The construction industry could increase its efficiency by learning from the car manufacturers. But is it ready to?
When Sir John Egan announced that 'there is deep concern that the industry as a whole is underachieving', everyone recognised a certain understated truth in his comments.
The construction industry has long been regarded as somewhat dated in operational terms. No onsite automation to speak of; a philistine relationship with the ways of e-technology; labour-intensive production techniques; and a fragmented and bureaucratic chain of command. Sounds familiar? It ought to, because it has been this way for a long, long time.
Everybody who has eyes to see - whether on the outside or the inside - comments sagely about the nature of the problem and the need for a radical overhaul of the inefficiencies of the system.
The challenge for the building industry has been to try and come up with satisfactory ways of cutting through the historically fractious industrial relations of the construction sector.
In the midst of all this confusion there is some real research going on looking at how to solve it. The Building Research Establishment (BRE) is currently collaborating with Cranfield University on a project called Construction COGENT (from COdevelopment reGENeration Tool).
Co-development is defined as the process of 'meeting the same goals synchronously'. This involves creating a management and operational ethos of openness, enabling a range of inputs to be made to the design throughout the period of active development. At the moment it is only applicable up to the point when a scheme goes on site. However, this 'culture of co-operation', as Vassos Chrysostomou, director of the BRE's Construction Performance Improvement Centre, describes it, is the polar opposite of brainstorming sessions at milestones in the design process.
Construction COGENT is the name given to the implementation of 'concurrent engineering', - a mechanism for inputting queries and comments with the design team - so that the inputs and consequences are ironed out concurrently. This project will develop Cranfield's work with Nissan's European Technology Centre, which was aimed at reducing design costs and build time in the automotive industry.
The results of Nissan's experiments have been analysed with specific reference to applications in the construction sector to form the basis of a series of trial projects.
These projects are the first time that an application of real, conscious, concurrent engineering has been used in construction.
Nissan has been involved with the COGENT reappraisal of its design and supply-chain processes for five years, at a cost of £3 million. Effectively working with 100 suppliers' sites, the COGENT project with Nissan has introduced appraisals and an improvement-measuring scheme 'to communicate Nissan's goals in working with them'.
Applying COGENT performance criteria has resulted in a 30 per cent overall reduction in the design time and component costs, which tend to make up about 70 per cent of the cost of an automobile (30 per cent was the target put forward by Egan for the construction industry). The news service 'Just-Auto' announced in 1999 that Nissan's Almeira model was developed 25 per cent faster than the Primera due to the production and research and development improvements of the COGENT project.
However, the powerful hold that the car manufacturers have over their suppliers and their own workforce also enables ongoing, annual cost reductions to work effectively, (although not to the satisfaction of all participants). It will prove to be a more difficult task in construction because of its historically fragmented nature.
Construction COGENT aims to assess the whole design process throughout the project, and recommends total supply chain involvement in the assessment procedures as early as possible. It examines the standard linear decision processes of construction - the tendency for architects to finalise drawings before handing them on to, say, the QS, who then raises queries which have to be readdressed by the architect - a to and fro, rather than a circular, process.
This simple example, which omits all the other multifarious parties to a design and manufacture process, still goes to show the time wasted in non-harmonised decision and production efforts. If only the QS had sat in and told the architect that the cladding, for example, would take the scheme over budget, lots of time might have been saved. What if the glazing supplier was able to make the design team aware of its preferences for manufacture dates, or the roofer was able to explain its worries about the access-difficulties of a given design? Professor Steve Evans, of Cransfield University's International Ecotechnology Research Centre says that most of the procedures are 'common sense, but not common'.
Construction COGENT is effectively a management tool for engaging all participants and providing a coherent starting point for a partnered working environment.
Professor Evans says that co-engineering (from which Construction COGENT derives its principles) is about 'the delivery of better, cheaper faster products to market by a lean way of working, using multidiscipline teams, right-first-time methods and parallel processing activities to continuously consider all constraints'. As the spiel suggests, it is reminiscent of a Tom Peters management video, but it seems to reap rewards.
Vassos Chrysostomou is straightforward about the objectives. 'It is about getting products to the market faster, ' he says. 'To do that, we have to challenge the culture within the industry. We need a consistent approach and this is what we learned in the car industry application of COGENT.We've played around with these kinds of ideas in the construction industry for years, but this is the first time that we have captured the knowledge. We want all the stakeholders - clients, architects, engineers, contractors, suppliers, planners, etc - to be involved so that the project benefits from their interdependency. This is a way of life, not a paper exercise.'
Worries that building up coherent teams might undermine the basis for a competitive edge gets short shrift from Chrysostomou. 'This has nothing to do with costs, ' he says. 'In fact, it is not even job-specific. It is a process that should be in place before a project is put together and the lessons learned from previous jobs can very easily be accommodated into the next, because of the transparency of the team organisation.'
He suggests that the team can get together and decide the people and processes necessary for designing an office in the absence of a commission, thus being better prepared when such a commission turns up. It is assumed that concurrent engineering is a process whereby the resulting tender costs should reflect the efficiency of the team.
In terms of the prevalence of litigation within the industry, which could undermine the fundamental principle of cooperation, Chrysostomou is working on moving away from PI insurance and on to projectbased insurance. In this scenario, one-job insurance schemes will be assessed on the basis of the teams engaged to carry them out. Obviously, a coherent team with a proven track record in co-developmental working will attract lower premiums.
The desire for technology transfers between sectors has recently been talked up, but learning from, and adapting, technological advances across sectors, has always occurred in some shape or form. The defence industry, in particular, has always provided costly research and development at a discount to the private sector In terms of man management, however, the government-sponsored Movement for Innovation (M4I), continues to bang on about the need for construction professionals to talk to one another and develop a harmonious working relationship with contractors, for example - as if this is a new idea. (There is no equivalent debate about the potential erosion of the competitive edge caused by the cavalier use of partnering arrangements. ) But it is the design stage processes which are attracting interest in providing most efficiency gains and cost savings. Involving suppliers and subcontractors in the process is the ideal. The optimum benefit model indicates that more consideration given in the design stages pays dividends on site.
Phase 1 of the Construction COGENT research has been completed and assessed. It involved a feasibility analysis of the key areas of an actual project in terms of costliness, and assessing how these areas can be improved to bring down costs in particular areas, and in the job overall. Partners in the trial were Crown House Engineering and Slough Estates, both major development companies which had to be convinced to invest time in a scheme which would extend the front-end design time on the promises of programme gains in the long term.
Apparently these clients were sceptical, but as Hugh Rogers, general manager of Construction Slough Estates, says: 'This is a risk that we cannot risk not to take.' After six months of trial and appraisal, they are converts.
John Tebbit, industry affairs director of the Construction Products Association, says: 'To many, Sir John Egan's report, Rethinking Construction, was seen to have little or no direct relevance to the role of construction product manufacturers and suppliers in the construction process. In reality, nothing could be further from the truth. The targets that Sir John set for reducing construction time and cost, and improving quality, will only be achieved if manufacturers and suppliers are at the heart of this new agenda.'
Building Research Establishment, Construction COGENT (and for information on taking part in the implementation stage), contact Peter Deere, tel 020 8761 9831 or 01923 664127 The Construction Products Association's Network Club, John Tebbit tel 020 7323 3770, e-mail jtebbit@constprod. org. uk Cranfield University, COGENT, Steve Evans, e-mail: steve. evans@cranfield. ac. uk