you know, that this this idea that learned from your it's okay to fail if you learn something from feeling that's a good thing. I used to have a boss that used to say fail fast forward you know fail, fail fast, but then move forward, learn from it and put those mistakes to use. It's it's it's really interesting.

You know, if I look at construction over the last five years, by the way, five years ago, I used to always quote the McKinsey study that talked about, you know, construction only being better than hunting and fishing. I don't talk about that anymore because I don't think it's true anymore. Listen, we're still in our infancy.

We still have a long way to go as an industry to adopt technology. But, you know, the hunger is there. As you know, Eric, I was part of Autodesk when we acquired Revit. When we rolled out the concept of BIM, when we drove the concept of BIM across the industry. And I can tell you that the speed at which our construction customers today are interested and embracing technology is much faster than we saw from the design community back in the early 2000s. There was that move slow.

It took us a while to get the concept of building information modeling to really take off, look at construction today and look at the use. Just look at our usage, the usage of our tools by our customers. I mean, it is exponential growth. Honestly, it's really impressive to see. And that is because the understanding that there is a great opportunity to be had by embracing these tools. So it's great to see.

But I loved what John said about coming together and working together, and I'm going to tie it back to the data conversation because I've spoken to some in the industry that, you know, when we talk about our machine learning capabilities, they're like, Hey, I don't want you training your algorithms with my my information, my data. And even if you explain that, listen, it's anonymized. Nobody knows that, you know, where, where, how we're learning about, you know, what a leakage issues by your data but we're anonymizing it so that you can benefit from it and others can as well.

And there is this there's a lot of a lot of companies that will stand back and stand off on that. But I think there's a huge opportunity for the industry to come together. And when when it does and I'm optimistic and confident that it will, it will really leapfrog from where we are today. I agree with yeah.

I think we're also benefiting from a moment where the technology is so much easier to use than it was historically. I mean, when I stepped into construction a little over a decade ago, there really wasn't anything purpose built in. So with that changing and perspective changing, I think people are a lot more accepting of, okay, there's change, but there's a reason for it. And we're getting better at qualifying it because if you if you don't qualify it well that first time, it's very hard to change that perspective, that perspective.

The second time when you bring something new in and they go, Oh, I got burned by that dashboard because it wasn't accurate, or I got burned by that tool because it didn't work the way it was supposed to. And, you know, ten years later, there's still, you know, hesitant. And as we build those relationships and build the trust internally, I think that's when we start to change minds.

And, you know, you find your champions and you build on the success as. But, Jim, your thoughts here actually kind of lead into the next question for me. And so I'm curious, what do you think over the last 5 to 10 years has not changed, but probably should have? What has not changed? Well, you know, John talked about you have project structures, right? This this design build, build this, the relationships. Honestly, I know I remember when we built our built out our office that that was in Waltham, Massachusetts a little bit ways up the road here it was an IPD project integrated project delivery and you know what I was a part of that when I witnessed that. I was like, This is it. This is where the industry is going.

This is when those walls between developers own developers, designers, contractors, this is when those walls come tumbling down. And here we are, you know, 15 years later and the walls are not broken down. I really expected to see an explosion in IPD. And it it hasn't happened.

So that to me is the biggest thing that hasn't happened. And I'm not I'm not I could go on the technology fast, but that to me is the biggest thing that hasn't happened. I'm cautiously optimistic about that conversation, though, because I am hearing more positive reception to it. And I understand some of the hesitation at times because it feels weird when you have been working in the same contract types for so many years to suddenly say, okay, subcontractors and other organizations that I've been in JVs or work directly with, I'm going to lift the curtain now and you get to see all the things that feels a little strange. But as you get to message that and communicate it and you show that there is an aura, why there's incentive here to step back and say, you're going to benefit from this, I'm going to benefit from this and our owners are going to benefit from this.

I think you get to move forward there, but you also have to have to have an owner that goes okay, that seems like a good idea as well. And if not everybody is interested in stepping up to the table, there's going to be some hesitancy, to put it politely. Yeah. So, John, I'm also curious, what else do you think we need to change today in the next 5 to 10 years to create that runway, to achieve that vision that you were talking about a few minutes ago? Yeah, I agree wholeheartedly with Jim about alignment and breaking the barriers down. I think we've already spoken about that IDP, We've done a few of the IDP projects.

