Yes, Brothers & Sisters – that dramatic of a change is here with OS2 (operating system 2)! It will not be 60 years from now. OS2 is being implemented now and will be mainstream by the middle of this decade for most construction companies and for a couple of sectors – end of this decade.
Labor Rising will attempt to explain the two parts of OS2 that will affect your career and pension.
The first part of OS2 is under the hood, or out of view so to speak, and is taking place with OS2 now! It is not seen by the average solid field journeyperson. An analogy most may understand is that the 55 Belair had a 265 ci small block. Can you upgrade that with today’s technology? Absolutely. You can make that small block far better; however, it is still a 55 – 265 cubic inch small block!
That small block is the state of construction right now and has been for the last 60 plus years. You can put all the current technology you want on that engine, but it is still a 265 small block engine. So, technology enhanced systems like BIM (Building Information Modeling) & Lean IPD (Integrated Project Delivery), along with others, are enhancements to a 265-small block engine. But nothing more.
The pyramid style of construction, as it is called today and has been for the last 60 plus years, has NOT and does not work – case closed. However, if we ONLY know and have a 265-small block, then that is all we know!
Enter OS2 – because technology has changed so dramatically – we are now entering an era that will transform how every aspect of construction is performed. Very shortly, a C8 ZO6 – 5.5-liter flat plane crank will be under the hood of construction. And that is a 335 ci engine. Not much bigger in size; however, it packs several hundred to over 1,000 horsepower! OTHER THAN THEY ARE BOTH ENGINES – THEY ARE NIGHT AND DAY! It is because of the operating system improvements in the auto industry that the ZO6 exists. Construction is now on the threshold of its first massive & transformational improvement using technology.
So, can we put a name on this? Well, under the hood what a Rank & File tradesperson cannot see is…
Data Gumbo and PrairieDog Venture Partners Collaborate to Transform Capital Projects with Smart Contracts
An excerpt:
June 10, 2020 08:00 AM Eastern Daylight Time
HOUSTON–(BUSINESS WIRE)–Data Gumbo, the trusted transactional blockchain network for tomorrow’s industrial leaders, today announced a partnership with PrairieDog Venture Partners (PDVP), the technology and development arm of the Operating System 2.0 (OS2) research project co-led by the Construction Industry Institute (CII) and the Construction Users Roundtable (CURT), dedicated to the creation and advancement a new business model for construction.
As you read this, think about every aspect of construction that you most likely know of but generally do not get involved with. General headings include bidding, procurement, safety, labor, contracts, financing, mobilization, invoicing, estimating, weather, transportation and far more. Then think of the subsets of these categories and also that any party involved can and may default on an ability to perform a task once assigned and/or need to be replaced on the fly and in that moment.
With the 55 Belair (pyramid style of construction delivery today) it can take the above actions months and years to get all the ducks in a row in order to actually DO THE JOB! And the pyramid style of construction may falter or shut down as parties’ default or cease to exist during the job, and also by the way, before and after the job.
With the advent of OS2 and going forward, all those tasks above and more will be performed in DAYS – complete for a shovel ready job of every type! This will have a direct effect on day to day R&F tradespersons in the field – both union or not!
Let us look at one of the above tasks – transactional costs. Do this please: Take an aluminum pop can and crush it under foot. That is what this aspect alone will look like – this is what the R&F will not see. Transactional costs/fees with be crushed from approximately 40% down to 4% — just like the can, in one fell swope. Construction stocks will have value in a portfolio once again. That is a big deal.
A solid example of the early use of OS2 is the oil & gas industry, which is in its infancy and ahead of the construction industry using Data Gumbo and blockchain (also called flat or thin). This may not be good for the UA & other trades when OS2 is using blockchain and are further developed – which is happening now.
The second part of OS2 that the Rank & File WILL SEE, is the transformation of modularization and miniaturization in construction of ALL sectors and markets.
Modularization of components is in its infancy today in construction. Under OS2 it will be raised to a state of art and used day to day for nearly all projects. It will be plug & play. It will also use “off the shelf” parts and components. Little to nothing customized. Even the nuclear industry will do this.
Here is an example of OS2 today. Washington State 80-megawatt reactor: https://x-energy.com/ardp
This example also illustrates the use of miniaturization. It is now planned for a single 80 MW reactor. However, they are currently planning for 4 total reactors, or 320 MW’s: and perhaps more. Outages will be on a single unit(s) at a time. Hours for field construction and outages will be reduced by as much as 75% of what it took to build a single one off 320 MW facility and will scale to number and size. But always less and less in hours and need of FIELD tradespersons.
Miniaturization is now an early budding reality in some sectors of construction. Other sectors are overcoming the engineering obstacles that remain. This IS NOT theory. You know some of the companies that have solved the engineering hurdles. They are heavy weights on the market indexes. It is just a few now; however, 4 will turn into 8 and 8 into 16, etc. These are the early adopters of OS2. They are among the several that are doing the beta testing as Labor Rising is writing this.
Once these few remaining hurdles are overcome, construction will go from a 55 Belair to a 2021 C8 ZO6! It is expected to happen by mid-decade, for some end of this decade. Biden’s infrastructure legislation will put this on steroids with huge deal flows. OS2 will add back jobs because of that deal flow, but not enough to offset job loses across the board because of OS2. Hours to fuel a career and pension will put both in jeopardy. And that is in a great construction environment.
The demand for skilled field tradespersons will be reduced overall. There will be some exceptions, such as welding & rigging skills to name a couple. BUT, because of modulization most will be in a fabrication setting and not in the field.
Organizing opportunities will diminish on the field side of the ledger. The irony here cannot be overstated. The trades finally get an honest and fair Labor Secretary and will not be able to use the fair NLRB department he will oversee for two primary reasons. First – the trades truly suck at organizing and few know their way around even writing a charge much less a full and robust campaign. Even fewer have seen the inner workings of an NLRB office (using this term as both a metaphor & literally). Recruiting and selling are NOT organizing – never have been! Second – the non-union has 90% of the construction work. The non-union is going to be decimated to a far greater degree in the OS2 era and field construction, maintenance, and outages are going to be hit hard. Trying to figure this out as a union organizer is much like trying to catch a falling knife. We also, by and large, have few organizers who know how to do IN-DEPTH research pertinent to being able to ID the survivors or merged non-union construction companies. The non-union will do everything possible to kill off the 10% of trades market share. Also, CURT & CII may have tolerated and/or actually want the trades to stay in the mix. In the era of OS2 – if you can not move and adapt you will die. Not a strong suit for our internationals. Then consider how many union firms are double-breasted! Who are the construction owners & end-users going to save?
Even The Pro Act, the spin on skill shortages, and Secretary Walsh in office will not prevent OS2 from happening.
None of this is the organizers’ fault. Internationals DO NOT teach this past window dressing BS classes.
Our next blog will deal with vertical agreements in the trades and those trades that use them. Labor Rising has a solution on that.
The blog after that will be solutions for increasing market share in the era of OS2. As we stated in the last blog – if there was ever a time to have LOW market share – it is now. A potential silver lining still exists to the piss-poor strategy of Value on Display! VOD has been a disaster every measurable way for decades – it has to go!
The solution, as is the case with many things, will depend on senior leaders moving in a completely new direction. The word “bold” is overused and worn out by our senior leaders, so we do not use it here.
Perhaps many R&F will have a little better understanding of the 2 sides of OS2. And perhaps finally conclude that…
“if you see a good fight – get in it”
Danny L Caliendo
Organizer
Labor Rising
