BIM, Blockchain, and Smart Contracts

• Date: 01 August 2020
• Author: By Nancy Wiegers Greenwald

THE CONSTRUCTION LAWYER9Fall 2020

Published in The Construction Lawyer, Volume 40, Number 4, Fall 2020. © 2020 American Bar Association. Reproduced with permission. All rights reserved. This information or any portion

thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.

BIM, Blockchain, and Smart Contracts

By Nancy Wiegers Greenwald

INDUSTRY TRANSFORMATION

Nancy Wiegers Greenwald, attorney and business

executive, is an independent arbitrator and mediator

in commercial and construction disputes. In addition

to being active in the ABA Forum on Construction and

other ABA entities, she serves on the American Arbitration

Association’s Commercial and Construction Industry

Panel of Arbitrators, as well as its Mediation Panels, and

she has been appointed as a neutral by numerous private

clients and courts. The author would like to acknowledge

Erik Sanford, VDC/BIM Director, Dimeo Construction

Company, for his review and contributions to this article

and Steven G. Haines, Director of Technology, BVH

Integrated Services, Inc., for his signicant contributions.

Everything we know about

our industry is wrong in

terms of what we will be doing

tomorrow.

—Jim Cramer, former EVP,

AIA Founder, Design

Intelligence1

Consider the prediction:

Blockchain and smart con-

tract technologies will

transform the construction

industry. Similar statements

were made for Building

Information Modeling (BIM), an integrative project

design and data platform that has become ubiquitous

in the industry over the past several decades. Yet most

companies’ use of BIM has not come close to reaching

its full potential. Why? The main obstacle is a stubborn

adherence to inefcient processes and relationships that

is driven by risk aversion. The result is a complexity of

contracts among multiple parties and a lack of standard-

ization in processes that diminishes the value of BIM. In

other words, the same problems that the industry needs

to solve to improve its efciency have been obstacles to

its use of the new technologies designed to contribute to

the solution. What is different about blockchain? Block-

chain is a platform for collecting and sharing information

from disparate sources that creates a secure, valid, time-

stamped, and tamperproof record. For this reason, it has

the potential to solve core industry communications prob-

lems in a way the inconsistent sharing of data through

BIM has not. This article explores the questions: why has

BIM not achieved its full potential, how might blockchain

and smart contracts contribute to a solution, and what

role should construction attorneys play in the process?

Why the Value of BIM Has Not Been Realized

While in 2020 it is tempting to assume a uniform level of

familiarity with BIM and skip the denition, it’s worth

taking a breath to ask the question: What is BIM? BIM is a

data-rich, object-oriented, intelligent and paramet-

ric digital representation of the facility, from which

views and data appropriate to various users’ needs

can be extracted and analyzed ... to improve the

process of delivering the facility.2

In simple terms, BIM is a 3D model-based process that

is object-oriented, which means it is designed to capture

data about the objects incorporated into the design, from

dimensions, to manufacturing information, to warranty

and maintenance requirements. BIM creates a paramet-

ric digital representation of the facility, which means that

when one element of the design is changed, other ele-

ments of the design adjust automatically. Of course, a

model is useful for more than “the process of delivering

the facility.” When the model contains accurate “as-built”

information about the facility, it creates a “digital twin”

that can be used to test virtual commissioning and, when

connected with IoT (Internet of Things) sensors in the

building, can be used to run online diagnostics, allowing

the facilities managers to employ condition-based, rather

than reactive, maintenance.

The Promise of BIM

It is instructive to review some of the promises and pre-

dictions made about BIM in its early years and then look

at what has actually happened. In 2008, it was predicted

that BIM would:

•

enhance the ability of architects, engineers, and

other designers affordably to create numerous

design alternatives, instantly showing the effect on

aesthetics, cost, and operation and maintenance

(life cycle issues);

•

reduce the time and cost of preparing budgets

and schedules as well as reduce the time and cost

involved in design coordination and submittal

review;

•

reduce the errors, inconsistencies, and coordination

problems with design and improve the detection of

design omissions;

•

facilitate the retrieval of accurate information by

eld level personnel; and

•

provide an owner’s facilities personnel and sub-

sequent contractor rms with accurate, readily

Nancy Wiegers Greenwald