Disruptive change

Background

Disruptive change refers to a significant shift or transformation that fundamentally alters an existing sector, market, business model or societal norm. By changing the traditional ways of doing things, disruptive change can pose risks and challenges, but can also create opportunities. Disruptive change may be accompanied by uncertainty, ambiguity and unpredictability, making it difficult for stakeholders to anticipate and respond effectively to emerging threats or opportunities.

The Systemic Risks Report considers two sources of disruptive change that have and will continue to disrupt the market for architectural services – namely, climate change[1] and technological and innovative change.[2] The Report notes that these disruptive forces are likely to intensify competitive pressure for architects and the provision of architectural services.[3] However, they will also present new opportunities for architects.[4]

In relation to climate change, the Systemic Risks Report observes that architects will face more regulation resulting from initiatives to mitigate and adapt to climate change.[5] It also finds that architects providing “green” architectural services may face increased exposure to legal risk arising from a range of factors, including inadequate skills and expertise, use of untested designs and materials, and failure to explain to their clients what is involved in sustainable design.[6] Regarding technological and innovative change, the Report finds that developments within the sector like automation and modularisation, digitalisation and building information modelling (BIM) will change the nature and scope of architectural services that are required and, depending upon how architects respond, their capacity to discharge their professional standards obligations may be compromised.[7]

This chapter contains an analysis of the key issues discussed during the focus group deep dive into disruptive change. While the focus group discussion was focused primarily on disruptive change associated with climate change and technological change, other factors that could cause disruptive change were also discussed.

Key issues and findings

The focus group deep dive into disruptive change centred on how architects’ preparedness to respond to disruptive change can be maximised. The key issues that were discussed by participants during the focus groups for this theme are summarised in Table 4 below, together with the main findings reached by the Steering Committee.

Table 4. Summary of key issues and main findings for focus group deep dive into disruptive change

The next section of this chapter contains a discussion of the main insights and implications for this theme.

Insights and implications

Architects' awareness and preparedness for disruptive change

Focus group participants were asked how aware and prepared architects are for disruptive change, particularly climate change and technological change. Comments made by participants indicated that there is a spectrum in terms of the level of awareness and preparedness for disruptive change. Some architects may be focused on everyday practice and do not have time and resources to respond to disruptive change. Various focus group participants suggested that some members of the profession may be more likely to follow the status quo rather than take the lead in responding to disruptive change. Other architects may be trying to lead the way by embracing disruptive change and are early adopters of new approaches and technologies. Overall, there are likely to be many architects who are not adequately prepared to respond to disruptive change so that opportunities can be availed of and risks are mitigated, particularly those in smaller practices and sole practitioners.

This is a concerning situation, because it could leave architects and their practices vulnerable to those who are actively looking to exploit opportunities that the market for architectural services currently presents – a risk that was specifically mentioned during the focus groups. A possible consequence of such a development is that new market entrants who are better prepared than architects to respond to disruptive change may, nonetheless, be less capable than architects to deliver design services in a manner that meets existing professional standards.

It is also notable that focus group participants emphasised that architects’ awareness and preparedness to respond to disruptive change is tethered to the level of preparedness of the broader society in which they operate, as well as the specific sectoral participants with whom they interact in the construction projects. One participant candidly stated that unprepared contractors prefer to work with like-minded architects and other consultants. The underlying implication is that it is no wonder that architects as a whole may not be well-prepared for disruptive change because this is consistent with the current state of preparedness of the construction sector as well as society more generally.

Nevertheless, building architects’ awareness of the sources of and implications of disruptive change for the profession and for the delivery of architectural services must be a priority. As suggested by focus group participants, the profession is potentially in the midst of a transformation that could affect what it means to be an architect in very practical terms. Architects need to be in a position to understand the nature of any transformation that may be underway as a result of disruptive change and what it means for them. Education and training should focus on enhancing architects’ understanding of disruptive change and building practical skills so that they can respond to disruptive change in a cost-effective way.

Challenges faced by architects in responding to disruptive change

Focus group participants identified a range of challenges that architects face in responding to disruptive change, including the following:

• Client’s budgetary limitations: Architects may be seen as an expensive option for design services; design solutions that are responsive to disruptive change may increase costs beyond clients’ budgetary limitations.
• Regulatory pressures: Architects are already facing significant regulatory change within the construction sector, such as the NSW DBP Act, which may make it more difficult for them to respond to disruptive change on a voluntary basis.
• Lack of adequate education, training and tools: The framework for education and training for students and practitioners may not be capable of adjusting quickly enough to external disruptive change and tools that could assist with responding to disruptive change may not be readily available or too expensive.

