ARBV Webinar Deep dive into Disruptive Change
Giorgio Marfella
So welcome, everybody and good afternoon. My name is Giorgio Marfella.
I'm the chairperson of the Architects Registration Board.
And as always, I'd like to begin by acknowledging the traditional owners of the land in which we are. I’m in the land of the Wurundjeri People of the Kulin Nation
and I pay my respects to the Elders, past and present.
So today's webinar is the 4th of a series of webinars we've commenced since last year that stem heart of our research project that we did in collaboration with the NSW Architects Registration Board, that identified some potential areas of risk and one particular aspect that we will discuss today concerns the impact of technological change and how that can affect architects, possibly in the future.
Now, before I introduce our speakers today, I'd like to remind you that this is also a, as always, like all the previous ARBV webinars, an opportunity for formal CPD and you will be able to answer a questionnaire focused on today's content by using this QR. If after these slides, you won't be able to retrieve that information, you will also find a link and there will be other opportunities further the down the track in the presentation to enter the questionnaire. The questionnaire will remain open for 24 hours, so it can also be completed for providing evidence within 24 hours and ARBV will provide a certificate after that.
We will still leave the webinar open for informal CPD following the 24 hours window for formal. So I’ll also remind you that of course CPD is monitored and is mandatory in Victoria, so you are all encouraged to make use of this presentation to that purpose.
Now, our presenters today Dariel De Sousa from Dart Consulting and Hank Haeusler from the ARC Centre for Next Gen Architectural Manufacturing.
And I'll leave it to Hank to explain how that centre was set up.
It's a collaboration between different institutions.
And so we have two experts who have, Dariel has collaborated with us before, and has been our speaker in precedence.
And in particular, Hank provided also an input from an expert academic perspective on what potential changes may affect the architectural profession.
Now I'll be, I'm almost ready to hand over, but I'll just remind you as well that we do have a Q&A function that you can use to ask some questions that are pertinent to the questionnaire. For reasons of time we might not be in a position to answer them all. So we'll endeavour to respond to those somehow via a newsletter.
I might be picking some interesting questions just to wrap up towards the end, if there's some time, so I'll see you later.
In the meanwhile, I can simply hand over to Dariel.
Dariel De Sousa
Thank you, Giorgio.
Let me just get my slides in order.
So good morning everyone.
I'm going to start this presentation with some background about the research and I realise that a number of you will already know about the research because as Giorgio mentioned, this is the 4th and final in a series of seminars or webinars that we've been running, to explore the findings and implications of the ARB’s research on systemic risks.
So I'll keep the background brief, but of course if you would like some more detail, you can always go to the reports which I'll reference in a moment.
So the first question to address is what are systemic risks and why is the ARBV concerned about them?
In order to understand systemic risks, we need to take a step back and consider the concept of risk first and foremost. Risk has many definitions.
But it is essentially a concept that expresses uncertainty about adverse outcomes that could materialise in the future.
Moving now to the concept of systemic risks.
Systemic risks extend across the sector.
They can compromise architects ability to comply with their professional standards obligations and they can cause widespread harm to clients, to users of architectural services, the public and the profession itself.
Now systemic risks may be difficult to address because they may be latent.
That is, the harm may not yet have materialised, or may not yet be obvious.
They may be difficult to identify in advance in the absence of good quality information that enables trends to be detected, and they may be too widespread for the regulator to tackle all at once or without assistance from other bodies.
Now the primary objective of the research undertaken by the ARB's was to identify key current emerging and future systemic risks facing the architectural profession in Australia.
And the ultimate objective of this research was to use the insights about these risks to help the ARB's better target proact, it’s through their proactive regulatory activity. These risks that have been identified and in turn, better support architects to navigate systemic risks while discharging their regulatory obligations.
There are two main streams of work that have been undertaken by the ARB's linked to these systemic risks.
The first is a report on systemic risks in the Australian architecture sector, which was published at the end of 2022 and that work was largely based on a desktop review of reports of academic literature and of cases to identify the kinds of risks that are facing architects across the profession.
The insights from that desktop review were then used for a deep dive, and the ARB’s assembled a range of focus groups from both NSW and Victoria, including architects, clients, developers, builders, building surveyors and insurers, as well as a range of other government bodies, to interrogate the systemic risks that were identified in that original desktop review and the results of that deep dive analysis has been shared with you through the course of the various seminars over the past 12 months. And as Giorgio mentioned, this is the 4th and final one of those seminars. But before we get into the substance, it's important to understand why the ARBs have taken this systemic lens?
Basically what they've done is moved away from the individual cases that cross their desks on a day-to-day basis, the actual instances of non-compliance and zoomed out to take a look at the sector and the profession as a whole, and basically adopting this macro perspective, they identified a number of systemic risks across the sector including four, that were the subject of the deep dive analysis.
Specifically, client architect relationships and agreements, D&C procurement, NCC compliance and then finally the subject of this webinar, disruptive change.
So we're going to start broad, talking about disruptive change in general terms and then we will delve more specifically into two aspects of disruptive change, namely disruptive change caused by climate change and by technological change.
