Industry

13 JAN 2020

CONSTRUCTION SECTOR FAILING TO LEARN FROM PAST PROJECTS, ACCORDING TO NEW SURVEY

Major real estate and infrastructure clients are failing to measure performance and implement lessons learnt from programme reviews, missing the opportunity to improve delivery and ensure cost efficiencies, according to analysis of the UK construction sector by Turner & Townsend

The new survey by the global professional services company has found that 48% of key client programmes across the industry do not consistently measure performance. In addition, 61% do not take action to review procurement processes in light of lessons learnt from past projects.

The study into procurement approaches across a multitude of sectors focused on capable owners, governance, organisation, integration and digital transformation. These align with the key pillars of Project 13, an initiative from the Infrastructure Client Group (ICG) which is supported by the Institution of Civil Engineers and designed to help UK construction move from a transactional to an enterprise approach to boost productivity. 

A key challenge exists around the implementation of innovative digital technologies which as a result hinders client competitiveness. Close to half of those surveyed said they did not have an efficient data management system in place.

Gareth Poole, director of contract services at Turner & Townsend, said: “Successful procurement is rooted in consistent measurement of performance, embracing and implementation of technologies, effective risk management and supply chain collaboration. We need to be adopting the new approach to performance measurement outlined in Project 13 – embedding a system to provide information to continuously measure ‘as delivered’ and ‘as operated’ performance against customer outcomes.”

Interestingly, these calls for greater take-up of Project 13 tools come just as ACE chief executive Hannah Vickers made a call this week for the industry to be wary of the hype around single solutions like Project 13 clouding judgement as it seeks to find ways of improving the delivery of infrastructure projects.

Over half of clients in the sector are also failing to offer effective incentives to suppliers based on volume and performance and nearly three quarters do not operate commercial incentive models to improve supply chain efficiency. Turner & Townsend points to this incentivisation as key to driving performance and innovation and maximising cash flow.

By contrast, risk management – one of the six commercial principles of Project 13 – appears better understood and adopted across the industry. 60% of respondents are confident that their contracts set out how risks should be identified and managed during the life cycle of a project. 

The study also highlighted a dramatic improvement in attitude towards cross-industry collaboration – with 69% of clients in the industry now seeking to foster open and honest relationships within the supply chain, a significant shift from the 27% of respondents who believed such collaboration would enhance performance of the industry when asked last year.

Gareth Poole added: “Our research highlighted a significant shift in attitudes towards collaboration, but there is improvement to be made in performance measurement and the monitoring of lessons learned so that revised practices can be utilised in future procurements, particularly those identified as high risk. This is particularly important given the current state of market volatility and political uncertainty.”

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