Solid digital foundations are increasingly required as artificial intelligence projects grow in construction. Kenny Ingram, Vice President of Construction and Engineering, and Chris Knight, Global Industry Director of Construction and Engineering for IFS, highlight how the technology is set to transform and streamline the industry.
HOW INDUSTRIAL AI IS SHAPING CONSTRUCTION
Whilst some sectors have spent recent years sprinting towards digital maturity, construction and engineering organisations are finally crossing a major threshold as the potential of automation and industrial artificial intelligence (AI) becomes impossible to ignore.
Faced with tightening margins and complex global pressures on materials and labour constraints, construction and engineering firms are overhauling their traditional value propositions to stay competitive.
As 2026 unfolds, the construction sector is reaching a critical tipping point where AI and connected data move from the periphery to the core of business operations.
The construction and engineering sectors have been through a fundamental reshaping of how companies address long-standing challenges around profitability, productivity, and sustainability – assessing how they respond to global economic pressures, redefining their value propositions, and delivering increasingly complex projects.
As a result, the shift from experimentation to enterprise-wide integration is now well underway, with 2026 guaranteed to mark a critical inflection point in AI adoption.
But it’s essential for any business leader looking to leverage these technologies as essential components of larger digital transformation projects to understand the fundamental building blocks that must be in place before any type of scalable deployment is possible.
GETTING THE DATA FOUNDATION IN PLACE
One of the biggest trends we saw throughout this past year was the rapid adoption of modern enterprise resource planning (ERP) platforms that serve as digital backbones across organisations.
In fact, our Censuswide industry research study found that 63 percent of construction and engineering companies planned to adopt a new ERP system in the next one to two years, a foundational move meant to enable the scaling of AI across their enterprises.
In terms of how many companies are embarking on digital transformation projects, this modernisation statistic has proven to be underestimated.
Nearly a year after making these predictions, we realise that the optimism around the role of AI being able to reshape workflows, project management, and intelligent decision-making is fuelling a greater desire to adopt a future-proof ERP platform as the springboard for scalable, trusted AI deployments.
TAKING POLE POSITION
The latest IFS research study ‘The Invisible Revolution’, which surveyed more than 300 senior executives from leading construction and engineering firms in May and June this year, found that the sector is expected to become one of the most AI-first industries in 2027.
Momentum is clearly building, with 91 percent of firms expecting to increase AI investment this year.
Since we are proud to count some of the world’s largest and most innovative companies in this space as IFS customers, we not only educate them on the possibilities of AI transformation, but we also get their insights on real-world AI applications within their unique operations.
GIVING TIME BACK TO A RESOURCE-STRAPPED INDUSTRY
One of the greatest benefits of AI that we discuss is its ability to analyse and collate data in a much faster way. This gives employees – from workers on the construction site to senior management in the back office – more accurate, predictable, and reliable information.
The most practical example of how this enhanced and automated information gathering and analysis can benefit construction industry organisations is related to the enormous amount of time it takes to prepare their regular board presentations on project performance.
Most companies host interdepartmental meetings monthly with all the senior leaders from each of their divisions. Typically, each team of people takes days, if not weeks, to prepare their data by gathering information across multiple software solutions.
Industrial AI gives construction and engineering organisations more trusted control of their business by removing the unreliability and inconsistency of human guesswork, making it faster and easier to gather, analyse, and report on every dimension of project performance – including profitability, timeline delays, budget overruns, cost forecasting, safety incidents, quality, and more.
Ultimately, leveraging industrial AI to enhance reporting and data sharing across organisations reduces business risk and delivers greater control over project results.
CLEAR AI ADVANTAGES
These benefits are clearly resonating across the industry. The latest IFS research study found that the biggest applications of current AI deployments across construction and engineering firms were project delivery (62 percent) and business intelligence (59 percent).
Out of these early adopters currently deploying AI, companies are already seeing major benefits: 89 percent report profitability gains, 44 percent outperform the cross-sector average in operational efficiency, 42 percent are seeing a supply cost reduction, and 36 percent experience lowering project expenditures.
With the growing economic uncertainty across the globe, the most impactful benefit of industrial AI for construction is greater control over project management. Out of all other industries, the project-centric nature of construction and engineering businesses makes them most at risk of diminishing and/or unpredictable profit margins in volatile and disruptive markets.
Perhaps this is why the latest AI research shows that construction and engineering firms anticipate AI’s greatest benefits to be in project delivery (41 percent) and increased profitability (36 percent).
PLANNING A BLUEPRINT FOR SUCCESS
As we prepare to craft our 2026 predictions for a rapidly evolving industry, we take a moment to reflect on the trajectory of AI adoption and overall digital transformation that exceeded our expectations this year.
It’s clear that in a very short period, most construction and engineering organisations will modernise legacy ERP systems to pave the way for industrial AI and all the potential it offers to deliver greater project control.
The end result will surely be a smarter, more connected, and more resilient industry ready to redefine how the world designs, constructs, and builds.