So let's kick off the substantive discussion with some definitions, particularly how we defined disruptive change.
So as you will read in the Deep Dive report, disruptive change has been defined as significant and unexpected shifts that alter a fundamental way an industry or business operates. And unlike incremental changes that allow for gradual adaptation.
Change disruptive change may require substantial changes in strategy and operations to ensure continued success and viability.
Now disruptive change can create new opportunities for those that are able to respond to the changing landscape.
But disruptive change can also pose significant risks for those that fail to adapt.
Now, as I sort of intimated in my earlier remarks, there were two primary sources of disruptive change that were the focus of discussion during the focus groups, namely climate change and technological developments, which we will discuss later in the webinar. However, focus group participants were also asked to identify other sources of disruptive change and a number of them are listed here, including market instability and failure.
So for example, a number of very high profile construction companies, that have collapsed over the past couple of years.
There was reference to over regulation or regulatory reform that is imposing considerable burden on the profession as a whole and can compromise the way in which they operate.
Reference was made to geopolitical developments that have affected the availability and cost of input products for building projects and reference was also made to skill shortages that can affect where the projects go ahead and if they do go ahead, how quickly they can be undertaken.
Now disruptive change, all of these sources may fundamentally affect the provision of architectural services, and this is concerning because it creates uncertainty and ambiguity and unpredictability and making it difficult for participants in the sector to anticipate and know how to respond in practice.
So I'm going to pass over to Hank now.
M. Hank Haeusler
Good. Thank you.
Thank you for inviting me today. So, I’m the Director of Arch Manu. And it's a Research Centre led by UNSW. As you can see in the slide here, we've got several fundings from the Australian government to do the research on systemic change and systemic risks.
But we also have a computational design bureau and an architectural office to bring the research we do, into practice.
Next slide. So, we really see the ITTC, the research centre funded by the Australian Government, as a horizontal where we've got the luxury to deep dive into these problems outlined in the report and then test and apply solutions to the problems through specific interventions or projects. Next one, please.
And it's very, very important to bring again the context of the problems in the global challenges that we face in the AEC sectors, the ones namely here that we want to address.
We want to address them through a digital lens through a digital framework because digital affords scalability and speed to address these problems quicker and easier, potentially. To give you an example, an e-mail that I write takes me 5 minutes, but it is instantly everywhere on the planet. So you get speed and you can send it to one person or 1,000,000 people. It's the same effort and scalability.
So I think digital tools are really, really important to address the problems we have, but of course they also bring a risk. Next one please.
So we see ourselves sort of in, in academia in the centre that we we've got the problems that we outlined before that we want to address and you, as the AEC practitioners sit on the outside with the challenge faced of running an architecture business and Arch Manu tries to sit in between by bridging the challenges and the problems that you have with the insights and the knowledges, the knowledge that exists in the in the academic sector.
So we want to create an academic industry Nexus to solve these problems. Thank you.
Dariel De Sousa
Thanks, Hank.
So let's move into some of the key issues considered in the deep dive analysis.
An initial question that focus group participants were asked to consider was how aware and prepared architects are for disruptive change, particularly climate change and technological change.
An important finding from the research is that there's likely to be a spectrum, in the level of awareness and preparedness among architects to respond to disruptive change, particularly change caused by climate change and technological change. However, the point was made by a number of focus group participants that there are also likely to be many architects who are ill-equipped to respond to disruptive change, particularly those in smaller practices and sole practitioners.
An important insight from the research is that architects awareness and preparedness to respond to disruptive change is likely linked to, or tethered to society's preparedness, as well as the attitude of construction sector stakeholders.
So in other words, it would, it's no surprise that at least some members of the profession are ill-prepared to respond to disruptive change, because that mirrors what's going on in society more generally, and one focus group participant very candidly said that unprepared contractors prefer to work with like-minded consultants, including architects.
Now, this lack of awareness and preparedness is concerning for a number of reasons, including point made by 1 focus group participant, which seems to be backed out by some evidence, that private equity firms are on the lookout to exploit opportunities that exist in the market for architectural services.
So a lack of awareness and preparedness may leave the profession vulnerable.
An important implication from the research is that education and training should focus on building architects awareness of the sources and implications of disruptive change.
I'll Passover to you, Hank.
M. Hank Haeusler
So we're working in a different world and the world has not really changed just yesterday, the change is disruptive, but of course it has happened gradually, exponential and therefore slow at the beginning and now very, very rapidly, probably over the last 30 years.
I'm representing, you know, the same kind of age group as most architects that are registered.
I'm over 50, so we grew up in a time in an area where digital was just at the fringe, the beginning, but didn't really hit.
And I think we've been at a point for many, many years now.
That book here from 2012 talked about that where we cannot win the race against the machine.
So it's an illusion to think there are certain things that we can do as humans, as good as a machine could do. So, we really need to change our way how we engage with the machine. And we probably have to change the way we work together with machine.
Next one.
So and of course we see that in other professions and we, you know, observe that that things will change the taxi industry for example, where suddenly Uber come in there, the travelling industry where Airbnb comes in there and of course it's an illusion to think, we as an architecture profession are immune to these changes.
