Guest Blog, Martin Lamb - Maple Consulting - The world is changing – will the construction industry?

There is much that the construction industry does well; building and maintaining the transport network, vital for business, constructing the built environment and so on. CEW highlights many examples of good practice.

That being said, there are many areas where the construction industry could improve to raise productivity, for example, wider uptake of Lean working, increased use of digital tools and adoption of new construction techniques.

I'm going to suggest something else that would improve performance in the following radical, controversial and provocative statement; if the construction industry treated their staff and supply chain better, they would see multiple benefits in productivity, employee satisfaction and bottom line. Crazy thinking, I know, but let me elaborate on why I think this may be so.

Large parts of the construction industry adopt management and operational practices that research has shown to be ineffective. Just this week, specialist trade bodies were reporting(1) that late payment remained endemic amongst tier 1 contractors, through payment dispute and delaying tactics. The same article also reported a large churn of Quantity Surveyors on projects, partly because they were uncomfortable with the practices, they were told to adopt by head office.

Let's take the internal side first. A Towers Watson Study(2) of 32,000 people found that only 35% of the workforce was highly engaged, covering the area of discretionary effort – 'want to do' rather than 'have to do'. Amazingly, 26% of the workforce were disengaged with the remaining 39% either unsupported or detached. The study also highlighted the large financial benefit of high engagement. Is the construction sector reflective of the global workforce? I would suggest it could be worse, as despite poor productivity and numerous initiatives aimed at improving this, relatively little progress at the sector level has been achieved, especially compared against productivity gains in other sectors.

Why might this be so? How motivated and engaged are people likely to be working in an industry that often seems adversarial? Take the QS churn mentioned above; screwing people over is hardly what many people look for in a career. Apart from the lack of engagement, there is also a direct financial implication in recruitment, getting them up to speed etc.

What about the supply chain? There is plenty of evidence of specialist contractors going under through late or non-payment; 75% of businesses that go bankrupt are profitable. Might it be better to work in a more collaborative manner, develop relationships, pay them what they are due, so they can invest in equipment and R&D to improve productivity. An engaged and supported sub-contractor is more likely to be more productive, develop more solutions and generally, go the extra mile.

Maybe this is being done more than I give credit for, or maybe you accept that's the way things are and they're not going to change, but I suggest they will. Firstly, as more millennials enter the workplace, leadership and management techniques need to move on accordingly. Research shows that the new generation of workers want purpose in what they do. Secondly, the construction industry is ripe for disruption, through technology, mechanisation, robotization and new practices. What worked before is unlikely to work in the future.

1. http://www.constructionenquirer.com/2019/11/25/major-contractors-accused-of-endemic-late-payment/
2. Towers Watson (2012). Global Workforce Study. Engagement at risk: Driving strong performance in a volatile global environment - https://www.towerswatson.com/Insights/IC-Types/Survey-Research-Results/2012/07/2012-Towers-Watson-Global-Workforce-Study