< Previous18 MASTER BUILDERS JOURNAL #122 Cover Feature T he sudden hit of the pandemic is a situation none could have predicted and many businesses are ill-prepared for. Faced with a prolonged situation that disrupts business operations and ways of conducting day-to-day business activities, many business owners have woken up to the fact that change is necessary, not only to survive this difficult period but also to prepare themselves for the imminent change that has already begun to take place within the industry’s operational infrastructure. To some degree, the adoption of digitalisation within the industry has been accelerated as a result, as businesses navigate challenges and embrace the necessary adaptations in their business and operational processes to prevent the spread of COVID-19 among their employees and to society. Remote work arrangements, virtual communication methods and the setting up and maintenance of a central system for obtaining, gathering and dissemination of information are a few examples that also serve as preventive measures to curb the spread of COVID-19. MBJ interviews four individuals from different segments of the construction industry who share safety measures, risk management plans, insights glimpsed from the pandemic and more. Faced with unprecedented challenges brought about by the COVID-19 pandemic, the construction industry has been evolving since its onslaught. How do businesses fare, what changes have taken place over the last year or so and what else can be done to support and grow the industry?19 MASTER BUILDERS JOURNAL #122 The COVID-19 pandemic has affected all of us for the past two years. How has your company managed so far? Lyu En, Managing Director, China State Construction Engineering (M) Sdn Bhd: The pandemic has had a significant impact on the operations and production of our company. We have attempted to do a number of things. In order to cope with the pandemic, we have established a regular working mechanism for pandemic prevention. Our company has set up a leading group for pandemic prevention and control and arranged for fixed pandemic prevention liaison officers and specialists for our projects. Also, the company has taken the lead in conducting monthly pandemic prevention inspections at project sites. In addition, we ensure sufficient reserves of pandemic prevention materials (that can meet our use for more than three months), such as medical masks, protective clothing, medical gloves and shoe covers as well as alcohol and chlorine-containing disinfectant, etc. We have stockpiled 20 kinds of Chinese and Western medicines, finger oxygen meters, blood pressure meters, oxygen machines, etc., for COVID-19 prevention and treatment of patients with mild symptoms plus six months’ worth of rapid diagnostic kits for antigen and antibody detection. We have strictly complied with the required SOPs by the government in order to resume work and production. Our projects are managed in as closed an environment as possible. Entering and exiting personnel and vehicles are subject to SOPs which include the taking of body temperature, disinfection and registration. Two rounds of disinfection are conducted at job sites in the mornings and evenings. We also practice closed-grid management of the operation and living areas, prohibiting mobility between them. Employees in the office area work separately from the on-ground staff while managers work from home. An emergency plan for the treatment of critically ill patients with COVID-19 is also in place and emergency drills are conducted periodically. Isolation rooms are prepared in case of confirmed and suspected patients. In addition, our Lexis project site uses the ‘Smart Construction Site’ system to monitor the conditions of personnel, objects and materials in real time while the Jesselton Twin Towers project site has its own contact-free disinfection area. All these measures have been recognised by the local authorities. To take care of the physical and mental health of our staff and actively fulfil our social responsibilities, the company has adopted one-to-one talks, holiday sympathy, health lectures and guaranteed salary payments to retain employees and reduce the risk of staff turnover. At the moment, everyone is maintaining a relatively healthy and stable psychological state. In addition, the company joined hands with the local communities to fight the pandemic by donating 150,000 masks, hand sanitisers, protective clothing, and medical kits to the local communities. The pandemic has brought about losses and difficulties which include: — Relatively high pressure of pandemic prevention and control. In the long run, the pandemic is difficult to control effectively. The spread of mutated viruses is fast and the rate of critical illness is high. Also, the local medical system is overloaded, the physical and mental health of the employees are tested. — Reduced work performance, tight work schedule and cash flow, higher project costs including direct expenses for disease prevention, indirect losses for work suspensions, increased raw material prices and labour, project delays and other issues. Since the outbreak of the pandemic in March 2020, the government has officially requested a complete shutdown for a cumulative period of more than five months. Work capacity has also been reduced to only 60 - 70%, which has brought huge losses. — Staff rotation difficulties due to the impact caused by the entry and exit of personnel. Visa applications for expatriates and personnel in Malaysia are becoming increasingly difficult to obtain and there are no replacements for key positions at the frontline. Philippe Neveu, Regional Sales Manager, Dextra Manufacturing: Dextra has, very early in 2020, implemented strict sanitary measures for both its employees and external parties (visitors and suppliers) as per local regulations. To mitigate the risk within the workplace, an internal control process has been established, such as installing a face recognition device at the entrance for body temperature measurement and security control. Internal procedures were put in place to manage COVID-19 infection at the workplace, which include: — Communicating regularly with all employees through our internal network, TV screen in the office and factory, group phone chat, intranet with infographic posters to remind staff of preventive measures and other COVID-19-related topics. — Ensuring business continuity while implementing alternate shift work in the office to increase social distancing and mitigate risks by reducing the number of people working in the office at any one time. — Taking charge of staff vaccination registration in order to reach herd immunity of 80% before the end of September. Christian Swift. Operations Director, Plus Three Consultants (M) Sdn Bhd: Our business tends to be countercyclical, so the COVID-19 pandemic has had little impact on our company as our core service is to support clients during these unprecedented times – when construction projects are delayed or cancelled with associated payment and claims issues. Our dedicated staff have been available throughout the pandemic to help our clients deal with the effects on their projects to minimise risks and disputes and achieve amicable settlement. In these exceptional times, the safety and wellbeing of our employees and their families has been the highest Cover Feature20 MASTER BUILDERS JOURNAL #122 “The pandemic has reinforced the importance of good record-keeping and communication at project level and we encourage our clients to talk to all stakeholders to avoid protracted disputes.” Cover Feature priority for Plus 3. Since the start of the outbreak, we have continued to monitor the evolving COVID-19 situation and have ensured strict compliance to the government’s SOPs. We strongly believe in the value of family, including our employees, their families and the wider community and through the strength of working as one family and supporting one another, we have maintained a safe and healthy environment. Despite the easing of restrictions in certain sectors, we continue to encourage our employees to work from home and avoid unnecessary risk and exposure to the virus. For those wishing to return to the office, we have implemented strict SOPs, including: staff rotation, fortnightly self-tests, regular office sanitising, social distancing and mask wearing, proper workplace ventilation and limiting face- to-face meetings with clients. Tom Karemacher, Vice President Asia Pacific, Procore Technologies: 2020 was defined by the COVID-19 pandemic, the recession, the social justice movement, and humanitarian crises – many of which continued in 2021. It has been a time of discovery, resilience, and unity at Procore. We have adjusted to having a largely remote workforce, helping one another, our communities and the construction industry. We continue living our values of openness, ownership, and optimism. The construction industry was hit hard by COVID-19. Our company found new ways to support and partner with the industry, helping many of our customers adapt their businesses to the unforeseen circumstances resulting from COVID-19. Our rapid responses to COVID-19 included: — Giving select customers free access to our platform and support so they could quickly deliver emergency relief projects. — Making virtual collaboration easier with new video conferencing integrations and an embedded digital whiteboard application. — Introducing COVID-19 inspection templates on the Procore platform to help customers’ offices and job sites adhere to rapidly changing mandates coming from various authorities. These templates were especially appreciated by small and medium-sized general contractors, who typically don’t have dedicated safety staff creating and implementing standard templates. We’ve had feedback that these templates are big time-savers. — Bringing customers together virtually to share best practices for coping with COVID-19. — Helping people find work through our global construction job board. — Putting our data to good use by creating a Construction Activity Index that quantifies COVID-19’s impact. We tracked and shared week-over-week worker-hour insights, regional breakdowns, and more. Procore has continued its hyper growth trajectory during this period. In 2020, our revenue was up 38% year-on-year to US$400 million, and we added 20% more customers. Today, Procore has over 11,000 customers and over 300 partner integrations. We took Procore public on the New York Stock Exchange in May 2021 — it was a celebration of the construction industry. COVID-19 and remote work have accelerated digitisation, and we’re confident that, as the construction