Key Industry Publications

Introduction

Over the years, the construction industry has faced many calls for change. Clients have voiced concerns about the impact of inefficient processes and waste on their commercial performance. Health and safety has emerged as a major concern, and climate change and the need for buildings to be more environmentally friendly has challenged the industry to change once again.

Background

From the end of the Second World War, reports identified that a fragmented industry lead to a poor quality product and warned of the danger of adversarial relationships within project teams. Subsequent reports including the Emmerson report (1962) and Banwell report (1964) commented on the need to improve costs, time, quality and fitness for end users. Both identified the need to improve trust, foster a collaborative culture and eliminate adversarial relationships. The Finniston Report (1980) examined engineering specifically, focused largely on the capability of the industry and commented on the low status of the engineering profession in society, recommending new educational standards and a National Engineering Authority. Numerous reports have been produced since then but a few key reports made a large impact and set the change agenda for the industry.

Constructing the Team (Latham)

Constructing the Team (1994), commonly known as the Latham report set the starting point for the most recent change agenda in the industry. The widespread growth of partnering and subsequently collaborative working can be traced to Latham. He stated that widespread adoption of collaborative working practices could achieve a 30% real cost saving within five years. Latham also recognised the significant role of the client in achieving successful construction projects. There was patchy take up of the recommendations in the Latham report, hindered in part by public sector procurement rules.
Constructing the Team (Latham)

Rethinking Construction (‘Egan’)

The slow uptake of good practice in partnering, particularly beyond the first tier of the supply chain, was amongst the factors which persuaded the incoming Labour government in 1997 to ask Sir John Egan, Chief Executive of BAA (British Airports Authority) and formerly of Jaguar, to undertake a new and more radical review of the industry. With the Task Force membership drawn heavily from manufacturing and larger clients of the industry, their 1998 report pointed strongly towards ‘lean thinking’. It identified five drivers for change – committed leadership, focus on the customer, product team integration, quality driven agenda, commitment to people, and four process improvements – product development, partnering the supply chain, project implementation and production of components. It identified targets for improvement in areas such as construction time, cost and predictability and accident reduction.
Rethinking Construction (‘Egan’)

Accelerating Change

In September 2002 the Strategic Forum for Construction, which succeeded the Construction Industry Board in July 2001, and initially chaired by Egan, published a manifesto for the next phase of change in the industry. Accelerating Change (2002) set a headline target for 20% of projects to be undertaken by integrated teams and supply chains by the end of 2004 and 50% by the end of 2007. The rationale was that “the major long-term benefit from integrated team working is the potential for relationship continuity. Integrated teams should be based, wherever possible, on strategic partnering. Knowledge and expertise can then be transferred more effectively from one project to the next. Whilst this is clearly of benefit to repeat clients, the benefits to one-off clients should not be ignored, as such teams will be better placed to offer them an improved service based on past experience, the ability to innovate, and through the development of a culture of continuous improvement.”
Accelerating Change

Achieving Excellence

Government’s traditional approach of awarding contracts to the lowest bidder in the name of value-for-money, and then reaping the harvest of claims and overspend, began to be seriously questioned by senior civil servants almost as soon as the Latham Report was published. A series of further reports concluded that Government procurement was partly to blame for the poor performance of the industry and made recommendations for change across government. The key barrier appeared to be public sector procurement rules. This client leadership from the public sector has been a critical success factor of the last twelve years’ efforts. The Government initiative Achieving Excellence (1999) sought to promote the construction change agenda across government spending departments. Targets included the use of partnering teamwork and the development of longterm relationships.
Achieving Excellence

National Audit Office

Modernising Construction (2001), was published by the National Audit Office to improve public sector procurement and management of new construction, refurbishment and repair and maintenance. It made a number of recommendations for government departments and the construction industry, including more coordination between improvement initiatives, demonstration projects that show true innovation, more sophisticated performance measures, better good practice dissemination, more training and better use of innovation. The National Audit Office produced a subsequent report, Improving Public Services Through Better Construction (2005) which traced the progress made by the various departments since 2001.
Modernising Construction (2001)
Improving Public Services Through Better Construction (2005)

Be Valuable

Concern over understanding of “value” led Constructing Excellence to publish Be Valuable. This defined the concept of value as being what you get over what you give. It also suggests that the structure of the industry prevents it from engaging with the whole life cycle of a building. Clients are removed from occupiers, end users and facilities managers and therefore take little interest in the operational phase of a building. Built environments should be seen as working assets rather than as physical artifacts.
Be Valuable

Callcutt Review

The Callcutt Review of Housebuilding Delivery was published in 2007. The issue of land supply and management was identified as key to delivering stretching Government housebuilding ambitions and the target was set for all new homes to be zero carbon by 2016. It made recommendations to Government for different land supply and management strategies which would increase the rate of housebuilding delivery. It also recommended more stringent quality standards based on customer satisfaction and also to improve skills in the sector.
Callcutt Review

Strategy for Sustainable Construction

Awareness of the need to mitigate harm from global warming grew from the early 1990s. In 2008, the Climate Change Act was passed and contained legally binding CO2 reduction targets of 80% by 2050. The Government and industry recognised the responsibility that the built environment had for much of these emissions and launched the Strategy for Sustainable Construction (2008). The strategy aimed to provide clarity around the existing policy framework and signal the future direction of Government policy. Divided into two sections: the “Ends” and the “Means”, the strategy contains targets for the industry on all elements of sustainability from climate change to material selection. The construction industry was therefore challenged not only to deliver value for money, safe construction sites and fit for purpose buildings but also to reduce the environmental impact of the built environment in its construction and operation. A progress report was published in September 2009.
Strategy for Sustainable Construction
Strategy for Sustainable Construction Progress report

Construction Matters

In March 2007, the Trade and Industry Committee (subsequently renamed the Business and Enterprise Committee) launched a major inquiry into the UK’s construction industry, challenging the industry to demonstrate its strengths but also to highlight areas where there was need for improvement and the role the Government could play in achieving this. Their report Construction Matters (2008) outlined the need for Government leadership both at the strategic level and as client. It recommended that there should be a role that both government and industry accept as having overall responsibility for construction – a Chief Construction Adviser.
Construction Matters

Equal Partners

In 2008 the Construction Clients’ Group and Business Vantage conducted a study which found that despite the economic downturn, the majority of private sector clients continued to maintain a focus on value and desire for collaborative working.
Equal Partners

Never Waste a Good Crisis

In 2009 a new report from Constructing Excellence authored by Andrew Wolstenholme was released. The report looked to determine the level of industry progress since Rethinking Construction and define the improvement agenda for the next decade. The Report found that whilst the industry was moving in the right direction, it had fallen well shorts of Egan’s targets. Both safety and profitability had taken reasonable steps forward, but progress on all other areas had been disappointing with an annual improvement of less than 3%. The ‘blockers’ identified were business models based on short term cycles, a fragmented industry, poor integration in the supply chain, and a lack of strategic commitment at senior management and Government levels. The review also set out a future agenda for UK construction, including some quick fixes, and identified one the greatest challenges for the sector as being the delivery of a built environment that supports the creation of a low carbon economy.
Never Waste a Good Crisis

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