The Digital Construction Site: Trackunit’s Soeren Brogaard on transparency and connection

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Orbit - An Hg software leadership podcast 20 min 1 speaker 7 chapters transcribed 1 month ago
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Why has construction productivity flat‑lined since the 1990s?

Soeren Brogaard 0:02
Overall productivity has basically flatlined since nineteen ninety five. And that Massive gap. When you compare that to the level of digitization in the industry, when McKinsey looks at that, and there was a really insightful report that came out two or three years ago, they actually rank construction as the least digitized industry in the world. If only track unit knew what I know or if ninety percent of the information that I sit with is made available to the organization, then we just simply make better decisions. The way we do that is by an extreme level
Florian Wolff 0:40
of transparency. Welcome to Orbit, the HG podcast series where we speak to leaders and innovators from across the software and tech ecosystem to discuss the key trends that change how we all do business. My name is Florian Wolff, I'm a partner at HG, based out of our Munich office, and I spent most of my time around automotive and engineering topics. And as part of this, I have the pleasure to be joined today by Sorim Brogart, CEO of Track Unit, part of the HG family since earlier in 2021. Good to be here, Florian. Based in Denmark, TrackUnit is a leading software as a service firm operating in and around the Internet of Things. And more specifically, TrackUnit focuses on providing telematic and data services to the global construction industry.
Florian Wolff 1:29
with a mission to eliminate downtime. But before we get ahead of ourselves, let me turn to Soren. And maybe Soren, why don't we begin with a short introduction to the opportunities and challenges digitalization presents to the construction industry and how track unit fits into this. Happy to do
Soeren Brogaard 1:47
that and thank you for having me and pleasure to be speaking to the H D community on this very exciting industry. that we are defining as construction. It happens to be the third largest industry in the world when measured on B and P and it actually represents some amazing opportunities for a lot of us in tech. First one I will point out is that if you look at the overall productivity in construction that I'm pretty sure most of us have seen in our daily lives. the overall productivity has basically flatlined since nineteen ninety five. And that massive gap when you compare that to the level of digitization in the industry, when McKinsey looks at that and there was a really insightful report that came out two or three years ago.
Soeren Brogaard 2:35
they actually rank construction as the least digitized industry in the world. uh quite profound and and when they uh measure that and state that it actually goes around how people work. how organizations get things done with the use of uh digital means. So we have a sort of big history of uh unproductivity uh issues uh across uh the industry. And you if you double click on why that is First of all, i there is a lot of unknowns. All the way from something very simple to understand like the weather.

How does Trackunit use extreme transparency to turn data into better decisions?

Soeren Brogaard 3:09
to when something in the production line or in the supply chain goes wrong or is delayed, it basically affects everything. So there's a high degree of complexity and there's also quite a low level of investment in IT and in software and technology in general. And if you double click on the space that we serve, which we will come back to, but if you just look at machine manufacturers' OEMs, the caterpillars, the cometos, the Volvos of this world. their percent of revenue in core R and D and research is below two percent. And it comes out of a industry that is really almost built around single digit margins. And the way to recoup a single digit market or margin business is that you charge for unforeseen or basically changes uh that is unforeseen and you charge really big for that.
Soeren Brogaard 4:00
You ac basically recoup your business model. from things that were not fought through or changes basically. That has sort of created a negative spiral over the last uh ten, fifteen, twenty years. The good news is that there is a lot of focus on this. In fact, uh the inflow of investment. In construction tech, certainly also around the large players on digitizing the entire ecosystem around the machine is really uh taking on.

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