industry recovers in the months and years ahead, more companies will transform themselves digitally. Now that we have experienced this type of event, how do you plan for the future in terms of risk management? Lyu En: Maintain good market order – work with the local government departments and industry associations to resist vicious competition and other acts that disrupt the order of the industry. We pay more attention to the reasonable price space of the projects to be undertaken and avoid projects where the bid price falls below the cost of development. We are also working towards strengthening our cooperation with local enterprises to leverage our respective strengths while sharing risks by complementing the strengths of local enterprises. We will leverage the technical, managerial, and financial advantages of our company and combine them with the cost advantages of local enterprises, jointly contributing to the healthy development and technological innovation of the Malaysian construction industry. Next, is to consider an appropriate increase in the proportion of our own means of production. The various phases of the movement control order have extended our project duration. During that period, the cost of our own means of production in the form of own purchases did not increase Lyu En, Managing Director, China State Construction Engineering (M) Sdn Bhd21 MASTER BUILDERS JOURNAL #122 Cover Feature improve our IT systems and cloud- based platforms to maintain access to documents remotely in a safe and secure environment. Assist our clients in the risk management process, particularly at the tender stage. Tom Karemacher : We look at risk management through a series of ‘Ps’ (people, place, process and partner) and ultimately, we are advancing Procore’s vision of improving the lives of everyone in construction. As a people-centric company, the first ‘P’ is taking good care of our people, and it is the people that drive a company forward. This means a corporate culture steeped in diversity, inclusion, and belonging. Next is place; the places in which we operate must be the safest and most conducive possible, to bring out the best in our people. Business continuity planning is an ongoing process. Much of what we provide for our customers is process-driven. Clear, comprehensive and transparent processes foster productivity and mitigate risks. Finally, helping to drive both process and product are our partners, and in this we include everyone we work with – customers, technology partners, suppliers, industry collaborators, etc. We continue to listen to and stay close to our partners, so that our solutions meet the evolving needs of the construction industry. What are the main lessons learned from this COVID-19 pandemic? Lyu En: Pandemics can bring social disasters. Governments in different countries will take different approaches to deal with them according to their own realities. The most important thing is to rely on the enterprises themselves and individuals, because even the best policies need to be implemented by people. Every coin has two sides. The pandemic has dealt a heavy blow to the enterprises that do not operate well or attempt to maliciously disrupt the market through low-price competition. However, there is an old Chinese saying that myriad woods in spring are growing beyond this ailing tree. We believe that companies that have survived the pandemic will have a more developed ability to resist risk, a deeper understanding of the local market, and a stronger ability to look ahead and discriminate in the future so that they can better grasp opportunities and achieve further development. Philippe Neveu: When the pandemic began, it necessitated a global effort to ensure that everyone practiced behaviours to keep themselves as well as others healthy and safe. This included the widespread wearing of masks indoors and outside. While vaccines are powerful tools for preventing significantly, the rental loss was greater for rented means of production used during the pandemic. The cumulative rental cost over a complete project cycle was even higher than the purchase price. Lastly, is to pay more attention to changes in the price of raw materials. It is desirable to fix material prices during periods of low material prices to ensure that the overall cost of the project is manageable. Philippe Neveu: We are keeping our Dextra Group Outbreak Management Procedure up-to-date according to the current situation. We will continue to strictly implement our sanitary measures in the workplace and insure our employees with a local medical cover for COVID-19. The most important issue we have been facing at present is the procurement and distribution of appropriate vaccines in an adequate and timely manner. We are now planning a new vaccination process with the corporate hospital for all employees in 2022. Christian Swift: Adapt to the realities of the new normal in remote working and virtual meetings where possible to ensure the health and well-being of our employees. Adapt the office set-up to improve working space and ventilation. Continue to Philippe Neveu, Regional Sales Manager, Dextra Manufacturing Christian Swift. Operations Director, Plus Three Consultants (M) Sdn Bhd Tom Karemacher, Vice President Asia Pacific, Procore Technologies22 MASTER BUILDERS JOURNAL #122 Cover Feature