I would say they've been relatively successful. The challenges when you introduce IDP from the contractors point of view, you really look at it from a risk point of view and it's very difficult to sort of assign risk categories when you do an IDPs. And so to me, we're not against an ADP. We are really sort of working towards integrating the built world into a seamless platform where again, we let the client move forward, the design allow us to take on some design responsibilities, any degree you want us to.

At the end of the day, we also talk about completion guarantees, which is a big thing. That is construction completion guarantees. In my also I sense also putting skin in the game. So the more that we can integrate the built world like it was way back when, I think the more advantageous we're going to be. The second thing, which is probably more important than all the above is our category has had an outmigration of labor over the last 5 to 10 years. We've also had a tremendous amount of people retire right and early, especially after COVID people are 50 years old, did not want to come back to work.

Understandably so. It's a very, very tough business. So to me, developing a strategy to introduce a new labor flow into the industry, and that is vocational schools, which I'm a big, big supporter of, we got rid of those back in the nineties and 2000s. And to me it was one of the biggest mistakes America made. But to me, how do we offer first generation students a pathway into construction? And more importantly than just first generation women in construction to me, I think women in construction a singlehandedly probably the biggest asset on a going forward basis.

And to me you could leverage that particular category because at the end of the day, there's a category that is typically is not really been representative in our industry. We are fortunate to have 28% women in our country and our company. What we're expecting we call rebuild ratio over the next ten years. We're going to be going from 28 to 38. And how we're going to be doing that is we're going back to the high schools now in places like the Girl Scouts.

We have an arrangement in alignment with the Girl Scouts. We invest in the Girl Scouts. We bring them to our offices. We explain them some of the things we're currently doing, and we gain a sense of interest and they all of a sudden start thinking about a sense of purpose at the end of the day, because they never thought about this particular category. So to me, I think we have to re-engineer the workforce coupled with the idea of what I call upskill training.

Okay, how do we take the younger generation and bring that into the business and teach the old generation like reverse mentoring, not to be embarrassed that you can ask a stupid question of a 24 year old, but that 24 year old is going to give the technological capabilities and skill sets and address your curiosities. But then again, the other side of it, you're going to help them with experience and I call them exchange currency at the end of the day. And if you look at things from a dollars and cents point of view, that's a pretty good bet to take. I've been hearing this more often as far as the very deliberate pairing of people who are just coming out of school or vocational or some of the trades with those more experienced people, because exactly what you said, that relationship is so powerful and it's an incredibly important relationship to build. Right now because in ten years, many of those people will not be working in construction anymore. And if we don't capture that knowledge and retain it with all the talent that we have today, that is stepping into the leadership roles of tomorrow, we're going to have a big problem because the technology layer, which I'm going to ask a couple questions about in a minute, I'm excited about that too.

But the technology later can only do so much. And we have to really empower our people and ensure that they have the perspective that's appropriate and necessary from people who have been building for ten, 20, 30, 50, hundreds of years in a way that has changed some, but also has not changed a bunch. And so there's a lot of information that they need to have in the brand.

One comment I'd like to make about that, and it's an analytic and it's, you know, a little funny, but again, it's real people that are over 55 years old or 60 with respect to technology. Why do the why do they have curiosity regarding technology? It is not because of their job or vocation, it's because of grandkids. That is a single purpose.

Why people over 55 years old migrate towards technology. And so to me, that being the case, how do we make that experience much more comfortable for that very seasoned construction vet and not feel insecure about asking? Again, I'll repeat myself a 24 year old, a question that they otherwise would not want to ask and I think that's a culture conversation as well. Yeah, it's a great point. And you know, Eric, you'll remember this when we acquired Planned Grid four years ago and remember, he corrected me earlier, it was four years ago. You know, they used to have a saying at play on grid.

