I think there are 2 potential outcomes from this accusation, the one that AECOM are gambling on, that first mover advantage positions them as the Amazon of AEC. There are fundamental reasons why this may not happen, as they don’t own the entire supply chain and remain reliant on external teams. This may require further integration of disciplines outside of their expertise where friction will still be a consideration.
The second possibility is they do gain market advantage, but rivals catch up and even deliver better performance learning from early mistakes, or achieve better outcomes at lower cost.
It is understandable why AECOM are gambling at this moment in time, because doing nothing is no longer an option. The technology they now own is important, but it is the data they own, when structure correctly, that is seen as invaluable.
The advantage for AECOM is data ownership and early adoption. The risk is it creates a faster race to the bottom, and doesn’t fundamentally change the business model that open data and systems really can accelerates digital innovation.
My suspicion is that this is very likely going to create a faster race to the bottom. I think the important factor is to understand and see if AECOM is able to restructure the business model or contracts to move away from the billable model.
The thing is the client will become aware of this capability and desire to capture the benefit at lower cost or, if costs remain the same, could increasingly begin to bring early stage design in house using AI solutions + a small team of engineers. The competitive pressure will come from both sides.
100% agree on who likely benefits - I think we in the industry are sleeping on talking more about this and aligning interests. From within the field, the coming experimentation in new pricing structures will bring decent opportunities for some of us, but turmoil for probably many more. From outside the field, I’m hopeful about more things getting built faster and better!
Completely agree, I'm really curious to see how the pricing models especially the billable model gets rethought in the coming years. It's been an disincentive for innovation, but hopefully this purchase spurs further interest in tech adoption in the consulting / design segment
I think there are 2 potential outcomes from this accusation, the one that AECOM are gambling on, that first mover advantage positions them as the Amazon of AEC. There are fundamental reasons why this may not happen, as they don’t own the entire supply chain and remain reliant on external teams. This may require further integration of disciplines outside of their expertise where friction will still be a consideration.
The second possibility is they do gain market advantage, but rivals catch up and even deliver better performance learning from early mistakes, or achieve better outcomes at lower cost.
It is understandable why AECOM are gambling at this moment in time, because doing nothing is no longer an option. The technology they now own is important, but it is the data they own, when structure correctly, that is seen as invaluable.
The advantage for AECOM is data ownership and early adoption. The risk is it creates a faster race to the bottom, and doesn’t fundamentally change the business model that open data and systems really can accelerates digital innovation.
Really great insight.
My suspicion is that this is very likely going to create a faster race to the bottom. I think the important factor is to understand and see if AECOM is able to restructure the business model or contracts to move away from the billable model.
The thing is the client will become aware of this capability and desire to capture the benefit at lower cost or, if costs remain the same, could increasingly begin to bring early stage design in house using AI solutions + a small team of engineers. The competitive pressure will come from both sides.
100% agree on who likely benefits - I think we in the industry are sleeping on talking more about this and aligning interests. From within the field, the coming experimentation in new pricing structures will bring decent opportunities for some of us, but turmoil for probably many more. From outside the field, I’m hopeful about more things getting built faster and better!
Completely agree, I'm really curious to see how the pricing models especially the billable model gets rethought in the coming years. It's been an disincentive for innovation, but hopefully this purchase spurs further interest in tech adoption in the consulting / design segment