Use of New Technologies in Project Management and IPD Governance: An Approach to Blockchain and Smart Contracts
The white paper available for download here provides background on the presentation prepared for Project Controls Expo USA, Washington, D.C. October 6, 2022.
The implementation of blockchain in construction appears to be reaching the peak of the hype cycle. Its benefits are described as having the potential to create a sea change in traditional processes bringing dramatic gains in execution efficiency, trust among parties, and payment speed. However, the potential benefits are largely based on broad assumptions, industry surveys, and small trial projects. The technology has not yet crossed the chasm to broad adoption. Hype will decline as significant challenges must be addressed before pragmatic industry leaders with significant risk exposure can adopt the technology on a broad scale. Still, the industry must seek to optimize project execution. This paper reviews the state of the art of blockchain and smart contracts, evaluates four major use cases, and evaluates blockchain as a fit-for-purpose solution in each case. The use cases include discussion of a real-world implementation on a refinery megaproject in Latin America. The paper presents conclusions regarding what will be required to transition from academic to broad practical implementation of blockchain in the construction sector.