You know, and it was to make the technology work for the fat fingers on the job site. And no disrespect there, but the fact that, you know, these are guys typically guys with gloves on or, you know, big hands and my hands and like how do you make let's make sure everything we do works for the for the fat fingers. And and I think they did that. And that is something while we don't say it in those terms today, we spend a lot of we put a lot of emphasis on how do you make sure you make it easy and you keep it intuitive because the more capabilities you add, the easier it is to, you know, just completely get lost in the technology. But I did want to go back to something John talked about, you know, getting kids, you know, why they're young and getting them engaged and interested in our industry.

Because as to John's point, the vocational schools, which, you know, I come from a family of six, youngest of six, very blue collar. I didn't go to vocational school. I did have family members that did, you know, worked for the TI. And, you know, it's a shame that we as a society kind of let that go. But, you know, just as John is engaging with the Girl Scouts, which is phenomenal, Eric, you know, about our efforts with women in construction, that's that continues to be incredibly important to us as a as a company.

But also getting the we have a program here in Boston, in fact, that we've partnered with Suffolk on. We call Make It Real, where we focus on inner city kids to get them engaged in construction. You know, we did shot some videos at a couple of Suffolk sites and talked to some of the Suffolk team members. And, you know, those are the things that that's the responsibility I think we have as technologists and as industry thought leaders and successful business leaders in this industry. That's the responsibility we have to get more young, the next generation interested in this industry.

So sorry I took us back to that. But it's such a it's such an important point. And if we don't fix that, we're going to be having a very different discussion in ten years. Jim, just one comment, Derek, not to delay this conversation with this part of the conversation as we think about sort of our overall strategy for United States of America. And we talk about on shoring and re-engineering our country, if you move forward the way the strategy currently exists today, it's never going to happen. The end of the day in our category, which I'm very, very proud of, built this country on the backs of the construction trades.

We're going to rebuild this country on the backs of the construction trades. What better sense of pride in ownership of being America's contracted to be involved in that conversation? And so to me, I look at this as an opportunity of a lifetime. How do we embrace what's going on in Washington and the direction they're going right now to basically rebuild America? And probably the most important thing of the rebuilding to me is it's for the next generation. It's not my generation anymore. It's about the next generation. And that's really how we look at things on a going forward basis.

How do we be the sort of standard bearers of the next generation, not our generation? And when we have the right framing and perception, I think it starts to become easier because you can have this open and honest conversations. I appreciated your point of not enough women in construction, specifically in our approach to women in construction, to me is very refreshing because there's there's a bit of a performative way to talk about women in construction. I go, it's Women and Construction Week and we're going to talk about it today.

And then we're not going to talk about it anymore. But you need to flip that over this. This is amazing. People who are doing cool and amazing work who happen to be women. And if we're not tapping that portion of the workforce, we're leaving half of our potential employee base on the floor and we just go, Nope, we're not going to include them in that conversation.

And that's just foolhardy because the perception and the perspectives that you get when you're inclusive in this way brings so much to the businesses that if we're not doing this well, we're going to fail in. And it's also just it's a real human, empathetic conversation that we need to have that not everybody is unfortunately, thinking about in the appropriate framing. So I appreciate both of you for, you know, toeing the line and having sometimes uncomfortable conversations because the ones that if we don't have them, nobody's going to be having them. So I'm going to park that because if we could go down that rabbit hole for a bit, it's a very it's a heavy jobs lead. But I look at you know, but I appreciate you being so honest and open about it because not everybody is comfortable saying these are the challenges and this is why and this is what we need to do and we need to have this conversation.

And I'm going to have you both back and let's let's talk about just that and how we could be better there, because I think we can have another hour long conversation about that. Absolutely. Yeah. But let's let's then back to technology for a little bit. And the last time that we connected, John, you shared some thoughts on artificial intelligence and some other technology that you're very excited about in the impact that it's going to have on that future vision of construction that we were talking about a little bit more. So can you reiterate and tell me more about what types of tech are building methods? Although I think we might have covered built building methods already are we going to have to embrace to achieve that ten year vision that we're talking about? You know, it's interesting as a sort of take a step back from a, you know, holistic point of view and look at construction as a whole.

