Some of the health regulations may pose a threat to the construction industry, a study by PricewaterhouseCoopers (PwC) Sri Lanka said based on Post Recovery Strategies webinar on Real Estate and Construction.
“The biggest risk seems to be the continuation of work and providing accommodation in line with social distancing measures. Unlike other companies, the workforce of engineering and construction companies must be on the job site.”
Beyond providing them with appropriate protective gear, companies can take additional steps to help them stay safe, such as staggering shifts, mandating safe distances between workers, and banning visitors.”
“In other countries, there are Apps that can help keep a track of workers’ locations while on the job, in full compliance with privacy regulations, so management can quickly identify potential exposures to the virus.”
Given the dependency on overseas suppliers by Sri Lankan Engineering and Construction companies, it is an extraordinary challenge to obtain visibility into and manage the behaviors of their supply chains. “To find vulnerabilities in the supply chain and choose how to respond, you need to maximize visibility. Reach out to your suppliers, gather data, and build a dashboard that you continue to update and refine over time.Based on what the dashboard reveals, consider the legal and financial implications, as well as their impact on margins, cash flow, loan repayments, and terms. Make sure that your project controls, risk management, and governance processes can handle all the supply chain changes you consider.”
“For critical suppliers whose long-term prospects are sound, Companies may want to offer contractual flexibility (if appropriate) and technical support, including help in tapping government funding as part of the recovery and stimulus programs all over the world. Yet you also must be ready to pivot to new suppliers as needed. The report predicts that when the pandemic ends, companies will face a new world. The dynamics of the marketplace will change, as the Government may have different views on infrastructure development.”
Meanwhile, in other countries, portfolios are also changing rapidly due to the new emphasis on sustainability and resilience.
“Cities are likely to have a shift, to accommodate more residents who are working from home. Hence, commercial real estate is likely to undergo a prolonged downturn. Based on our discussions with developers, the market for condominium apartments is expected to be depressed in the short-medium run. However, that being said, companies that can emerge from this crisis with solid finances, a resilient supply chain, skilled workers, and the capacity to gather and analyze the data that decision-makers need, will be well-placed to pivot and seize new opportunities. Those organizations will be market leaders no matter how the post-COVID world evolves.”
PricewaterhouseCoopers (PwC) Sri Lanka is an independent entity which is a part of the PwC global network. (SS)
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