Digital hesitance: 72% construction SMEs still rely solely on paper for operations

Organisations in the construction industry are falling behind in terms of digital adoption, which could be negatively impacting their bottom line, according to new research by GAIN LINE.

The survey asked 1,000 senior managers/directors and those heading up procurement, HR and ops teams at SMEs in ‘traditional’ industries — energy, life sciences, manufacturing, rail and construction — about the use of and attitudes towards digital services/tools within the business.

The construction industry had an overwhelmingly high percentage (72%) of organisations still primarily using paper services, compared to just 17% of energy organisations, 19% life science, 18% manufacturing and 15% rail. The other industries primarily used a combination of digital and paper services.

GAIN LINE helps firms grow by digitally optimising their operations for improved efficiency and has growing concerns that reluctance to go digital within the sector could be negatively impacting organisations. As well as impacting efficiency and profitability, lack of digital adoption is also setting construction firms up for issues in the near future with government initiatives such as Making Tax Digital requiring businesses to file their tax returns online.

Despite hesitancy, 55% of the construction respondents whose organisations were still relying solely on paper, or a combination of digital and paper, believed that ditching the paper and going fully digital would save them time and 26% thought it would save them both time and money.

However, when asked what the main barriers to going digital were, construction industry respondents cited:

• Lack of digital skills within leadership and employees (74%)
• Resistance from leadership (64%)
• Lack of budget (33%)
• No time or budget to train staff (30%)

“Many SME construction businesses see potential benefits of going digital,” says Jonathan Ward from GAIN LINE. “However, lack of digital skills and resistance from leadership can make it difficult to put plans in motion. Going digital can save firms huge figures in both time and money.”

Of the SMEs across all five sectors that have gone fully digital, 58% said that doing so saved them money, improved morale (56%) and 52% even said it increased revenue.

Jonathan continued, “There are lots of options for construction businesses to help them go digital including hiring digital apprentices, sending employees on training courses, applying for digital grants and seeking help from a digital transformation specialist such as GAIN LINE.”