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Experts call for construction industry 'culture shift' to boost collaboration and improve efficiency

Out-Law News | 09 Jun 2016 | 4:56 pm | 2 min. read

UK construction requires a "fundamental culture shift" if it is to properly take advantage of the increased efficiencies and potential cost savings new technology could bring to the industry, according to a new report by Pinsent Masons, the law firm behind Out-Law.com.

According to the authors of the report, there is a disconnect between the desire for change continuously expressed by industry participants and the "inertia resulting from the comfort of familiar commercial and contractual structures which do not encourage teamworking or collaboration".

The report identifies the barriers that exist to more collaborative ways of working in the UK construction industry, and makes recommendations for change. These recommendations include greater use of building information modelling technology (BIM); changes to standard form contracts and key performance indicators (KPIs) to better incentivise collaboration rather than allocate risk and penalise poor performance; and new insurance models to reflect the different risk profiles of collaborative projects.

"As the demand for construction and infrastructure services increases, procurers and suppliers are looking at delivery structures which will provide not only sustainable, long-term value to the procurers, but also more consistent, better margins for contractors, supply chain members and professional teams," said construction law expert Martin Roberts, one of the authors of the report.

"As BIM and data management technology drives new approaches to the design and construction process, the need to replace traditional competitive procurement and tendering processes with more collaborative structures and arrangements becomes ever more acute. This report strikes at the heart of the complex dynamics surrounding these issues and points the way towards a more collaborative future," he said.

According to the report, the drive for greater collaboration in the construction industry dates back to the Latham and Egan reports, commissioned by the UK government in the 1990s. Although many of these recommendations had been taken forward by the government as part of its 'Construction 2025' strategy, the industry itself had been "reluctant to embrace" collaborative working principles.

The report references a late 2015 industry survey by NBS which showed use of 'traditional' procurement methodologies, such as fixed price or lump sum tenders, continuing to win out over more collaborative processes. The survey found that only 18% of respondents used any form of collaborative tools or techniques on all their projects, although 62% claimed to have collaborated on "all or some" of their projects during the previous year.

Barriers to more collaborative working identified by the authors of the report included a perception that collaboration was "likely to be more costly, time consuming and resource hungry", as well as a focus by construction clients on "short term goals and thinking". Similarly, there is a "reluctance" among clients and their advisers to engage in a process which they see as likely to leading them to lose their control over the project, according to the report.

This could be addressed through "strong and consistent leadership" from industry bodies and leading clients, as well as the creation of "centres of knowledge" for collaboration best practice and better training on the benefits of collaborative working for industry professionals, according to the report. It also recommends that the 'traditional' quantity surveyor role by developed to include "greater emphasis on long-term asset value and life cycle costs", and encouraging construction clients to devolve project management to a core project 'team'.

The report also recommends the continued use and development of BIM, with more clarity over how BIM will be used throughout the project to be decided at the outset. BIM involves the use of a computer-generated model to collect and manage information about the design, construction and operation of a project centrally, so that clients and subcontractors can make real-time changes to the same project.

Institution of Civil Engineers (ICE) chair Sir John Armitt, who contributed a foreword to the report, said that there was now a "general recognition" of the benefits of collaboration, particularly among participants in civil engineering projects.

"As the report makes clear there are a variety of contractual structures and approaches which can work but none will work without leadership from the client and collaboration and trust between all the parties," he said.

"It is not easy but without it the industry will not deliver value for money. Contractual structures which support and enhance a more collaborative working environment and reduce the scope for conflict must be the way forward," he said.