disease, the pandemic has demonstrated that individual behaviour impact the wellness of the group and that we are, more than ever, inter-connected. We also learned that it is possible to be resilient individually and as a group in a crisis. Christian Swift: The pandemic has reinforced the importance of good record-keeping and communication at project level and we encourage our clients to talk to all stakeholders to avoid protracted disputes. The pandemic has affected us all in different ways and we should work together to come out of the other side stronger with lessons learned and new approaches. Tom Karemacher : The construction industry, which is the second least digitised industry in the world, is realising that in an increasingly competitive and challenging market, leveraging data differentiates those who win with those who lose. During this pandemic, digital tools have become essential for teams looking to maintain their productivity while maintaining physical distancing. Digital platforms can augment, or even entirely replace, a variety of daily tasks that traditionally do not adhere to physical distancing procedures. They can completely reshape toolbox talks, health and safety screenings, and the delivery of documents from the field to the back-office. We believe COVID-19 is a tailwind to the industry’s movement to digitise. Our customers have relied on us more as the industry sought efficiencies. Last year, we had over 300 million photos, documents and inspections created on our platform, up over 50% year-on-year. In 2020, we deployed over 300 product updates and new features on the Procore platform. We have grown our product offering from 4 products in 2017 to 13 products today. In your opinion, how can MBAM do better in assisting its members? Lyu En: MBAM could continuously expand its social influence and voice in the industry. It can act as a think tank for the government and provide constructive advice or suggestions to the relevant departments of the construction industry or the government to promote the development of the construction industry and the local economy. For the overall interest of the Malaysian construction industry, MBAM could obtain full understanding of the development status of member companies, and the main difficulties and challenges they are facing. And then, it could organise some internal activities to promote understanding and cooperation between members. In order to establish and maintain good industry order, MBAM could help develop a set of market access mechanisms. Malicious construction contractors who disrupt the market should be included in the industry blacklist to prevent bad money from driving out the good, in order to maintain the healthy development of the local construction industry. Philippe Neveu: We see the role of MBAM as a driver for improving the governance of each stakeholder in the construction field to act responsibly towards other parties while providing a platform where members can learn from each other and share their experience. A proactive attitude is necessary. Christian Swift: MBAM has been very supportive to its members through this very turbulent period, providing regular updates on the Malaysian construction industry, the COVID-19 pandemic, training courses and the various directives made by the government. This has been extremely helpful and a great source of information when trying to establish a timeline of events and I would like to see this continue during the endemic-COVID era. What can the government do better to help the industry during these challenging times? Lyu En: Vigorously promote the development of the construction industry. The construction industry is one of the mainstays of Malaysia’s economy. It is constantly upgrading the local urban landscape, providing modern transport and housing for the people, a large number of jobs and laying a good foundation for Malaysia’s economic development. Of course, the future development of Malaysia’s economy is still dependent on the government’s good use of market economy and macro-control. Next is to clarify how to bear the losses caused by the pandemic. During the pandemic, the Malaysian construction industry was hit hard and most of the losses are now borne by construction contractors, who are in urgent need of government support and assistance. Thirdly, open visa applications or renewals for construction personnel. Both local low-end foreign labour and high-end skilled management staff are scarce in Malaysia and foreign human resources are indispensable. However, due to the tightening of immigration policies, the scarcity and high labour costs of local foreign labour are not conducive to the performance of projects under construction and the long-term development of the construction industry. Philippe Neveu: This is the difficult question here. I think all government efforts should lean towards limiting the economic disruption by adopting a policy that provides stability to business owners. On a more holistic approach, we should aim to promote ‘back-to-normal life and activity’ rather than live in an everlasting fear of illness. Christian Swift: Increase government spending in infrastructure, including healthcare facilities, allow construction projects to recommence to improve the economy and boost employment, provide financial support to clients and