Blockchain in Construction: the digital revolution that is transforming the sector

Finboot Marketing Team
September 19, 2022

The UK Government’s review of Building Regulations and Fire Safety (Hackitt, 2018) identified a series of failings in the construction sector including ambiguous and inconsistent regulations and standards; lack of clarity of roles, responsibilities and enforcement of regulations and standards; poor product testing; and failure to address building occupants’ concerns around health and safety. This thorough review resulted in two major recommendations: the need for far greater traceability and a digital record to provide the golden thread of information

The ability to ensure availability and access to the right information in the right format at the right time is crucial for successful operations within the construction sector. Information quality is as important as information traceability as this is the  information that drives decision-making. 

Understanding “The Golden Thread” 

Contractors in the UK have talked about "the golden thread" for a while now, but what exactly is it? It is the idea of having an exhaustive audit trail that spans the whole lifecycle of a construction project, from sourcing materials to project completion and maintenance. 

Identification, collaboration and clarity before, during and after a project are key to the golden thread being successful. 

Going further, the Golden Thread report from the UK Government talks about the need for a ‘Single source of truth’ by bringing all information together in a single place and recording changes in full. Blockchain technology can address this need for good.

Blockchain technology can provide a solution that not only brings together all of the relevant information but can ensure regulatory compliance. 

How does blockchain apply?

Firstly, all information should be stored digitally to achieve the golden thread. Contractors, subcontractors and asset owners have long kept records and copies of relevant safety, supplier, and project information. However, the disconnect between a main contractor and its subcontractor’s supplier, for example, would mean that these audit trails are rendered useless when retrospective action is needed. 

To ensure a golden thread, all information needs to be stored digitally. Long-standing records and copies of safety, supplier, and project data are preserved by contractors, subcontractors, and asset owners. Moving this information to digital formats and connected workflows via blockchain, allows information to easily be updated and viewed as necessary. 

The more transparent, real-time and collaborative a project can be, the more beneficial the golden thread can be for everyone. Using the golden thread can, in turn  reap benefits beyond increased safety and quality - such as time and cost-saving. 

What can organisations do now to prepare themselves for the changes ahead? 

Given the way information is now stored and used, the golden thread concept—data flowing through the many stages of a building's life and acquiring more related data along the way—seems challenging to implement. When data is organised and stored separately and independently, it does not flow so easily between parties - making it difficult for all to have clear visibility. 

Due to the fact that there are different tools for various stages of the development lifecycle, it makes it arduous for the software or system supplier to export data. Or the party that created the data, and hence was likely the owner of the data at that time, might desire to retain that data for commercial reasons. 

Managing such a high supply chain, keeping track of work, schedules, costs and payments takes enormous effort and requires enormous resources. Construction projects have to deal with different forms of mistakes, delays, and accidents at different stages. 

These key points are areas where blockchain can make a difference and make these processes more efficient, transparent and accountable for all parties involved in the project. 

At Finboot we are committed to the adoption of DLT (Distributed Ledger Technology) to support digitalisation in the construction industry and enable solutions to many of its challenges.

If you want to know more about Blockchain in Construction industry, check out Finboot's ebook 📘 Blockchain and regulations - a digital transformation in the construction industry.

Ebook Blockchain and regulations in the Construction industry