I think about back, you know, after 2009, we had the Great Recession. We had to sort of improve our category and we introduced technology basically BTC beam and various other types of solutions to the digital space. Then we moved on from there to data. And data became a big conversation in 2020 ten, 2015, people started using data. I'm not saying ubiquitously, but I'm saying some of the contractors have made investments there and they found it helpful. And as you often say, if you can't measure it, you cannot measure, manage it, then all of a sudden the concept of machine learning, you take a look at the agricultural business, running machinery on the on the open farmlands, how that's improved overall efficiency at the end of the day.

And now what I think is really a huge breakthrough, I think it's the biggest issue since the introduction of the Internet, artificial intelligence. Now we've been playing around the edges of artificial intelligence. You know, in things like the metrics of safety, which we use, which is very good open space, which is a wonderful solution out there that we invested in. I feel very good about that.

We have a technology investment group called Suffolk Technologies. That's one of the ones we're very, very proud of. Then also you have things like Spot the dog that we use on some of our dogs run around the country. But the sense to me to have the ability to leverage artificial intelligence I think is a once in a lifetime opportunity.

And let me sort of pare down on two specific areas. First, because you're going to be if you don't boil the ocean with this particular solution, and that is on the design side, as they often say, and I'm looking over here right now, this little thing that says Nasser Nasser does not design their rockets with beam. They use artificial intelligence. Elon Musk's designs his cars at Tesla using artificial intelligence. Why do we use beam or VDS? VTC over and over again to design the same type of details when now the advent of artificial intelligence is going to cause that dynamic to change radically? Secondly, in addition to design, which I think is the most impactful area of construction, is scheduling.

We walk on a job sites today, we think we know exactly what is the most sort of thoughtful way to approach the sequencing of that particular job. What if I was to tell you that we're doing it all wrong? What if I was to tell you before up down construction that that would never, never happen? All of a sudden, we introduce up down construction. We've done many times around the country we're saving say the dirt work is going to take a 12 months to get up to grade. We can get there in six months. Now, it's an opportunity for all of us as a category to open our aperture and say to ourselves what is possible. And I think artificial intelligence is the first time that we'll have that conversation.

And what I would say in a passion about this, we need to have this conversation as an industry, not in silos. It's too big of issue one that needs to be governance around it, which I really feel strongly about. At the end of the day, be careful what you wish for. And secondly, I think the opportunities to really create value along the full sort of spectrum of construction, I mean, is absolutely incredible and it really brings a deep breath of enthusiasm to what we do each and every day. So, you know, I love that. I mean, John, you and I, we had lunch a month or so ago and we talked about A.I.

and we talked about, again, across the full spectrum. But you look at design, I mean, at some point in time, the industry and those observing got this idea that, you know, kind of every building has to be unique. And of course, we don't want every building to be a bunch of square boxes, of course. But, you know, there is so much data and so much to learn from. And that is what artificial intelligence feeds off of. And that's how it delivers.

That's how it delivers value. I mean, honestly, in ten years from now, maybe less, I think less, you know, do we need to have design tools that that allow design teams to draw doors, walls and windows? Or do we do we apply artificial intelligence to capture the requirements? What are you trying to achieve? Capture the conditions and get the design team and the construction team now integrated further along so that they're, you know, tweaking and then from there quickly generating again, using AI in key learnings, quickly generating those construction drawings so that, you know, we're not having teams labor for weeks, for months over creating those. So there's so much out there for us to apply artificial intelligence to.

It certainly starts with the data going back to our previous conversations. Jim, let me just give you an example. As I said, you know, Suffolk Technologies is a group that we run that invests in contact solutions around the country. It's sort of like a Y Combinator of construction. Yeah. And there's a group out there called Firms and Firms is a solution that uses artificial intelligence to do document review. And as opposed to taking two or three weeks to do a sort of a complete set of document review of a project, it'll do that in two days.

Now it's not 100% accurate as we sit here today. But my sense is the concept, the strategy is right and to me, how do we sort of take the handcuffs off of traditional ways of doing things and put on the gloves of using artificial intelligence? We're partner with a firm right now over in India having these conversations. Well, people don't realize here because we're very properly in that it states we always do it right.