All professions will change, and increasingly when you look through the statistics, and so the documentation, creative professions will be as much effective as blue collar professions where potentially past, we thought, well, a job and assembly line might be taken over by a robot.
Many of the jobs in architect are doing during the day many tasks and architect is doing during the day, can be already automated through an AI system, so we might not use architecture as a discipline, but we'll definitely be seeing changes in the way architects do their day-to-day job and how an architectural business will roll.
Next one please.
Because we're living in a second machine age, and we all have experienced in our lifetime, the first machine age, where first machine age technology is just electricity or combustion engine have changed the way architecture was perceived.
So the example I always give here is without a combustion engine, you wouldn't have a car.
Without a car, you wouldn't have urban sprawl, so our cities would look completely differently.
Similar with electricity.
Without electricity, you wouldn't have an elevator.
Without an elevator, you wouldn't have high rise, or architecture would look differently.
I think the big difference now is not how architecture, as the build environment looked like in the second machine age, these technologies are more pervasive, so it's more the way how architects will work and the architecture office will run, will change. Architecture might still look the same as if you look at the moment.
Over to you Dariel.
Dariel De Sousa
Thank you.
Thanks, Hank.
So the first question for you to complete as part of your CPD requirements. So the question is, can an architects lack of awareness and preparedness for disruptive change affect compliance with professional standards obligations?
The first option is
A. No. not at all.
B. Possibly, and
C. Definitely.
So I'll give you 30 seconds to have a think about that, and then we'll discuss the response.
Now the question may seem fairly self-evident, but on the other hand, there may be differences of opinion around the room as to the correct answer.
So I'll just share with you my take on this question and the correct answer. So among other things, an architects professional standards obligations require architects to act competently and with reasonable care.
And these obligations imply that an architect must maintain up to date knowledge and skills, so a lack of awareness and preparedness for disruptive change, such as new technologies, new climate imperatives, or shifting regulations to respond to, for example, climate impacts could affect an architects ability and capacity to discharge these obligations.
But of course it will depend upon the context and hence the correct answer being suggested as possibly rather than definitely.
If the disruptive change and its consequences are relevant to an architects work and they failed to respond to those developments, then they may breach their professional standards.
That's not to say that a failure to be aware of climate change impacts will impact all architects, and that it will necessarily breach resulting a breach of their professional standards obligations. But for at least some architects, and potentially many, failure to be aware of the requirements of the changes of the technologies etc. could lead to a breach of professional standards obligations.
Now the next issue we wanted to discuss with you are some of the challenges that were identified by Focus Group participants in responding to disruptive change. As you can imagine, there were many challenges that were identified by participants, and these are documented in the deep dive report.
But just to mention a few first of all.
Clients budgetary limitations.
The point was made that architects may be seen as an expensive option for design services and design solutions that are responsive to disruptive change may increase costs beyond clients budgetary limitations, and therefore, that's the reason why it may be impossible, or practically very difficult for architects to embed or respond to climate change or other forms of disruptive change in their solution.
Another challenge that was referenced was regulatory pressures. Architects mentioned that there is a lot of regulation that affects them and there's also a lot of regulatory change and reference was made in particular to the NSW Design and Building Practitioners Act, which has come into effect fairly recently, which may make it difficult for architects to respond to change on a voluntary basis so they're busy dealing with their Regulatory obligations, and then they're being asked to do additional work to respond to disruptive change, which they may not necessarily be mandated to respond to.
There was also reference to the lack of adequate education, training and tools.
The point was made that the framework for education and training of students and but also architectural graduates and practitioners may not be capable of adjusting quickly enough to respond to external disruptive change.
The point was also made that tools that could assist with responding to disruptive change may not be easily accessible, for example.
They're not easy to use, or they may be too expensive for at least some practitioners or some practices to use in their day-to-day practices.
Now, in relation to the first of those challenges, the financial limitations.
One of the key findings, which is represented on this slide, is that there are significant financial and practical imperatives within the construction sector that do not support a responsive approach to disruptive change.
The point was made by clients, by developers, by contractors and by building surveyors in the focus groups that clients are focused on getting the highest yield from their buildings, and this may preclude appropriate responses to disruptive change, including, for example.
Energy efficiency measures in high rise buildings. Now, notably, architects have limited control over the clients budget and this leads to an insight from the research that architects may be complacent about disruptive change because the sector as a whole is not supporting them to be responsive to change.
An implication of these findings and insights is that architects will need to build advocacy skills so that they can demonstrate the value of responding to disruptive change to key stakeholders in the context of the provision of design services.
Now you're probably thinking easier said than done, but on this point, clients in the room actually said that they need to be educated, to achieve the best solution and by best solution we're talking about, a functional solution that meets their needs, but one that is cost effective and also responds to disruptive change because at the end of the day the client drives the aspiration, the budget and the fees for the project.
And they're a key stakeholder that needs to be convinced that disruptive change needs to be responded to or incorporated into the design services.
I'll pass over to Hank now.