contractors who have suffered financially from delayed or cancelled projects and reduce red- tape approvals/certification processes required from multiple agencies.23 MASTER BUILDERS JOURNAL #122 Special Feature IR 4.0 and its Future in the Construction Industry The Industrial Revolution (IR) 4.0 – has it gone beyond being just a catchphrase in the Malaysian construction industry or are changes already afoot? What are the viewpoints of industry stakeholders pertaining to its impact or benefits to the construction industry? MBJ sought feedback from a few industry stakeholders. How do you foresee the Industrial Revolution 4.0 (IR 4.0) impacting the Malaysian construction industry in the near future? Lyu En, Managing Director, China State Construction Engineering (M) Sdn Bhd: Smart construction is an inevitable trend for the future development of the construction industry. It can effectively reduce the dependence on human resources such as foreign labour and reduce material waste in construction projects. In addition, as a large number of materials are prefabricated in factories, project durations and costs can be effectively controlled. Wei Han Lim, Sales Manager (Malaysia, Singapore, and Brunei), Dextra Manufacturing: We foresee that IR 4.0 in the Malaysian construction industry will enhance productivity and quality of work which in turn will improve overall performance of projects. In addition to this, IR 4.0 also helps to ensure high standards of safety and health. This helps prevent accidents and diseases at construction sites while encouraging a more sustainable approach to reduce the overall environmental impact of the construction sector. Christian Swift. Operations Director, Plus Three Consultants (M) Sdn Bhd: I foresee the IR 4.0 having a significant impact on employment with an increase in the number of high-skilled workers to meet the demands of the future economy and technological advances. An increase in the implementation of AI technology could potentially improve the quality, efficiency and productivity of supply chains. But, always retain the basic principles. How do you plan to take advantage of the IR 4.0? What is your timeline in adopting it in your business? Lyu En: In fact, smart construction has already been applied in our projects. Specifically, in the Lexis project in Kuala Lumpur, we have innovatively applied the first smart site system in Malaysia. The Smart Site System uses internet technology and collect real-time information data on construction site personnel, machinery and equipment as well as other key elements. The system uses big data, cloud computing and other technologies for rapid analysis and processing. Also, it uses the Smart Site Mobile App and BI platform to grasp the status of project construction workers, equipment, safety and quality in a comprehensive and timely manner, so that it can provide a scientific basis for project construction management, which can effectively improve the digitalisation, refinement and intelligent management of construction. We plan to steadily advance Industrialisation Revolution 4.0 in phases in Malaysia and remain at the forefront of the application of smart construction. The second stage is to promote smart construction gradually. On the one hand, the Smart Construction Site system is applied in more projects, and on the other, is to expand the scope and depth of the application of the Smart Construction Site. The third stage is to gradually realise semi-automation in project construction and even automation in the production and installation of prefabricated components in order to improve the overall project management efficiency with a higher level of technology application. Wei Han Lim: To support the evolution of IR 4.0 in the construction industry, it is crucial to integrate the emerging technologies, starting from the supply chain. Dextra, being a leading manufacturer and distributor of engineered construction products, has already considered the Wei Han Lim, Sales Manager (Malaysia, Singapore, and Brunei), Dextra Manufacturing24 MASTER BUILDERS JOURNAL #122 Special Feature evolution of the construction industry decades ago. To ensure our commitment to quality, Dextra has been certified with ISO 9001 back in 1996 and was the first ASME-certified manufacturer in Southeast Asia in 2009. We have also incorporated automated manufacturing for our main product, rebar couplers, that ensure the accuracy and quality of the system we deliver worldwide. Following the recent construction trend, we have been continuously developing solutions to serve the smart construction market, such as prefabrication and modular construction. Christian Swift: We plan to introduce new technologies to the Malaysian construction industry over the next 6-12 months through the use of our in-house ‘Forensic Graphics’ media team, which is specifically dedicated to the preparation of fully animated, multi-media movies and interactive presentations to present complex disputes clearly and concisely. We also intend to use AI planning software and drone technology for tracking job site progress and photographic records inside buildings, which helps keep people safe and requires fewer people. Tom Karemacher: Procore is focused on connecting everyone in construction on our global platform. We are expanding our artificial intelligence