Blockchain to transform Construction

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Malachy Mathews explains Blockchain and how it will change the way business is done in the construction industry, providing more efficient and secure solutions for tangible value transactions.

Malachy Mathews is a Senior Lecturer in the School of Architecture at Dublin Institute of Technology (DIT). He is a Board Member of the International Congress for Architectural Technology (ICAT), and European Advisor to the Integrated Engineering Blockchain Consortium. A researcher on the topic of Blockchain, he has submitted a paper to the CitA BIM Gathering 2017.

Describing Blockchain, Malachy says: “Blockchain is a new type of database technology that records ‘Value Transactions’. You can say it is computers replicating what humans do and have done for millennia. This in its simplest form is two people who do a deal, a barter, ‘I’ll give you this for that’ and to confirm the deal when they reach a consensus on its value they shake hands on it whereupon the value gets transferred. The Blockchain technology replicates this action as a digital handshake and records these transactions securely using cryptography. These value transactions are gathered and recorded into a ‘blocks’ and so a database grows. The Blockchain database is different in that it is not a single central database but a database that is distributed to all in its network. The transactors do not need to know each other; they don’t need to trust each other and indeed the transactor does not need to be human. The Blockchain can have lines of code that will initiate a value transaction if conditions are met. These are called ‘smart contracts’. The increased introduction of AI (artificial intelligence) ML (machine learning) and IoT (internet of things) will use Blockchain technology to validate and record these non-human value transactions.”

BIMIreland.ie asked how Blockchain will affect the industry in the next few years? “The design and construction industry is an ecosystem of value transactions,” he explains, “Some of these value transactions are tangible and others are intangible. Blockchain technologies can provide more efficient and secure solutions for tangible value transactions i.e., contractor payments, supply chain management, material quality, most all activity that is currently recorded in a ledger system can be performed using a Blockchain. However, there is no method of measuring and rewarding intangible value in a design and construction industry which generates enormous amounts of intangible value. Blockchain can unleash this potential value in an industry that is increasingly powering its economy by converting created virtual value to a physical real world value.”

“The current industry is fragmented, adversarial and driven by legacy hierarchical structures,” Malachy says. To repair and rejuvenate the industry a new way must be found. He describes the current transformation: “The introduction of BIM technologies and the process methodology in the last 10 years has provided a platform for reform, a transformation to a more collaborative approach. To have true collaboration you must have trust amongst the stakeholders. Blockchain has created new opportunities to incentivise a true networked collaborative culture as an alternative to the legacy hierarchical structures we have now. Collaboration, as is envisioned in Level 3 BIM, is now a real prospect.”

Malachy commenced a part-time PhD following the completion of an MSc in eLearning at DIT where collaboration using BIM technologies was the focus. His research is fixed on the human and social implications of the drive toward collaboration in the design and construction industry and he says, “New technologies, new process methodologies are challenging the industry. This coupled with the speed of change has implications for the education of future generations of design and construction professionals and the re-acculturation of current professionals.”

“The digital transformation of our industry will create many topics for future research,” Malachy says, “but the single most important idea society can take from the Bitcoin/Blockchain experience to date is the proof that a distributed network works and so can provide a direct challenge to the hierarchical structures we have today. Hierarchical structures are being replaced by network structures in many industries simply because networks are more efficient, enjoy higher market valuation, they are fault tolerant, and self-regulating whereas hierarchy requires substantial managerial and administration overhead to secure individual nodes. BIM+Blockchain can have the effect of modifying human behaviour to create a networked ‘Building Profession’ as an alternative to the problematic siloed hierarchical structure we have today.”

Malachy’s paper ‘BIM+Blockchain: A Solution to the Trust Problem in Collaboration’ is available to download at http://arrow.dit.ie/bescharcon/26/

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