M. Hank Haeusler
Good. So we live in kind of a fickle, as an architecture profession we have systemic risks and to disruptive change and we have to change and we don't really know where to look to, and I can feel that kind of pain because we are vital for meeting the net zero targets.
We are vital for attacking housing shortage, but if you look into how we are as architects, we are very fragmented.
We're very vulnerable to rising tensions. You know, if clients come, if projects comes and go the government spends money, the public sender spends money or not spending money.
It's very, very tricky to do an architectural business to be an architecture business, in the current climate.
Despite our socio economic importance, we have been, as a sector, very, very slow to adapt digital advances.
But I believe that the ADE the Architecture Design Engineering industry can benefit from academic foresights because we research these topics and have that knowledge. If our findings are better implemented.
And I think at the moment we, as academics, have not done a proper job in working very good together with the architecture sector when it comes to bringing problems from your sector into our research.
Next one.
One observation I've made in in the research is doing that while you've been fragmented, you don't really as a sector have innovation mechanisms.
I think it's too much to ask really, and affirm with three to five people to be innovative around.
It's not feasible in the in the current kind of climate, any kind of climate to have an R&D department when the firm is very, very small and you're struggling with the feet at the bottom race at the moment.
And as the report I’ve outlined, we need fundamental change and foster resilience and position you on the long term success because you as the architecture professional are vital, and one of the things we're doing to address climate change, to address the housing problem and so on.
So I would argue that we as a university are perfectly positioned for systemic innovation models, because innovation models and systemic innovation is our core business.
We are here to research.
We're looking not into the problem that currently exists, but also the problems that exist as a third horizon.
So luckily here at UNSW and Swinburne in Melbourne and Adelaide University, with the ARC centre for Next Gen Architectural Manufacturing, we have received funding.
Which is critical to overcome those kind of obstacles and help the industry to form an industry academic Nexus to address these problems.
Over to you, Dariel.
Dariel De Sousa
Thanks Hank. So that takes us to the next question which is which project parameters can affect architects ability to respond to disruptive change?
A. Type project time frame
B. Limited scope of work for design services.
C. Limited fees for design services.
D. Limited communication between architect, client and or contractor.
E. None of the above, or
F. All of the above.
So I'll give you 30 seconds or so to consider those responses and post your response using the app.
So here we have the answer which is F. All of the above. A bit of a no brainer, but it is important to take stock of the kinds of things that can really prevent architects from being capable of responding to disruptive change.
So let's just walk through each of the options and it's notable that many of these characteristics of a project are prevalent in the D&C context in particular.
So first of all, tight project timeframe when the project timeframe is tight, this limits the opportunity to research, to adapt, to incorporate innovative solutions into the design.
Secondly, limited scope of work for design services.
When the scope of design services is limited, this reduces the architects ability to influence key decisions, making it harder for the architect to propose and or implement options that are responsive to disruptive change.
The third answer, limited fees for design services.
Again, if the fees are limited, this restricts resources including time and tools that might be needed to address and respond to disruptive change.
And then option D. limited communication between the architect, client and or the contractor.
This hinders collaboration between these parties, which are crucial to influencing the client to allow for climate disruptive change to be accounted for.
So now let's move to some of the more specific sources of disruptive change that were considered by focus group participants.
The first one, climate change.
Now, an important point that was made by focus group participants that is that in fact climate change can present a significant opportunity to architects and more specifically may help them differentiate themselves from other building designers. Participants referred to a whole range of different areas where architects could build expertise, including whole of building lifecycle analysis, integration of re-use into building design and design development strategies that are truly tailored to the local context.
And in this case we're talking about a context that may involve floods, bush fire risks, coastal inundation etc.
So making sure that the design really meets the local context.
The point was made that architects who take their time to understand and are responsive to the changing market needs, in light of the impacts of climate change, are more likely to thrive. But in contrast, architects who fail to do so could miss out on those opportunities, and because they are not sufficiently prepared.
But also those that do exploit the opportunities, there are still risks, for example.
They may innovate using sustainable design techniques that are untested and then those design techniques fail in practice when the building becomes operational.
Now a link to this point, one of the key insights from the focus group discussion was that architects face various challenges in deciding whether and how, to respond to climate change and the participants noted, a number of different challenges, including the fact that there may be contradictory information about climate change impacts and how to respond to those in practice.
The point was also made that in the case of some climate change impacts, the solution may be financially unviable to make a building truly resilient to the relevant impact. It may not be financially possible to do that.
Another point that was made was, as I mentioned before, the built outcomes may be certain uncertain when innovative design techniques are utilised.
It was also mentioned that regulation may lag behind practice and therefore architects lack sufficient regulatory guidance to know how to respond to climate change.
And then the point was made that some architects may lack adequate skills to really appreciate climate change risks and know how to respond to them in practice.
An implication of these findings and insights is that architects will need to build expertise in a range of areas in order to capitalise on the opportunities presented by climate change, and I'll pass over to Hank now.
Oh no, I'm not sorry.
There's the next question.
M. Hank Haeusler
And answer the questions for you, sorry.
Dariel De Sousa
Which approach to designing a building could breach an architect’s professional standards obligations?
