In uncertain and challenging times, having access to accurate, reliable and up-to-date information is vital in helping project teams react and adapt to often quickly changing conditions on site
The past year has been anything but “business as usual” for everyone in architecture, engineering and construction. Covid-19 has meant more remote working, an end to face-to-face meetings and enforced social distancing on site; major changes to our working lives that had to be adapted to mostly for the first time and largely at very short notice.
Against this backdrop, contractors have had to contend with significant turbulence in the supply chain, with shutdowns at factories at home and abroad causing backlogs, delays and shortages of materials, equipment and parts, leading to soaring prices.
However, as the Construction Products Association and Builders Merchants Federation warned in a recent joint statement, the ongoing impact of Covid-19 is just one of several factors in a complex picture.
Timber, for example, is experiencing a global imbalance in supply and demand. European production saw a sharp drop in 2020 while demand is rocketing in the US and China, where softwood imports have reached their highest ever levels. The UK should prepare for rising prices to continue, the CPA and BMF said.
Meanwhile, global demand for steel is resulting in shortages, backlogs and increased prices; China became a net importer of steel for the first time in over a decade in Q3 2020.
Elsewhere, PIR/PUR insulation producers are experiencing historically high prices for several raw materials against a backdrop of strong international demand, while reduced production and high domestic demand have extended the lead times for concrete roofing tiles.
At the same time, the global logistics industry has been under immense pressure due to Covid, resulting in surging costs for building materials such as screws, tools and sanitaryware shipped in containers, particularly from the Far East.
Continued bottlenecks of container equipment between the UK, the EU and Asia have seen carriers reduce routes to the UK by as much as 30%. At the same time, prices per container have risen by more 650%, without space guarantee. Containers that cost $2,100 in Q1 2020 are now costing between $15,000 and $30,000.
Post-Brexit border issues are also impacting the supply chain. The UK government’s trade agreement with the EU was described as a “welcome relief” for the construction industry when it was signed in December, as it meant no tariffs, quotas or customs duties and would allow contractors to forecast the availability and cost of products imported from the continent.
However, the latest figures from the Office for National Statistics suggest a less than smooth transition to the new relationship between the UK and its largest trading partner. Imports of goods from the EU fell by 28.8% (£6.6bn) in January compared with a year earlier. Exports to the EU plunged by 40.6% (£5.6bn). Overall, January saw the biggest decline in British trade since records began in 1997.
The government said a “unique combination of factors” including Covid lockdowns, stockpiling and businesses adjusting to the new trading relationship meant it was inevitable that exports would fall in January and the ONS data “does not reflect the overall EU-UK trading relationship post-Brexit”.
Nevertheless, all of these factors serve to underline the importance, in this uncertainty and highly changeable business environment, of keeping on top of what you can directly control on a construction project – and ensuring you can react quickly and effectively to the impact of what lies outside that control.
End-to-end visibility
Efficiency and productivity are longstanding issues for construction, from housebuilding and civils to demolition, road and rail. The fact of the matter is that for too long, the industry has allowed itself to be hamstrung by siloed working, fragmented data and an adversarial approach to projects.
Bad organisational structure, poor communication, a lack of clear responsibility and accountability and out-of-date or unreliable data leads to weak performance management, unresponsive decision making and a “snowball effect” of supply issues, delivery problems or cost changes that occur once a project is underway not being dealt with effectively. All of this means too many construction projects are over deadline, over budget – and below specifications.
These practices are not tolerated in other manufacturing sectors, such as automotive and aerospace, and we must challenge ourselves to do better.
By its very nature, construction is long-term – houses, hospitals, schools and infrastructure must last generations – but the industry, by and large, does not think long term. With notoriously thin margins, the emphasis is often on winning a contract, getting it done as fast and cheap as possible, and repeat.
In the last few years, however, things have started to change. Landmark reports like Sir John Egan’s Rethinking Construction and Mark Farmer’s Modernise or Die set the direction of travel for a more sustainable, successful industry through the embracing of innovation and the widespread adoption of technology.
More recently, the landmark Hackitt Review of Building Regulations and fire safety, with its “golden thread of information” and subsequent government efforts to ratchet up industry standards, such as the recently announced national regulator for building materials, underline the need to end the “race to the bottom” of quick and cheap in favour of a long-term focus on the lifecycle of a built asset.
That is why end-to-end visibility, from initial estimates and planning to supply chain operation and what’s actually happening on site, as it’s happening, has never been more important. It has been talked about as the future of the construction industry; it could and should be the here and now.
A single source of truth
The phrase “single source of truth” is often associated with construction tech such as Building Information Modelling but, in reality, it is something that everyone in the industry should care about and can apply to any project.
In short, a single source of truth means having operating data that everyone working on a scheme agrees is trusted and accurate It is more than just good document management; it means project teams working at different sites, at the office or on site, sometimes even on other sides of the world, know they are working from the right data, without duplication, which helps to reduce mistakes and errors, improves trust and transparency, and mitigates risk.
But how can this be achieved? Most construction projects have information coming in from multiple sources, whether it’s project plans, emails, material specifications, workforce data and so on. When this data is stored in separate databases and systems, it increases the chance of duplication or even conflict.
How tech can help
Technology holds the key to unlocking the efficiency gains offered by a single source of truth. Integrated applications and cloud storage break down the barriers of the traditionally fragmented supply chain of manufacturers, distributors and contractors, allowing field capture of information using consistent standards that is stored in the cloud, allowing project managers and directors to track and analyse it, all synched in real-time.
It’s not just making sure your teams on site are working from the latest set of plans. It can create a more collaborative environment for communication – particularly valuable at a time when face-to-face meetings are impossible.
Instead of vital project information being buried in a subcontractor’s emails, for example, it is housed within the system, with all permitted stakeholders able to locate it, ensuring they are up to date and avoiding potentially costly delays.
Meanwhile, mobile apps mean that site managers can control purchase requisitions, update goods received and timesheets without having to return to the office, with this information instantly updating the overall project dashboards for the teams away from site.
Crucially, integrated mobile and cloud technology means key job costing information at multiple levels, such as plant, materials, labour, subcontractors and overheads, is captured – and updated for each activity – as the project progresses.
Ultimately, this live site and financial information enables that end-to-end visibility on how a project is running and enables more responsive decision-making while ensuring problems don’t “snowball” and allowing risk mitigation at the earliest opportunity.
Conclusion
Construction is often viewed as a conservative with a small ‘c’, even staid, industry reluctant to change its ways, even when the challenges and frustrations of fragmented supply chains, avoidable delays and walking a tightrope of razor thin margins are clear – and widely acknowledged.
Yet there are many in the industry already embracing digital transformation and better ways of working through technology – and they are not looking back.
Change can be daunting but with the whole construction industry facing ever-higher demands for quality, safety and performance of built assets, knowing the true performance and cost of a project is becoming ever more important. Visibility is everything.
Sean Williams
Business development manager
The Access Group
Tel: 07887 538984
sean.williams@theaccessgroup.com
Please note: this is a commercial profile.