Well, I'm going to tell you some, other parts of the world right now are light years ahead of us. And I use the word and curiosity not being afraid to ask the questions that we, you know, need to be asking to move and increase productivity and our overall category. And it's interesting because I think part of the part of the the the mentality I think that gets in the way is, you know, is this new technology going to take jobs away? Am I going to lose my job if I apply this technology? Now, it's an interesting question in construction to ask. Given our previous construct. I discussion about about the job, the labor availability.

But I think it's the same thing with robotics, right? People say robotics in construction that's going to impact my job or it's going to take away jobs from other workers. It's not. We have a shortage. What I believe is robotics on the job site could actually, you know, robotics assist on the job site. And we have customers that are doing some amazing things in Japan with robots on the job site, assisting construction teams, getting the materials, doing the heavy lifting.

You know, those things aren't taking away jobs. They're actually saving workers backs. And so, you know, it just we just need to get away from this this mentality that a I, you know, machine learning robotics are going to negatively impact the job market that they want. I think you just I think we're close right now, though, thankfully. But I would also say this is it a sort of take a step back and I look at it from a macro point of view. If we don't take our country as a whole is going to be in trouble in the next ten to 15 to 20 years.

Definitely. When you think about our population at 330 million people, India just approached 1,450,000,000. And today and as we all know, 70% of GDP is consumption. And if we can't grow our population, then we can't increase our productivity.

And the only way to do this, if we can grow our population only at a very, very modest rate, is increase our productivity through technology and innovation. And so to me, you know, if we're going to take our GDP from 25 trillion up to 27, 28, 29, 30 and be the number one economy in the world, we have no choice but to innovate and we can't be insecure about taking away jobs at the end of the day. So this is a much bigger conversation.

And again, it comes back to Eric. To your point, how do we sit around the table and have this conversation? And it's not about Suffolk, it's not about Autodesk. It's about us thinking about our country, our economy, our future state of America, and being part of the solution.

We may not get it right, but at least we have that conversation about trying to do the right thing in all these different technologies we're talking about. It's an augmentation conversation today, and I feel more people are starting to see that. When Spot started showing up on project sites, people got a bit freaked out or they go, Oh, we're going to 3D print buildings. Skeptics here. On if that's going to be feasible or not. But everything we look back in now, we say, okay, we have this massive gap in labor availability right now.

We have a lot of advanced technology that is starting to become more and more ubiquitous in the construction industry at large. And when we can merge those two situations, suddenly we're empowered to take away the the dangerous jobs that people have. We have an opportunity to make sure that people go home at five instead of 9 p.m. and also start to fill some of those gaps that we haven't had the opportunity to.

So it's not a it's not a take away. The job might change. Now you're doing something a bit differently in your augmenting. It or instead of doing material takeoffs for two and a half weeks, you do it for an hour and a half at the end of the project when you say, okay, here's all of the things that I looked at. Now let's make sure it's right versus by hand for 19 years. And so part of that is perception conversation.

I think as far as we start informing and educating people back to the partnership relationship, you're talking about earlier where you have our our younger generation who is a bit more savvy for the capabilities and comfortable using it and bringing that conversation to some of the more traditional tradespeople and saying, Hey, look, you shouldn't be afraid of this. Let me show you how this helps you do your job. And also, you might not hurt yourself when you're doing your job because this thing is going to take away that portion. You know, you get to retire comfortably instead of being, you know, a little bit more injured or a little bit more tired at the end of a, you know, your very impressive career. So, John, I know we were talking about this here. And I think what we were just talking about leads into it.

But when we did last speak and what we were talking about earlier, we do need to pivot from our very heavily white collar driven recruiting and sourcing for tech for labor in today's market in that focus is going to pivot and trend to recruiting more traditional blue collar roles. As you were alluding to before. Can you tell me a little bit more about why you feel that is? I think the industry quite away from the pure bricks and mortar sort of say of what it really stands for? I think we tried to white collar guys, okay, a category that really is proudly a blue collar category.

