Australia's AEC firms see regulation as AI adoption barrier

Australian architecture, engineering and construction firms see regulation as a bigger barrier to AI adoption than finding practical use cases. A new industry report also places Australia ahead of the global market in digital project delivery.

Research by Revizto found that 32 per cent of Australian AEC firms identified regulatory concerns as the main obstacle to getting value from AI, compared with 24 per cent globally. Just four per cent of Australian respondents said AI lacked a clear use case, versus 11 per cent worldwide.

The figures suggest the sector has moved beyond asking where AI fits and is now focused on how to introduce it within strict rules on compliance, privacy and accountability. That shift comes as large infrastructure and building projects increasingly rely on digital systems for coordination, design and delivery.

Australia also recorded stronger uptake of model-based workflows than the global average, with 29 per cent of AEC organisations operating mostly or fully model-based workflows, compared with 21.7 per cent globally.

Project performance data pointed in the same direction. Australian respondents reported average project budget overruns of 9.8 per cent, below the global figure of 11.6 per cent.

Governance Focus

Jason Howden, chief innovation officer at Revizto, said the local industry had made significant progress in digital construction and was now facing a different question.

"Australia's construction industry has already made world-leading progress in digital transformation. Model-based workflows, digital coordination platforms, and collaborative project environments are now embedded across major infrastructure projects. In Australia's more mature market, the conversation has shifted from whether digital technology can deliver value to how emerging technologies like AI can be governed and deployed responsibly," he said.

The latest findings, he added, show an industry that has largely moved beyond early-stage adoption of digital tools.

"These results demonstrate Australia's AEC industry has advanced well beyond early digital adoption. Digital collaboration platforms, shared model environments, and integrated project workflows are now central to how complex infrastructure and building projects across the nation are being delivered. However, as the industry becomes more digitally mature, the sector is grappling with how to govern AI and meet compliance," Howden said.

The issue is particularly relevant in infrastructure, where projects operate within procurement rules, cyber security obligations and regulatory frameworks designed to protect public assets. In that setting, AI raises questions about how decisions are made, how data is used and who remains accountable when automated systems inform project choices.

Trust in the underlying systems will be essential if AI is to be used more widely across major programs, Howden said.

"As AI starts influencing more decisions across large construction programs, organisations need absolute confidence in how those systems operate. They need to understand how the algorithms work, how the data is governed, and how human expertise remains central to decision-making. In an industry responsible for delivering critical infrastructure, transparency and accountability are essential," he said.

Time Pressure

The report also highlighted a practical constraint on digital change. Some 39 per cent of Australian AEC organisations said lack of time was the biggest barrier to adopting new technology, the highest share of any country covered by the survey.

That reflects the workload facing project teams already managing large, technically demanding programs. Adding AI tools often requires training, integration with existing systems and changes to established working practices.

As a result, adoption is likely to be gradual rather than sudden, Howden said.

"Australian project teams are already managing enormous delivery pressures across complex infrastructure and building programs. Introducing new technology requires time for training, integration, and changes to established workflows. Australian construction teams are delivering some of the most complex infrastructure projects in the world. Implementing technologies like AI requires careful planning.

"This is why AI adoption in Australia will be evolutionary rather than immediate. Rather than replacing human expertise, AI will increasingly augment it, helping project teams analyse large volumes of project data, identify coordination issues earlier, and make more informed decisions across project lifecycles. Used responsibly, AI has the potential to unlock significant productivity gains across the construction sector," he said.

Kurt Brissett, chief digital and information officer at Built, linked the issue to a broader shift in how construction businesses manage information.

"AI is forcing us to rethink not just how we design and operate, but how we govern and control our data. As the report shows, data control is quickly becoming a strategic imperative, not just a technical one," Brissett said.

The emphasis on data control reflects a wider concern across construction that weak governance can undermine automated systems. If project data is spread across disconnected platforms or poorly managed, insights drawn from AI tools may reproduce errors rather than reduce them.

For companies overseeing projects worth billions of dollars, that creates operational and financial risk. The findings indicate that in a digitally advanced AEC market such as Australia, the next phase of AI adoption will depend less on proving basic usefulness and more on building processes that satisfy regulators, reassure project owners and keep human judgment at the centre of decision-making.