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How will the Egan Report affect us? Change is going to happen - it is up to us whether we want to be part of the new order Constructing change

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On 3 November, 350 of us gathered to hear the Deputy Prime Minister, John Egan, the Paymaster General and the Minister for Construction exhort us to embrace radical and continuous change in the construction industry. This was Egan's last paragraph:

'To summarise, the Task Force wishes to emphasise that we are not inviting uk construction to look at what it does already and do it better; we are asking the industry and Government to join with major clients to do it entirely differently. What we are proposing is a radical change in the way we build. We wish to see, within five years, the construction industry deliver its products to its customers in the same way as the best consumer- led manufacturing and service industries. To achieve the dramatic increases in efficiency and quality that are both possible and necessary we must all rethink construction.'

If sometimes Egan hectors, he nevertheless hits a lot of buttons. I was impressed when I heard him say at the riba about a year ago that 'in any sector only one company can be the cheapest, the rest of us have to design our way to the top'.

As an architect I have immense trouble getting my colleagues to accept that they are part of an industry, although I am delighted that the riba is trying to move architecture from the Arts Council and dcms to the detr where the rest of our industry operates.

I am pleased that at least one of Egan's drivers for change is respect for people. Achieving that requires a cultural change of revolutionary proportions, away from what I call the East India Company Syndrome - devising bureaucratic structures to prevent the other party cheating you. Lean thinkers call such structures 'muda', or waste, ie activities that do not add value. We should all see this as a challenge - it even makes me think about my practice being paid on a value-added basis.

Latham 1994

I am quite certain that Egan could have got this far without the preparatory work of Latham who, although advocating a process-oriented team approach and a belief in an ethic of fair trading as better business had, I have to say, little apparent understanding of the value of good design or the iterative nature of the design process. Nevertheless, it resulted in the negotiation of new codes of practice and promoted an act of parliament. Perhaps Latham's real legacy is a political structure articulating the demand and supply sides in the form of a forum for the industry, with the Construction Industry Council as the pivot for other groups in the Construction Industry Board.

Egan 1998

Following the formation of his new mega-department, the Deputy Prime Minister was in a hurry to get better value for money out of construction and so invited his fellow Jaguar-driver to propose some radical, client- led changes based on the experience of baa and other progressive construction clients.

Clients see our work as too expensive, slow, dangerous, and poor quality, and think that we are more interested in ourselves than in our customers. More specific problems include:

designers designing for themselves and not for the customer

a lack of investment in research/ feedback from consumers

chaotic procurement arrangements

little understanding of life-cycle costing

little or no measurement of performance

lack of standardisation

little involvement of sub-contractors in the design process

designing every project as a prototype

confrontational attitudes

£1 billion of defects built each year.

Egan identifies five drivers of change:

committed leadership

customer focus

integration of the process and the team


commitment to people.

He then identifies four complementary elements, all involving measurement and innovation:

product development - understanding the client's needs and then exceeding them

project implementation - setting performance targets, measuring performance and continuous improvement

partnering the supply chain - value-based sourcing and managing the process both up and down the supply chain

production of components - designing for assembly, just-in-time delivery.

I find this exciting because I am fed up with the increasing 'muda' in my professional life; with the hugely expensive and pointless legal gymnastics and handing my clients unacceptably badly built buildings.

Let us set aside our Anglo-Saxon cynicism and gripes. I like 'Rethinking Construction' for:

the Demonstration Projects - a brilliant device for catching the innovators

the challenge of zero defects

its recognition of the need for cultural change

its respect for the workforce and for end-users

its use of lean thinking as an approach to construction

the obligation to share information

its approval of performance indicators in lieu of competitive tendering

the use of feedback as an essential part of design

the encouragement of feedback from users/customers

its understanding that good design is essential and needs time.

So what's happening?

'Rethinking Construction' proposed a 'movement for change' (a club of individuals, not organisations), and a 'knowledge centre', that never quite did get defined. To these detr added a housing forum and its 'combatting cowboys' campaign. A steering group was set up comprising John Egan, Geoffrey Robinson, Nick Raynsford and Tony Jackson.

A secretariat has been set up in detr under Nigel Dorling to run the movement for change. With help from industry they will process the demonstration projects, which need to explain exactly what they are demonstrating. However there is a difference between illustrative projects and those that propose and test more comprehensive changes.

The Construction Best Practice Programme, dealing with dissemination of ideas, is being launched today (26 November). Associated with this is the concept of a virtual knowledge exchange.

The housing forum will be launched on 3 December, although there are concerns about the way control has been handed to the Housing Corporation at the expense of the private sector. The paymaster general, Geoffrey Robinson, will clarify our obligations under the ec competition regulations. There will be a national conference in June to see how we are getting on.

Where will this lead us?

There is an astonishing level of government commitment to change, which is important because, asthe client for half our work, the government must lead the process of change. It is equally important to realise that the movement for change and the knowledge centre are aimed at raising the average by leading from the front/top.

I want to see links to three other areas of government construction activity:

the Kyoto protocol and sustainability - culture of measurement

health and safety - a pre-condition

training - an obligation.

Everybody in the industry lives for, and by, making things, but too many of us are too often frustrated by the result. I hope that the 'Rethinking Construction' hurricane will sweep us towards more creative ways of making those things for the greater benefit of others.

This is an edited version of a talk given to the 'Designing the Customer Experience' forum at the riba on 11 November.

Robin Nicholson is a director of Edward Cullinan Architects and chairman of the Construction Industry Council

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