You don’t hear much about Sir John Egan these days. Integrated teams, lean construction, innovation … all the great doctrines he set out in Rethinking Construction back in 1998 have faded with the years. It’s not hard to see why.
The industry has spent the intervening decade scrambling to mobilise resources to cope with the sheer volume of work. The problems of getting hold of skilled people – and at the same time responding to the sustainability agenda – have overshadowed everything else. So, as we report this week, it’s no surprise that the targets Egan set down have not been met.
Does that matter? Well, some of them were a little fanciful: a 10% cut in time and cost year on year? Not likely, even if construction inflation wasn’t running at about 50% over the 10 years. In fact the industry only hit two targets: it recruited 300,000 workers by 2006 and increased its annual turnover and profit 10%. In 2000, the industry’s average margin was 4.4%; in 2007 it was 8.2%. Unfortunately, those results owed everything to a boom in demand and absolutely nothing to a revolution in productivity.
But if the figures don’t add up to a roaring success, they are evidence of progress. The health and safety statistics are better, as is output per worker. What’s more, the number of projects being completed when they’re supposed to is 58% compared with 36% in 2001, the first year the figures were gathered. The industry may not be perfect, but it is becoming more reliable.
There’s only so much figures can tell us. Everyone has a gut feeling about how much the industry has embraced modern industrial practice. Many influential managers have undergone Damascene conversions. Supermarkets that took 32 weeks to build 10 years ago can now be finished in 16. Partnering has allowed alliances to be forged and skills to be accumulated. Off-site construction has expanded. Health, highways, education and prisons have frameworks. Health and safety is a higher priority. The shame is that this has mostly happened at the largest firms: the extent to which best practice has filtered down to the remaining 90% of the industry is questionable – the purge by the OFT shows that old-fashioned tendering is still common.
So where now? Do we let the Egan principles slip into the history books? Or do we kickstart the process again? Well to a certain extent the Strategic Forum’s construction commitments are picking up the baton and the green agenda is pushing the technological envelope. But that said, we’re missing the passion of the Egan report. Although this became a little evangelical, and was rather crude in its assumption that erecting buildings could be equated to assembling cars, it did galvanize the industry. As we head towards trickier times don’t we need a bit of Egan’s shock therapy to make us rethink again? At the very least we need a bit of introspection – and to work out how we can work better as teams, trim waste, reduce costs and, for goodness sake, innovate.
Denise Chevin, editor