Engineering, Construction & Building Materials

Helping clients create value, transform their business, and achieve enhanced performance

Construction and its broader ecosystem is changing radically along the entire value chain, accelerated by the global pandemic. We help industry leaders make bold strategic decisions in this dynamic complex environment to accelerate sustainable and inclusive growth, enabled by transformative ideas, effective execution, and deep capability-building.

We work with leading organizations across asset types (such as infrastructure, real estate, and industrial) and industry sub-segments (such as engineering and construction, design and architecture, building material manufacturers and distributors, investors, and construction technology) to help them navigate successfully a complex business environment marked by strong competition, cost pressures, barriers to standardize due to highly localized norms, risk aversion mindset, and low innovation. Our seasoned experts, rigorous analytical capabilities, and cutting-edge assets combined with an unrivalled portfolio of partnerships and acquisitions helps us deliver lasting impact for clients and create new growth opportunities.

How We Help Clients

Commercial transformation

Lead multi-year commercial transformation journeys with tangible impact across the organization including improved win-rates, increased delivered margin, targeted portfolios, higher resource efficiency, and more profitable and sustainable growth. Our commercial transformation programs help build and expand the business, including tender office, contracting excellence, and commercial excellence.

Operational transformation

Launch effective operational transformations, resulting in EBITDA margin improvement, minimized cost and time overruns, and increased win rates. Using our proprietary full potential assessment, we define a high-level aspiration and perform a holistic diagnostic analysis across 10 core dimensions to identify value creation opportunities. In addition, we support our clients on procurement excellence, planning, lean construction, and value engineering.

Digital transformation

Navigate technological disruption and build a successful, sustainable digitally-driven business enabled by innovation (such as process, tools organization, and mindsets), business information modeling, process digitization, agile engineering, and advanced analytics.

Strategy and organization

Understand the right moves to make at the right time and how to drive them to fruition. We help clients stay ahead of the curve and beat the odds by focusing on core long-term strategic priorities such as operating model review, new business model creation, portfolio rebalancing, cash management, sustainability excellence, diversity, and talent of the future.

Featured capabilities

Infrastructure projects analytics tool (IPAT)

Tracks up to 60 characteristics from more than 100,000 projects worldwide by geography and sector and gives visibility to early-stage projects, pre-financing, and tendering. IPAT helps companies prioritize spending decisions and shape growth strategies in line with their capabilities.

Engineering, procurement, and construction full potential assessment

Defines a high-level aspiration and performs a top-down diagnostic to assess the potential impact of following best practices and validate value at stake with illustrative analyses. It’s highly powerful for engineering, procurement, and construction companies facing profitability challenges due to increasing market competition.

Digital Maturity Index (DMI)

Helps clients plot their path to digital transformation. DMI benchmarks an organization’s digital maturity defined against seven dimensions: organization and talent, culture, strategy, digital platform, digital assets, project workflows, operations workflow. These dimensions are assessed across five levels, allowing clients to outline a digital roadmap.

Project production management

Helps clients plot their path to digital transformation. DMI benchmarks an organization’s digital maturity defined against seven dimensions: organization and talent, culture, strategy, digital platform, digital assets, project workflows, operations workflow. These dimensions are assessed across five levels, allowing clients to outline a digital roadmap.

Engineering and construction sustainability

Helps clients assess level of exposure with a detailed baseline of emissions, decarbonize the value chain across buildings and infrastructure, set a sustainability strategy, and plan sustainable project turn-around and contracting.

Cement

Cement is essential for construction but accounts for approximately 7 percent of global CO₂ production. McKinsey helps cement companies plan strategic and operational responses aimed at creating a more sustainable model. Via the World Economic Forum–McKinsey knowledge collaboration on the decarbonization of cement we’re building capabilities to help our clients lower emissions through circularity solutions and reducing the need for new virgin components. McKinsey supports cement clients across five key areas: strategy, operations, organization, corporate finance, and marketing and sales.

Examples of our work

Identifying $100 million in savings potential and achieving operational excellence through digital initiatives

Led the first global digital transformation of a construction company, identifying initiatives amounting to potential savings of $100 million, with a significant expected impact on P&L. Introduced agile methodology to create minimum viable products, developed new roles (such as change agents and journey leads), and created an organizational structure to support the new initiatives.

Driving double-digit revenue growth and higher margins through strategy transformation

Helped a leading North American engineering and construction firm deliver significant shareholder value and outperform its three-year strategic objectives through consistent double-digit revenue growth and a higher margin portfolio shift. A multi-phased project over six months focused on identifying value creation opportunities, developing an integrated vision, and finalizing a financial plan aligned with the jointly defined overall narrative.

Building a digital business to achieve 50% month-over-month revenue growth in 3 months

Developed a fully digitized B2B business and established a new brand for a traditional distributor, achieving 50 percent month-over-month revenue growth. Starting from scratch, we partnered with the organization to build an online ordering platform and fully-scalable cloud-based technology architecture, hire the full founding team, launch automated data cleansing and enrichment at scale, and serve real customers within three months.

Identifying value creation opportunities with more than 25% EBITDA improvement potential

Deployed our proprietary full potential assessment capability including a top-down diagnostic assessment to help a European engineering and construction company identify 25 to 55 percent improvement potential in overall EBITDA from core functions like procurement, equipment, IT and digital, and identified 75 concrete initiatives to unlock full value in the organization.