Notably, architects have limited control over the above challenges. Nevertheless, complacency in the face of these challenges could leave architects in a vulnerable position. There are some tangible steps that could be taken. In particular, architects will need the skills to identify the opportunities that disruptive change can present in the context of a particular project. They will also need to build advocacy skills so that they can demonstrate the value of responding to disruptive change to key stakeholders.

Focus group comments about the burdensome impact of recent regulatory reforms illustrate the unintended consequences that reform can have. While the NSW DBP Act and similar reforms in other jurisdictions may help to enhance accountability of sectoral participants for building work and, thereby, reduce the risk of defective building work, the added regulatory burden that such reform may impose could inadvertently limit the capacity of the sector to respond to other risks, such as those associated with disruptive change. Architects will need to find a way to navigate their various regulatory obligations, while also investing in time and effort to better respond to disruptive change.

As for the adequacy of the education and training framework to enhance awareness and preparedness for disruptive change, the Systemic Risks Report finds that university curricula and training programs for architects need to be responsive to disruptive change affecting the market for architectural services.[8] Focus group comments support this finding and emphasise the need for a dynamic approach to education and training that keeps pace with external change.

Improving architects’ capacity to respond to disruptive change

The discussion during the focus groups did not reveal any dramatic solutions that will easily enhance architects’ capacity to respond to disruptive change. Rather, participants stressed the importance of self-reflection by architects in light of disruptive change so that they have a clear vision of their role in the evolving market for architectural services. They also emphasised the need for a commitment to continuous learning so that architects can keep abreast of disruptive change, but also so that they can become experts capable of solving problems as the market changes.

The opportunities presented by disruptive change will differ depending upon the profile and services offered by particular architectural practices. Architects may need assistance to ensure that their response to disruptive change accounts for their particular strengths and weaknesses. Specialisation of architectural services may be a cost-effective way for some practices to adapt to disruptive change.

Responding to climate change

The Systemic Risks Report discusses some of the opportunities, risks and challenges associated with climate change.[9] There was a recognition during the focus groups that climate change presents a significant opportunity for architects and, more specifically, may help them differentiate themselves from other building designers. Participants suggested a range of areas where architects could build expertise, including whole-of-life-cycle building analysis, integration of reuse into building design, and design development that is appropriately tailored to local conditions and needs. Architects who take the time to understand and are responsive to changing market needs in light of the impacts of climate change are more likely to thrive.

Responding to technological change

The Systemic Risks Report also discusses some of the opportunities, risks and challenges associated with technological and innovative change.[10] Various focus group participants suggested that artificial intelligence (AI) and digital tools could have a significant impact on the market for architectural services. Particular concern was expressed about the impact on small practices. The point was also made that human involvement will continue to be critical in the context of the technical tools that are available, particularly in relation to understanding clients’ needs and translating them into designs. However, without further analysis, it is unclear whether and how architectural practices need to change in order to keep pace with these developments. More information is needed about the likely impact of AI and digital tools on the market for architectural services so that architects are better equipped to respond.

Other types of disruptive change

During the focus groups, participants identified a broad range of disruptors other than climate change and technological change, including market instability and failure, over-regulation, geopolitical developments and skills shortages. It will be important for any initiatives to help enhance architects’ awareness and preparedness for disruptive change to account for the spectrum of factors that could result in dramatic change for the profession.

Education and training

Focus group participants indicated that there is a need for more education and training to help architects respond to disruptive change, including availing of the opportunities that disruptive change presents and mitigating the risks that disruptive change could entail. Advice and support on accessing and using tools to respond to disruptive change in a cost-effective way would be useful.

Concluding remarks

Overall, the level of awareness and preparedness to respond to disruptive change associated with climate change and technological change is likely to be limited, particularly among those in smaller practices and sole practitioners. This is not surprising because this is consistent with the current state of preparedness of the construction sector as well as society more generally. Nonetheless, architects need to be in a position to understand the nature of any transformation that may be underway as a result of disruptive change and what it means for them. The profession may need to make adjustments to their services, and the way in which they are delivered, in light of these changes to ensure that professional standards can continue to be met, but also to avail of the opportunities that disruptive change presents.