First of all, ignore climate risks because the available information is confusing and contradictory.
B. Rely upon other consultants to address climate risks, because this is not an architectural design issue.
C. Use a design that is being proven to be successful in another context.
D. None of the above, and
E. All of the above.
So again, I'll leave you 30 seconds or so to post your response.
OK. Again, a bit of a no brainer on this one, but again it's important just to take stock of the nature of the obligations that arise in dealing with climate change.
So the correct answer is, all of the above.
Ignoring climate risks is not really an option, even if the information is complex and confusing and potentially contradictory, in order to discharge your duty of care, and and your duty to be competent. It's important to be aware of that information, process that information and use that information to the best of your ability.
Secondly, relying exclusively on other consultants to address climate risks is not really an option because climate risk is likely to be relevant to various aspects of architectural design, including materials, including site orientation, and making the structure resilient to climate impacts.
So, ignoring these risks could again result in a breach of your duty of care.
And lastly, C. Using a design that's been proven in one context will not necessarily cut it in another context. Each context may have local conditions that are specific to that particular area, that need to be accounted for and reflected in the design. So, one area may be flood prone, another area may be bush fire prone, and another area may be subject to drought and increasing temperatures.
And it's important to take into account the local context and ensure that the design is responsive, responsive to that local context.
Now finally, let's consider the focus group comments on issues arising for architects in relation to responding to technological change.
Various focus group participants suggested that artificial intelligence and digital tools could significantly impact the market for architectural services, and particular concern was expressed for small practices and sole practitioners.
The point was also made that human involvement will continue to be critical in the context of the use of technical tools that are available, particularly in understanding client’s needs and translating those needs into designs.
Now a key finding from the focus group discussion is that there is a lack of sectoral awareness and understanding of how technological developments will change the market for and provision of architectural services, particularly emerging digital tools and AI.
An important insight that flows from this finding, is that if there is a lack of sectoral awareness and understanding of the impact of these developments, it's unclear how architectural practices themselves need to change in order to keep pace with these technological developments, and an important implication from the research is that 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.
So another question to sort of explore this issue in a bit more detail.
Which approach exposes the architect to the greatest risk of liability when preparing a design?
A. Only use AI tool for simple design tasks.
B. Use AI tool for all tasks and there's no need to check prior to finalisation.
C. Use AI tool for all tasks, but check the design before finalisation.
D. Only use AI tool to check the design after it's been prepared, and
E. Avoid using AI tools in all circumstances.
So again, 30 seconds for you to post your response.
So the correct answer is B. Now as let's walk through each of these responses. In fact, all of these responses entail some degree of risk.
But the question asked for the scenario that poses the greatest risk and the scenario that poses the greatest risk is the second option. Using AI tool for all tasks and no need to check prior to finalisation.
Now, as a lawyer, I've seen probably 20 cases now that have emerged in the last 12 months or so of lawyers doing just that.
They've used AI tools to prepare their litigation submissions. Have, the ChatGPT has produced a range of cases and argumentation for them to rely upon, and they haven't been checked, and then they've presented them in court and they have been very serious consequences for those lawyers, some of which have basically been removed from the profession.
Now the reason why B is problematic for architects, in a similar way, is that relying entirely on AI without any kind of human insight, oversight or intervention, could be found to be professionally negligent. Architects must exercise professional judgment regardless of the tools that they utilize.
Now AI tools can make errors, they can lack context awareness.
They can overlook critical site specific issues and they may not be aware of regulatory changes, and failing to review AI generated work could result in defective or non-compliant designs. Designs leading to liability.
Now, by contrast, all the other options either limit AI use, they involve human review, or avoid it altogether, all of which do help to reduce risk and therefore reduce the likelihood of being found to be liable for professional negligence.
I'm going to hand over to Hank now to talk about climate change and technological change.
M. Hank Haeusler
Good. Thank you.
I want to bring again the attention to what we are responsible in the context of climate change. So, 50% of all global emissions are produced by the AEC sector, by us, 50% of all landfill.
So all the waste that is produced, is produced by the AEC sector and 60% of all the natural resources consumption occur in our sector as well.
So we cannot continue building the way we are. There's simply not enough material around to continue building beyond and there's no space anymore in landfills to continue demolishing buildings as we have.
Next one.
At the same time, most projects are not delivered on budget, not in the deadline, and quite often not in the benefits of the community.
So we really have these kind of six issues that really addresses our concerns, us as the AEC sector for Next Gen Architectural Manufacturing and we need to address them urgently.
Next one please.
Because of course, by 2050, we need to meet our net zero's targets.
But it's not that by 2050, we can start.
We have to be by 2050 at that point.
So it's not really just stopping smoking because it we probably will die at 2050.
It's stopping smoking now because otherwise we'll certainly have serious consequences and problems by 2050.
Next one.
So also we have to do that.
Not only whatever in the same kind of context as we have at the moment, but with an increasing human population. So, in one sentence we have to build for more humans using less materials, emitting less carbon.
Next one.
So again, we have to have speed, we have to act very, very fast.
Next one.
