There are, however, a number of more minor revolutions going on in the background that illustrate why this deal is likely to work.
People are jumping roles all over the place. It is all a matter of who can add the best value to the process. A developer client, who is dedicated to design-and-build procurement, tells me he uses a contractor that grew from the roots of retail fit-out. "They understand the importance of handover and attention to detail. They aggressively break up the whole design and put it back together with time as a critical element. Main contractors are more dedicated to the erection and not the completion process." Similarly, M&E service providers are increasingly becoming main contractors if their delivery is critical. People are "niche jumping" whenever clients see the benefit.
Forgetting Egan and Latham for a moment (never easy), there is little doubt that clients are demanding the continuously improved performance that repeat procurement with the right partners is supposed to bring.
Not many contractors have responded successfully. Ray O'Rourke, however, has had that culture from the start. He has been developing direct client relationships for years and has always delivered in a tough, no-nonsense way. In each case, he has "broken down and rebuilt the design" – particularly on concrete frames. As a result, Ray – like Anderson – has won friends from top to bottom in this industry. I count myself as one, having worked as client, colleague and even a subbie of both.
Why the deal will work
So what is O'Rourke? A subcontractor? A specialist? An employer of loyal skilled labour? A main contractor able to deliver the full package? It has a great deal of all the above. It will bring value to Laing, provided that it can swallow the elephant without too much indigestion. It is here that the skills and experience of Anderson will be invaluable. O'Rourke does not have hordes of people at the centre, and the danger is that management may get bogged down in any problems it has inherited with the deal. How will it cope with the claims and works-in-progress it has inherited – however big the "dowry"? The new regime must make an impact from the start – this means change. Rover saw off the BMW influence. "A triumph of a culture of survival over a culture of success" was how a BMW director explained it to me. I am sure that O'Rourke will not make that mistake. He is sensitive to the importance of key people within our industry and whatever he does, he will build and maintain relationships.
Laing has good site people, is technically excellent, has a good reputation – but has not made a real profit in years. It needed better management
The firm O'Rourke is buying
What about the elephant – Laing itself? I find it difficult not to have mixed emotions. It is a good contractor but has never been consistent: the result of poor management culture at the top.
It is tagged with the Cardiff Millennium Stadium disaster and yet that contract was an example to all of how to complete a trophy asset on time and in the face of every conceivable problem – from a multiheaded client to a novated design that needed huge amounts of work.
As the services contractor on that site, I can say that Laing handled the crisis honestly, honourably and professionally throughout. Its financial pain is clear, but the project itself is a tribute to the company.
Laing has good site people, is technically excellent and has a good reputation in the field – but it has not made a real profit in years. It has always needed better management. Laing's chief executive, Brian May, has a good reputation, but has not had the time to turn the ship around – with Ray he may have the chance.
This purchase will not herald large change in the UK industry. There are no other Laings around and few, if any, Ray O'Rourkes. No company has grown from scratch to national giant status since the Second World War, because clients have never given beginners the chance to grow.
