Engineering and construction companies are changing to meet the growing demands of infrastructure, with the traditional general engineering providers and contractors giving way to larger, more diversified businesses with specialized skills. Winning new contracts is increasingly about having the right expertise, so the battle for skilled resources is likely to intensify even further, with a possible rise in acquisitions to buy that expertise. New infrastructure projects are likely to be on a huge scale, particularly in emerging markets such as India, China and Brazil, so size and global reach will also matter.
With scale comes complexity as the global industry players navigate a tough political, commercial, regulatory and governance environment, which will test their risk management ability to the maximum extent. Margins on mega-projects can be severely impacted by unforeseen schedule delays, sometimes customer driven and sometimes self-inflicted. Although the sector has invested considerably in risk identification and mitigation, in recent years, a number of high profile project failures in the past twelve months raise question marks over the effectiveness of some of this investment.
With these issues in mind, the latest KPMG Global Construction Survey comes at an opportune moment, gauging the views of many of the senior executives of leading engineering and construction companies from around the world.