And we need the scalability. And again, as mentioned before, the scalability and the speed are core features for digital technology.
Next one.
So if people ask themselves why, why should I engage with AI and digital tools?
My main argument will always be because the scalability and the speed to address climate change issues.
There's not two different economies.
We are not really working towards a circular economy or a digital economy.
We are already in a digital economy and we need to transform into a circular economy.
So bringing a digital and circular economy together is really essential, and crucial to meet those targets.
Next one.
So we put that underneath the framework of digital sustainability.
Next one.
Where we see digital sustainability as a twin transition, twin transformation where the digitalisation strengthen the sustainability and visa versa.
So I would urge you not to see sustainability and climate change problems and digitalisation and AI as a separate entity, but as a joint entity that you need to look into how we can work, source cleaner materials or use circular materials.
How can we design for computational efficiency to make buildings more sustainable and more effective?
And how we can deploy robotic in prefabrication techniques to build these buildings.
Next one please.
It is also very, very important to not confuse AI and digital tools into one big bubble of architecture, architects and architectural business.
AI and digital tools are one trick ponies. They only can do one thing.
So if you got an AI on your car that is self-driving the car, that's a different AI than the AI you use for large language model to write a text.
Your car cannot write a text and a text cannot ride a car.
We assume and have general intelligence.
We can do all these things, AI or machine learning or digital tools very, very specifically good in one task.
So therefore, keep in mind when you think about digital tools and AI as a buzzword, thinking about what it can do for architecture, what it can do for you as an architecture, as individual, and what it can do for your architecture business.
Over to you.
Dariel De Sousa
Thank you, Hank.
I'm just going to stop sharing my screen and we'll bring Giorgio back to have a Q&A session.
Giorgio Marfella
Thank you and I will just warn you that I've been having some technical issues. So, if I if I cut out, please take over Dariel from me.
We do have some very interesting questions, so I'm going to run them through.
Please be aware to a technical issue the first question for the Q&A cut out here.
Dariel De Sousa
Originally from McKinsey report and then was made independently by a focus group participant.
Giorgio Marfella
Yeah.
Yeah. And I think it's fair to say that with things changing, the structure of organisation can change.
It's no reason why architects could end up being vertically or horizontally integrated into other entities. It's already happening.
It's already there somehow. Under three years we had the multi-disciplinary firm, which is a model that probably is coming back and it might come back.
So it was more intended in that direction, we we're not referring to any specific companies to be clear?
And the other one is also the observation that small practices may be less able to adapt to disruptive change. Again, this stems from our research, right?
Dariel De Sousa
Yeah. So, the point was made that, architects in, and this is not intended to be derogatory at all.
And it's not a point made by the ARBV, it came from focus group participants.
Giorgio Marfella
Hmm.
Dariel De Sousa
And the point made by architects themselves is that architects are so busy running their practices on a day-to-day basis to then expect them to appreciate these complex forces that are at play.
Climate change, which itself is a huge undertaking to try and get your head around.
Plus, all these digital tools and expect them to have the time to, you know, raise awareness and then incorporate those aspects into their day-to-day practice is asking a lot of small practices and sole practitioners.
So again, it's just a recognition that small practices as Hank was saying, have their own pressures and they don't they have the luxury that other large firms may have of having departments or sections that are committed or dedicated to looking into climate change impacts and feeding through insights to the various practice areas.
So again, this was a point made by a focus group participant themselves.
Giorgio Marfella
Yeah.
Yeah.
Yes. And Hank, would you like to add something on this? Yeah.
M. Hank Haeusler
But it is it.
Yeah, I think that there is, there's no architecture firm around in Australia that is big enough to solve this problem, so we're working with very large firms together. They're not the norm. They're more the exception in their size. But even that the largest firms, you know, foster or similar with thousands of people will still struggle with these challenges.
Giorgio Marfella
Hmm.
M. Hank Haeusler
In order to address these challenges, you nearly need, like a pharmaceutical company with billions of dollars of revenue, to push a lot of R&D into these challenges.
There's nothing like that around, so therefore it's not really a small practice problem.
Giorgio Marfella
Yeah.
M. Hank Haeusler
It's a problem.
The whole sector, any firm would have. So, you know, a three to five person firm struggle the same way as 100 to 200 people firm.
Giorgio Marfella
Yeah.
Yeah, it's a problem of limitational resources, which can also affect a large organisation that is somewhat static and potentially slower to adapt, I suppose, right?
M. Hank Haeusler
Well.
It is also like a, you know, it's a bit, the problem is so quickly shifting.
It's very, very kind of complex to look into that.
Giorgio Marfella
Hmm.
M. Hank Haeusler
Having said that, doesn't really mean we should put our head in the sand and ignore the problem. We have to address the problem for our own well-being as a human race on planet Earth.
So therefore, the urge is really to say what are just, you know, finding new alliances and partnerships and work together through a systematic innovation framework that can address these risks.
Giorgio Marfella
Very good.
There was another question, actually another three I think we might be able to take them all.
And I’ll see if there's any more that have come up as well.
