Q&A with Baraq Hadi: Vice President Middle East, Oracle Construction and Engineering
On April 20, 2020 by Oracle
With large-scale construction projects being undertaken in the Middle East, and up to 30-40% of expenditure being wasted due to inefficient practices, Baraq Hadi discusses how Oracle Construction and Engineering is driving efficiency in project delivery.
Q: How does the region’s projects market differ from elsewhere in the world?
Projects around the world require the same things. They need the same technologies, expertise and processes. What is different about the Middle East is the historical rate of growth. As a result, there is a bigger lack of the human resources needed to deliver the construction phase of projects than you find elsewhere. In the Middle East, we have big projects – megaprojects, even gigaprojects – that require more technology and resources, and better processes. There is no room for error. That is more critical than the rest of the world.
Q: What are the biggest trends shaping the Middle East projects market?
The maturity of the market varies from a vertical or industry point of view as well as geographically. Project owners are usually government entities that have been operating for a long time, and have enjoyed plenty of finance to deliver what they need. But now that the price of oil and gas has lowered, there is increasing pressure on government finances.
We are seeing people trying to cut corners. The market is not ready for that. In the past, data was not considered in the construction phase. Now, it is coming back to bite them. We are seeing large increases in the cost of maintenance projects because the data was not maintained to start with, not kept up to date, and not created in the right format. The consequences are high.
Q: How much do you think is going to waste at the moment?
The circumstances, market maturity and age of the assets are factors that vary from one project to another. I estimate that the lack of proper data structures, proper processes to support it, and proper skills and resources to take full advantage of what they have could see losses of up to 30% or even 40%. Doing things right the first time saves a lot of money and time at a later stage.
Q: Is the drive to be more efficient and reduce waste creating increasing demand for digital technologies to support project delivery?
The challenge is that the resources deployed on projects have different levels of technology expertise. This makes it harder to deploy and utilise the products that are available.
One of the challenges that we are facing is on the gigaprojects in Saudi Arabia, which are part of Vision 2030. Technology is required to deliver these projects. But how do you effectively deploy the technology and ensure that the resources on the projects, from the owner-operators all the way to the project delivery teams, use the same data sets, and make sure that they are end-to-end for the needs of the project?
Q: What strategies do project companies need to employ?
They need technology-related strategies. First of all, they need to understand what they are trying to deliver. Some of these are new companies that are being asked to deliver gigaprojects in a very short period of time. So there is an issue of time. They need to understand the type of contractors and subcontractors that they are going to have on their project. So they have to build their technology requirements accordingly.
The most important element is the data. It is not about the tools. Any time you take data from one stage of a project to another, you are bound to lose some of the intelligence behind it. So you need the strategy behind the data from the start. Then the tools will come in as a complementary tool to the data structures that you have developed.
Take building information modelling (BIM). BIM is important, but it is not about only BIM. It is about understanding how you are going to use BIM for the full project cycle, from the planning stage all the way to the operations and maintenance stage.
Q: What are the challenges facing the Middle East project market?
One challenge is with established entities that have been in the market for a while. These organisations often have people that are set in their ways. For them, change is difficult. So one area of challenge is to overcome this and educate the users on the benefits they are going to get. It is the same from a processes point of view. Processes are established. Then, when the technology arrives, people do not want to change the process to take full advantage of the technology. In a lot of cases, you have to go back and debate the purpose of the process, then the process itself can change based on the technology.
Another challenge is with new project companies. Do they have a strategy? And if they have a strategy, do they have the infrastructure to support it? We have to take them on a journey to ensure that they understand what they are getting, how they will utilise it and how they will create the data to support it. Even on smaller projects, the technology, internet of things, machine learning, all of those newly introduced technologies require data to operate. So you need to collect data from the outset, in a structured manner so you can utilise it at a later stage.
Q: Who owns the data? Who is responsible for errors, or keeping it up to date?
The owner of the data is the owner-operator of the assets. That is where the data is going to start and where it will end up. All of the companies that come through will come and go within the project cycle. A planner, a construction company, a subcontractor, an asset or facility management at a later stage.
But at the end of the day, the owner-operator is responsible for the asset and therefore for the data. We focus on making sure that the owner-operator understands the benefits and the risks of not having it. We try to work with them to ensure that data is structured and data requirements communicated to all the players within the project delivery.
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