3rd Annual Deltek Clarity Study: The Biggest Challenges and Trends for Asia Pacific Architecture and Engineering Firms
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The world is changing, and so is the Architecture and Engineering (A&E) industry. Firms worldwide are taking on the challenges of a crowded market, staff shortages, and digital transformation.
To explore how different regions are making changes to ensure future success, the 3rd Annual Deltek Clarity A&E Industry Study surveyed firms across Europe and Asia Pacific. The study focuses on key benchmarks, challenges and initiatives for A&E firms.
This blog will look at some of the key findings from 200 respondents in Asia Pacific. Download the full 3rd Annual Deltek Clarity Architecture and Engineering Study to see the state of the industry overall, or read on to learn more about the situation across Australia, New Zealand and Singapore.
Asia Pacific firms are embracing changes in technology
Companies in Asia Pacific are more aspirational when it comes to digital transformation. 31% of respondents report their digital transformation maturity will be ‘advanced’ in five years – the highest percentage of any region. And while 16% of respondents in Europe describe their digital transformation maturity as only ‘nascent’ or ‘exploratory’, this was halved for Asia Pacific firms – at just 8%.
With digital transformation high on the agenda, firms in Asia Pacific view emerging technologies as vitally important to their business. Most firms identify data science (91% of respondents), big data (86%) and artificial intelligence (86%) as key to their business, but also identified more emerging technologies as important to the business overall than other regions.
When asked about the biggest challenges facing their IT operations teams, respondents in Asia Pacific highlight implementing new software systems (31%), improving cybersecurity (34%), migrating to the cloud (31%) and finding top IT talent (31%).
And our respondents also told us about the initiatives they’re using to tackle these challenges:
- 52% will create new security policies and procedures
- 48% will build new IT infrastructure
- 47% will consolidate the number of vendors or systems they use
Project management can help resolve key challenges
Although keeping up with technology evolution will be critical for Asia Pacific firms in the next five years, it’s not the only challenge. While 35% of respondents indicated increasing complexity of projects was a key challenge, this is compounded by heightened environmental and sustainability consciousness (29%) and keeping pace with changing client expectations (27%) making the role of project managers more important and more challenging than ever before.
Management and process could be the key to resolving these challenges, and many Asia Pacific firms agree – telling us their top ways to address project management challenges in the next three years:
- 33% plan to more clearly define project management, business development, and design responsibilities
- Technology can also play a role, as 32% plan to invest in better software tools
- 31% plan to improve project information management processes
Better technology, better processes and better information management processes can help firms address project delivery challenges. This year, only 55% of projects were reported as being on or under budget and only 44% of projects are being reported as on or ahead of schedule. As firms look to address these challenges, it’s critical that the project managers are given the time and resources to effectively deliver projects.
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Finding, training, and retaining people is crucial
It’s not just technology and project management processes that are changing. More people than ever are changing jobs in search of greater professional fulfilment.
It’s no wonder then that finding and retaining talent is a major challenge across A&E firms today. 45% of Asia Pacific firms name increased competition for talent as a leading challenge for project management in the next five years. IT operations also face the same challenge in finding IT talent (31%), and 30% say finding and retaining qualified staff is a top challenge for financial leaders, too.
With firmwide talent concerns Asia Pacific firms may need to rethink their talent strategies. There is also a need for technical skills and knowledge, as 40% of firms say that a lack of employee education will delay technology adoption over the next three years.
However, the Asia Pacific region is leading the way in some areas of Human Capital Management. 85% of firms have a significantly higher number of initiatives to support employee wellbeing than two years ago. This is well above firms in other regions, with 64% for the Nordics and 72% for other European firms.
A crowded marketplace is creating business development challenges
The marketplace is crowded and, as a result, competition is more intense than ever. Asia Pacific firms name the increased cost of competing for projects as their top business development challenge (39%), followed by increased competition (36%).
One of the biggest differentiators in the A&E marketplace is technology. 64% of Asia Pacific firms say they have lost potential business to competitors with more advanced technologies. This was higher than in other regions, making technology a key element for business development for firms in the region.
The top three priorities for overcoming these challenges in the next three years include:
- Improving the quality and availability of marketing data and materials (33%)
- Hiring additional staff (26%)
- Geographical expansion (26%)
Asia Pacific firms are focusing on cost and efficiency
As well as business development challenges, firms also face financial obstacles. The top initiatives to address these financial challenges in the next three years include:
- Business process improvement (33%)
- Organizational change or realignment (32%)
- Training project managers on financial management (30%)
- Improving risk management plans and systems (30%)
Firms in Asia Pacific are also more likely to focus on cost and efficiency than the global average, with 34% clamping down on project overrun (versus 31% overall) and 33% wanting to reduce expenses (versus 29% overall).
Financial benchmarks, KPIs and the key to new business
We’ve explored some of the technology, project management, human capital management, business development, and financial management challenges facing Asia Pacific A&E firms, and looked at some of the initiatives firms are using to resolve these challenges. But there’s more to discover. Read the full 3rd Annual Deltek Clarity Architecture and Engineering Study to explore:
- Financial benchmarks for A&E firms
- The KPIs firms in Asia Pacific are most likely to be tracking
- More detail on which measures firms in the region think are key to unlocking new business
Read Next: Clarity Study: How are architecture & engineering firms across Europe and Asia Pacific solving todays’ business challenges?
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