And to me it's all of a sudden we're finding out we got these experienced superintendents on the job sites retiring and we're fundamentally not able to backfill those particular individuals. And we've almost had an awakening as a category, as an industry. And so to me, reopening these vocational schools, which is fundamentally important, we're doing that in the northeast part of the country now, which I'm very, very proud of. And also, I think the idea of providing training to these first generation students Now, we used to recruit our young classic kids come in 75, 100 kids every single year that kids kids, young men and women. And we would go to liberal arts schools because I always thought about the idea of critical thinking. I thought that was good. I have an open mind.

How do things differently? What we're finding out is that the critical thinkers don't want to stay in our category and ones that do do very, very well. But the ones that don't move on to the financial services or other type of categories. So to me, going after these kids biotech, especially first gen that see construction as an opportunity to live the American dream, and I often say I don't hear people talking about that that often. But you talk to some of these first gen men and women that have come here that living in an environment that they truly want to live, that American dream and feel proud of what they're doing and want to be in the construction business, those are the people that we're looking for right now. Eric, What I would say to you is Suffolk, we're not the right company for everybody to work for.

We have very, very core values. We discovered them. It took us 24 years to discover and we didn't define them. Okay? And we really, really care deeply about our people, deeply about our people. And we want people to feel far out of the family. But at the end of the day, we have to work hard.

We have to show up every single day with the produce. We have to demonstrate to our clients that we make a commitment to them that they can go to bed at night knowing that we're going to deliver. And that's the kind of organization that retains their talent. You mentioned the the increase in self perform that you're starting to see across the country, and I think that's going to continue to be more common.

There's a I think, a risk mitigation that comes with that for the business because they control more of the trades and the labor pool that's coming in. But I've seen both sides of this where a company well, I've worked at companies where they had more self performers, how they retain them when the projects were ending and they might not have had new ones to fill, but they were going to be there because they trusted them. And then they went back to that next project. I've seen the other side where the project ends in their two weeks and you go, What happened to the project? I'm sorry, we're going to lay you off.

And I know that there's a balance there and there's a lot that goes with it. But in this kind of economy, in this kind of labor situation, especially when you're drawing people that are younger than myself, if you don't have an organization where people are going to be confident that you're there for them, they're going to go work somewhere else. In Eric Holder, I'd say to that, I think, see, that's the benefit of scale.

I think people that have been Arabs for a period of time understand it's a revenue game. At the end of the day because of low margins. And I'm just being very candid when I say that.

And, you know, we as a company, you know, we do five one half to $6 billion a year and we have about 100 jobs going on and throughout the country. And so having that core labor force that, you know, because we can't perform every single job. But the idea is to put our best foot forward to try to be competitive and control the different aspects of the project, give as much more predictability at the end of day. But I do think to your point, you're going to see the industry moving much more back in favor of self perform at the end of the day and increase quality, increase consistency, predictability. And at the end of the day, probably most importantly, lower cost. And so just looking back to the tail end of this conversation we're having right here, what advice would you offer other leaders that are out there listening to help them recruit more blue collar talent, but more importantly successfully train them to embrace these technologies, especially if they're unfamiliar once they've been hired? Yeah, I mean, I think there's a couple of things is, of course, as you know, our customers around the globe are investing in the technology, but it can't stop there.

You have to invest in the employees to make sure that they have the skills, the technology skills to apply that technology to the job site. And by the way, they should also be leaning on their technology providers. I believe we have we have an onus we have a responsibility to make sure our customers, you know, it doesn't stop when they buy the tool by the technology. It actually that's just the beginning. You know, it's making sure that we're there helping their teams on the job site embrace the tools and technologies.

But I think it's you know, I think there's there's the training part. But I also think there's the you know, I think firms like like Suffolk, right. They're able to attract great talent because they they paint a picture of what the future can be.

And I think that's so important that, you know, that we're all painting a picture, an exciting picture of what the future can be, because that will motivate kids coming out of school to to want to learn construction, to want to embrace the technology. So, I mean, I think it just it can't stop at the technology investment. It has to go well, well beyond that. We have to set everybody up to be successful. And I think you're absolutely right. The the onus isn't simply on the contractor that is doing the hiring.