So do you think that the adoption of AI in architectural practices will contribute to the ongoing race to the bottom for fees? Dariel, this is something a bit related.
M. Hank Haeusler
Good.
Dariel De Sousa
It's a really good point, and this point was raised in the focus groups that, with the emergence of AI, clients may expect that there'll be greater efficiency in providing design services and therefore expect that the fees payable to architects should also reduce because what was done previously by human hands can now be done almost instantaneously by a machine.
So this race to the bottom was discussed during the focus groups and the concern was expressed that there may be an expectation that AI will lead ultimately to lower fees. I guess as, as a response to that potential scenario, architects need to be capable of demonstrating the value that they add, notwithstanding the contribution that AI may make to their practices. So, explaining to the client, and again, easier said than done, how human intervention is needed to complement what is provided by the AI, and in fact there is a greater value add through the human intervention that architects provide.
So it is going to be a difficult challenge.
Giorgio Marfella
Hmm.
Dariel De Sousa
It's already happening in the legal sector in many other sectors where things that were, you know, lawyers were putting down 10 hours for can be done literally by, you know, with the click of a finger.
So the sector will need to consider how to combat this narrative that will no doubt emerge.
M. Hank Haeusler
I agree.
It's really I think it's, I would urge architects to think about their valuable position, what they offer and what they can do.
And when you start thinking about that and you've been a business owner, start thinking about other strategy of your office in the next 5-10, fifteen years. Not thinking about what architecture will look like.
Ignore what architecture look like.
Think about what are the strengths, the weaknesses of your business?
Develop a strategy forward.
Be strategic where architects are very, very good in planning the future of our build environment, but very, very poor in future, implying the future of our professional, our business.
Giorgio Marfella
Hmm.
M. Hank Haeusler
After you've got a strategy implies maybe consult people on that strategy. Put a governance framework in place and then work on that strategy.
You have to be prepared for what's coming. I think being reactive is definitely the way out. If you've been reacted and hope that the government will do certain things or AI will pass by then you probably be lost and you will most likely fear the, feel the consequences by having less jobs, having less work to be done, earning less fees, and really restructuring what your business is.
Dariel De Sousa
Can I just add to that Giorgio?
Giorgio Marfella
Sure.
Dariel De Sousa
I just completely support what Hank has just said that that very point was made during the focus groups that it is really important with this shifting landscape, tectonic level changes, that architects need to have a vision of their place in this changing landscape and strategise based on that vision looking forward into the future.
And really, equipping them with the expertise, the skills, the tools, to enable them to realise that vision. And it will, there will be a lot of commoditisation of services, but there will also be specialisation and it's really these areas of specialisation where architects can strategically position themselves.
Giorgio Marfella
That's right.
So just be proactive is certainly one thing, but perhaps being open to opportunities that AI may also provide is not necessarily the race to the bottom. As we, you know, sometimes unfortunately we have we witness very often in the construction industry.
M. Hank Haeusler
If the race is really an issue, it's important that to understand that you cannot win the race against the machine as the one book outlined. So you have to understand really what, what are you good at as a human and what is the machine better on as a starting point, and you know there are certain things, what are aesthetics?
Giorgio Marfella
Yeah.
M. Hank Haeusler
What are ethics?
Very hard to explain amongst each other as humans, so it's very, very hard to explain to the machine.
So then to understand the emphatic needs of a client is really a strength of an architect.
Modelling a building or putting del schedules into a Revit model.
The machine will be definitely better than you.
Giorgio Marfella
Yeah.
But the professional is an individual and we take care of individual registration boards. Don't forget that.
M. Hank Haeusler
Yeah, yeah.
Giorgio Marfella
So now next question is how can architects balance the integration of emerging technologies such as AI and sustainable materials, while maintaining compliance with evolving professional standards and client expectations?
Dariel.
Dariel De Sousa
Oh, I don't have a silver bullet.
It's it's not easy.
Giorgio Marfella
There's not a silver answer I'm afraid.
Dariel De Sousa
It's it's, it's not easy.
It's not easy.
And, you know, Hank was talking about collaboration, setting up alliances. I mean, amongst small practices within the small practice groups or even amongst the large practices creating pooled resources, trying to think through problems together, working out in a collaborative way.
How do we overcome these challenges in a united fashion?
Because it faces everybody, as Hank was saying.
Small or big? Everyone will be subject to this transformational change and I think having a collaborative mindset will help the profession in, in general combat these challenges together.
So while maintaining your own individual vision and having your own strategy, trying to collaborate with others to deal with the common problems would be my suggestion.
Giorgio Marfella
Yeah.
M. Hank Haeusler
Yeah, I agree.
The. It's impossible to address the problem as an individual organisation or as an individual.
I think that the duty of the individual is training.
Being trained in Arch Manu, developing at the moment, 165 CPD courses on digital transformation to train the architecture sector and we develop a platform that will come out in next few weeks and all these kind of courses are up there.
So we're very active in the training space as an individual. All the ones that participate today are interested and train themselves.
As a company, of course, you know just allowing the individual to be trained and there are probably more training than just CPD courses we are needing. Potentially second educations are relevant because one thing that is very, very certain we living in a very agile, very fast changing world.
