Productivity in the UK construction industry is at an abysmal level according to Richard Ogden, Chairman of the Buildoffsite organisation. He explains how we should transform it here…

I am going to let you in on secret – albeit a not very well kept secret. Productivity in the UK construction industry is, for the most part, abysmal, and despite the arrival of digital technology, the wonders of information modelling and constant hard work by some incredibly talented people, the performance of the industry is getting worse – not better. All the government inspired industry reviews that have taken place over decades have made not a scrap of difference.

I suppose that the industry can take some satisfaction from the fact the position in the UK construction industry is not that much different to the position across the rest of the world. But frankly, a charge of being equally bad is hardly the sort of end-of-term report that any industry and its clients can be comfortable about.

It is clear that as currently structured, the construction industry will remain incapable of reform. Unlike the changes that took place in other parts of UK manufacturing a generation ago, we cannot look to international competition to force the pace of a productivity and value focused agenda. I wish it were that simple.

So how has this situation arisen and what is to be done about it? Frankly there are very many in the industry who will shrug their shoulders and take comfort in the position that this is just the way things are. A consequence of operating in an industry where just about every project is planned and delivered as a one-off. It’s where a hierarchy applies with clients, their agents, and main contractors are at the top and sub-contractors and suppliers at the bottom of the pile. Where resources for project management are spread too thinly. Where clients and their agents change their minds right up to and beyond any sensible point at which design-freeze should have taken place. Where waste of materials on site runs at between 10 – 20 percent, and this is regarded as normal and acceptable. Where on almost all jobs the actual delivery is fragmented across a diverse supply chain of works and package contractors with incoherent timetabling and logistics — and in some parts of the UK the almost impossibility of getting hold of, and retaining, good quality traditional labour at any price. Where on supposed completion, buildings may well be riddled with defects.

Let us not forget that initially the client, but ultimately all of us, end up paying the price for this strategic failure of competence.

Certainly these challenges impact on large parts of the industry but rather than simply adopt hand-wringing, it might make for a better strategy for decision takers to be prepared to tear up the rule book and look for a radically different approach which does not admit most, if not all of these difficulties.

Perhaps the starting point for change is where a client (and it will usually be a client) is simply no longer prepared to accept that there can’t be a better way. A refusal to accept that the manufacturing excellence and the levels of productivity and process efficiency that apply in just about all other manufacturing industries should not apply in equal measure to construction. That the industry has created a Gordian Knot for itself regarding the degree of difficulty in adopting better working practices does not mean that there is not a better way

As you know, I am unapologetic about my commitment to the business and project case for the increased use of offsite manufactured components to transform the industry from one that constructs on-site, to one that assembles buildings on-site. A recognition that in order to save the industry from itself we need to industrialise construction processes and remove as much labour as possible from sites. My personal ambition is to help bring about a transformation in construction practice whereby assembling using offsite components becomes the accepted norm, and building on-site using traditional methods is very much the exception. OK, we have a long way to go to bring about this reality but the case for change is increasingly powerful and increasingly understood.

I would not claim that simply shifting to the use of offsite solutions in place of traditional forms of construction represents a complete answer to the productivity conundrum. Although an understanding of the process improvements that the use of offsite solutions can help unlock, is certainly something that can make a real difference both to projects and to the competence and capacity of design and construction businesses.

The process management techniques that leading-edge manufacturing industries have implemented to deliver massive improvements in productivity have an equal place if we are to transform the construction industry. This includes the use of information modelling software – provided this is used intelligently. It includes the application of Design for Manufacturing and Assembly techniques that ensure issues associated with buildability on-site are properly considered and actioned from the outset. Also highly relevant is the application of lean techniques to identify and deal with inefficiencies at the earliest stage of the project.

Lean thinking by definition is about delivering more with less. More value with less effort or more profit with fewer resources applied.

One of the impediments to the effective application of lean thinking is an all-pervading fear of failure. Other industries have correctly spotted that failure is the biggest source of opportunity for learning and innovation. There is evidence to show that we fail daily around 80% of the time on construction projects, whether it is on-site or in a design office. In this context, failure represents the percentage of tasks we complete on time against the plan. This is not common knowledge as it is something that is not usually measured.

In turn, this lack of focus tends to get in the way of important learning. When problems occur, we deal with the effect and hardly ever address the cause. This means problems will inevitably recur and so on – nothing will have been learned.

Many people in the industry still hold to the belief that quality can be improved by increasing levels of supervision. World-class manufacturing companies discovered years ago that quality cannot be inspected into a product or service, but has to be built in through effective processes and learning loops.

The lessons from the leading edge will be profound for the construction industry and will include: creating accountability at the front line; merging the role of the manager and operator and; manufacturing and installation methods that involve working on something continuously until completed.

This represents just the start of the revolution that the construction industry needs to sign up to if we are ever going to see a transformation in productivity and right first-time quality.

A new lexicon of terminology that many in the industry will find strange. An end to a macho blame game culture and the adoption of techniques to enable businesses to learn and prosper from mistakes and creating businesses that can achieve continuous improvement and can motivate and enthuse the workforce.

I recognise that from the viewpoint of the construction industry much of this will sound fanciful. However, from the viewpoint of say, the automotive industry, this ambition will sound simplistic and feeble. It shows us just how far construction has fallen behind the rest of industry and how far we need to travel. We need to start out on this journey sooner rather than later, and we need to harness the enlightened self-interest of industry and client leaders to help show us the way.

Google, Tesla, Amazon, and Microsoft would not work like this. So who is going to be first to the post in implementing radical change in construction? Where is the Henry Ford of construction?

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Richard Ogden
Chairman
Buildoffsite
Tel: +44 (0)20 7549 3306
info@buildoffsite.com
www.buildoffsite.com
Twitter @buildoffsite