And it's not only on the technology provider. There's a relationship that's built there, but you have to make sure that when people are coming in, you're finding ways to train them that's equitable and fair and helps them understand the tools, especially if they're coming from a background that isn't traditionally tech savvy. So there's there's a lot to consider. John, I'd love to hear your thoughts on that topic.

Interesting topic. It's very, very near and dear to me. Eric And I say this, you know, with full disclosure and transparency, I'm a severe dyslexic. I didn't learn to read until they ninth grade. I can't spell to pass third grade and you can never read my handwriting in. From a practical point of view, I should have been a laborer.

Somebody helped me learn to read, to write, to gain a sense of confidence as myself. I was always a very good athlete. And what I learned through that and as I entered in the construction space is that when you think about construction, there's a shortage of training overall in our category. And again, it's siloed in how do we recognize the fact that every dollar spent in training and construction you get a tenfold return.

The average of training dollars in another category like financial services, it's a2x return because people in our industry, a lot of them do, of learning differences to be with. And by providing that training, all of a sudden the ROI is substantial. There's no ROIC in training than in our construction category. Furthermore, what we've done is we have again, we strategically plan, as Jim pointed out, coming in where as we start now ramping up to 20 4k, we've come up with this program called T 24 training 24 in what it is to take a holistic review of our entire training program and how do we focus on what we call upskilling our people, not providing them a skills. Let's take an assessment of where they are at this particular point.

I'm the career agnostic of what their ages, but just understand what their capabilities are and where they're short because I believe everybody wants to do the right thing. Sometimes it just unwilling to ask for the training. And so if we can put together a program of upskilling in our organization across the entire platform, both the functional side and the operational side, and then measure that with a sense of clarity, watch the needle move on our training, you're going to see you're going to see a corresponding improvement and a Y in the organization. There is no doubt in my mind about that. And ultimately our goal is as a company and again, I say this and I use this where we for humility, we want to be the best the best training program in the country as a contractor. And so to me, I think to eye of responsibility have being a severe dyslexic with a learning difference that wants to take a leadership role and explain to people it's okay to ask that stupid question because you know what? You're going to get a thoughtful response.

You're going to get a pat on the back. I appreciate your candor here, because the position that you're in is is insightful for it, because people out there who do have differences need that role model to say, I see myself in this role and it's harder to qualify that to somebody if they don't see somebody who is like them in doing something that they aspire to do. And so your forthcoming this with that perspective, I think has tremendous value for people out there listening where if you put in the work and you find the right path in organizations are equitable in how they bring people into their team, I think the opportunities are there.

But it also, as you alluded to, it steps further the training conversation that we're having now. I feel like we're getting much better as an industry and I know we're doing some stuff with an X these days, which I'm appreciative of with just Pollack's team ahead on the podcast a few months ago. But if we're not thinking through all of the different learning approaches, we're doing our teams a disservice because not everybody learns in a two hour sit down training session that they never get to go back to and see again.

Some people want a two minute session just to learn about the one thing that they can't remember how to do today, something they might not do every six months, every ten, every 12 months. And if we're not giving them the right the opportunity to hone in there, we're not setting up our systems to empower that. We're setting ourselves up for failure, unfortunately. And so when we do segment our training to be more equitable and meet all these different opportunities in different ways and perspectives and learning and everything else, I think, one, it allows people to go back and find that information much more easily than they would have. But also it allows people who might not have been successful in the ranks of your organization to, you know, step forward because they can find the information that they need.

And Eric, I just want to echo, you know, John, your transparency is, you know, both inspiring and motivational to folks like Eric said that that may say, okay, you know, I've can I do that? And I think it's it's, you know, thank you for sharing you very much. And, you know, again, as I said before, I'm really honored to be here and having this conversation. I feel very lucky. The feeling is very mutual. John.

So I've got one more question for both of you. Jim, I've asked this question of you a few times, so I'm going to kick it your direction first. And it's one that I ask every, every guest.

And it's one of my favorites because the the answer is re

2023-06-07 15:39

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