capabilities. Our customers depend on Procore as their system of record. With our investments in analytics and AI, we’re becoming their system of intelligence and helping customers unlock the value of their project data through powerful insights that enable better, data-driven decisions. Numerous catalysts have emerged to help the construction industry accelerate digitisation, including mobile accessibility, labour shortages necessitating increased productivity, growing regulatory and contractual complexities, and under-utilised data. COVID-19 has made the industry much more aware of the importance of digitalisation, that data will be as important to construction as concrete. Our platform connects stakeholders and gathers insights, thus improving collaboration while reducing waste and rework on projects. This results in more time and cost savings, improved safety and productivity, higher margins, and enhanced project delivery. The years ahead will be transformative in terms of new technologies like AI, data science, drones, robotics, and predictive analytics, all intertwined with the very human process of building. As more businesses adopt technology, roles within the industry will evolve. What won’t change is the need for people to be connected and to have a single ‘source of truth’ for the project. That’s Procore. In your opinion, how can MBAM do better in assisting its members to leverage IR 4.0? Lyu En: MBAM can organise promotional learning and training sessions related to IR 4.0 within member companies to deepen everyone’s understanding of smart construction and work together to achieve the goal of IR 4.0. It can also organise case-sharing events related to smart construction or technology competitions to set an example of excellence in the industry. Wei Han Lim: In our opinion, MBAM should be able to assist in preparing the future workforce for IR 4.0. This may include the promotion of IR 4.0 awareness to various stakeholders, enhance skill programmes or training modules for the construction supply chain and act as a facilitator for discussions between the industry and the government. Christian Swift: Offer its members guidance and training on IR 4.0 technologies and provide regular updates on its impact on the Malaysian construction industry. What can the government do better to help the industry adopt IR 4.0? Lyu En: From a national perspective, the government could clearly put forward the development vision and objectives of IR 4.0, increase the investment of resources from all parties, strengthen the confidence of foreign investors and promote the transformation and upgrading of various industries. The government could introduce foreign companies with high-tech construction technologies, promote industrial innovation and progress in the form of joint ventures, and simultaneously promote the development of the local construction industry. It could also introduce a group of industry professionals with advanced, sophisticated, and cutting-edge technologies. The upgrading of any industry cannot be achieved without high-end technical talents. Thus, it is important to issue favourable policies to attract national or foreign talents to work towards the realisation of Malaysia’s IR 4.0 strategy. Wei Han Lim: To enhance the industry adoption of IR 4.0, the government may consider improving its policy intervention to encourage the application of specific technologies. This may include implementing various incentive schemes for adopting new technologies, upskill training/ programmes for existing employees and improving the education syllabus for future employees. Christian Swift: Provide clear guidance on IR 4.0 and the government’s strategy and timeline for its implementation. Provide grants/tax breaks for training and investment in software and equipment. Stronger together. In today’s fast-changing environment, it is ever more important that the construction industry stands united to overcome the challenges to come. As the prime mover and recognised voice of the Malaysian construction industry, MBAM informs, educates and advocates on behalf of the industry as a whole. Reap the benefits by joining forces with one of the country’s most respected trade associations – with opportunities for increased business and growth through exhibitions, trade shows, seminars, industrial training and conferences, as well networking opportunities amongst more than 16,000 members and 37 affiliated organisations. Be a member today, and let your voice be heard. Contact MBAM at 03-7984 8636 or email ed@mbam.org.my/mbam01@mbam.org.myCover Feature Stronger together. In today’s fast-changing environment, it is ever more important that the construction industry stands united to overcome the challenges to come. As the prime mover and recognised voice of the Malaysian construction industry, MBAM informs, educates and advocates on behalf of the industry as a whole. Reap the benefits by joining forces with one of the country’s most respected trade associations – with opportunities for increased business and growth through exhibitions, trade shows, seminars, industrial training and conferences, as well networking opportunities amongst more than 16,000 members and 37 affiliated organisations. Be a member today, and let your voice be heard. Contact MBAM at 03-7984 8636 or email ed@mbam.org.my/mbam01@mbam.org.myNext >