So just saying, while I studied architecture in 2001 or 1990 or whatever it is and therefore I know what's going on is no longer relevant.
So lifelong learning becomes really a mandate, and that enables you then to balance integration of AI and sustainable materials, understanding the compliance issues and so on.
But again, when I talked before about the 1st and 2nd machine age, the first machine age increased our muscle power by 1000 times.
You know, a combustion engine motor's a crane. A crane can lift up at tonne. The second machine age increases the intellectual power of human. We are not good with big numbers. We are not very good with conflicting information.
A computer can handle millions of information simultaneously and give you an answer.
So I think whatever the conflicting element that the question put them forward is an item that AI could help. And I think if we understand that we can deploy AI by far better than before.
Giorgio Marfella
Very good.
So there's a last question as well.
I think we can take one minute left and again like the previous ones, it's open to both.
Do we really need more research about the impact of AI in architecture of sorry, I'll read it again.
Do we really need more research about the impact of AI in architecture, given that it has already proven some impact today?
I think it's a fairly straightforward answer.
Perhaps Hank, would you like to start on that?
Do we need to research more and how?
M. Hank Haeusler
Of course you know, otherwise I would be out of business. But no, I think in those serious days.
Giorgio Marfella
But I suppose, how?
How specifically, I suppose we can answer the same.
In which particular aspects of the problem may be probably pressing more than others.
M. Hank Haeusler
Well, most of the AI that have been developed at the moment have not been developed for the AEC sector.
So if you look into the job of an architect from design on the one hand, documentation on the other two other business organisational thing on the business side, I think I'm very certain there's a lot of kind of AI tools that are around there, but to understand and to automate workflows of in the architecture profession towards designing certain things, not much research have been done there yet.
When people refer to Dall-E or Midjourney as an image generation, that's not really architecture, that's creating an image. The computer has no awareness yet of what it actually produced.
It's just an image, it's not architecture.
So in order to improve architecture, you need to understand what jobs architects have, what tasks they're going to do, what process they're going to do and really by a minute scale what they've been doing to train an AI on the data.
So yes, there's a lot of research needed yet to understand the cultural, the social change of AI implementation into architecture. The use of AI in a day-to-day workflow.
Giorgio Marfella
Yeah.
M. Hank Haeusler
Because we are not only dealing with texts like lawyers, we are also dealing with images, we are dealing with spatial information.
So to train spatial models for AI is quite tricky, so I would say there's a lot of research to be coming and needed in the future.
And it's happening quite quickly. So I think over the next three to five years, we will see a lot of equal versions of what ChatGPT is in an architectural sense.
Giorgio Marfella
Hmm.
So the fine grained part of the jobs and Dariel from a pursue you know legal background, from a regulatory perspective would you be able to suggest what could be, I mean, we touched on our research, but what could be some emerging risks in considering AI, particularly in the job of professionals like even other professionals, not simply architects?
Dariel De Sousa
I mean.
I mean the regulatory legal risk is sort of highlighted in that CPD question where we talked about how people might integrate AI into their day-to-day practice. And clearly you cannot rely on AI exclusively. There needs to be human insight. And I think Hank's point about understanding what the computer does best versus what the humans do best is a really important starting point.
A key issue that came out of the focus group research is that while we understand, we know the tools that are out there, they're evolving clearly, but we've got broad awareness of the tools that are becoming online.
What is missing is how these tools are reshaping the day-to-day provision of architectural services.
How does it impact or how should it impact or how could it impact the day-to-day operation ranging from sole practitioners up to the big practitioners and we need to have a strategy for the different profiles of practitioners to work out in the face of all these tools that are out there.
Giorgio Marfella
Hmm.
Dariel De Sousa
What does this mean to your day-to-day practice and how can you comply with your professional standards obligations, noting the existence of these tools and the way in which they're modifying the provision of architectural services.
I know that's a fairly ambiguous response, but I think more work clearly needs to be done based on the ARBV's research, but also a number of different participants who said we don't know how we need to change to respond.
Giorgio Marfella
And yet the regulatory principles didn't change, at least not overnight.
So reasonable care, duty of care, competency, skills and expertise, clarity of communication, client relations, all that still remain. So, the professional conduct expectations may change in due course and may change, but they're still there.
And arguably, there's no reason to somehow throw them away. So, let's maybe that, at least we can, we are in a position to say what not to do, but certainly the debate is open and so look, I have to close now. It was a very interesting presentation.
Dariel De Sousa
Yep.
Giorgio Marfella
I'm sure it will be well received also by those who have participated and so I think again, Dariel and Hank, it seems like probably the best way to conclude that we'll continue to discuss these matters. They're going to stay with us probably for years. So, so we'll definitely consider opportunities at the ARBV to come back on these issues as they evolve from different perspectives.
So again, thank you very much everybody and I look forward for the next webinar again.
Have a good afternoon.
M. Hank Haeusler
Thank you for having us today.
Thank you very much.
Dariel De Sousa
Thank you everyone.
Giorgio Marfella
Bye.
Updated