Solving the Construction Productivity Puzzle
Productivity (or perhaps the lack of it) has long been recognised as one of the biggest problems facing the construction industry. This isn’t unique to the UK. According to McKinsey, global construction productivity has improved by 1% per annum over the past two decades.
For comparison, manufacturing has improved productivity by 3.6% pa over the same period. Additionally, we shouldn’t forget that manufacturers started from a much more productive baseline.
Other sectors have found it easier to apply lean principles and automation to their processes. Meanwhile, construction has also continued to suffer from labour shortages and quality issues that have knock-on effects of productivity.
Let’s put history to one side and think about the opportunities. Imagine if construction could get close to the productivity gains of manufacturing. Suddenly there would be less anxiety over project costs and margins. We’d be creating enough value to satisfy everyone.
We Know How to Improve Productivity
The good news is that it’s all perfectly possible. Unlike the history of construction projects, faster and cheaper doesn’t mean lower quality if you select the right methods.
That is the exciting crossroads that UK construction stands at right now; Which way will we turn?
Without changing methods and rethinking the relationships between clients, contractors and supply chains, productivity will be the wall we continue to bang our heads against. In fact, things could get worse as labour shortages tighten, material costs rise and new demands such as net zero come into play.
The transition to higher productivity can be as simple as choosing the right approach from the outset of the project. Osborne is one of several firms that has developed expertise in delivering projects using modern methods of construction.
Experience matters. Project planning and sequencing are fundamentally different when you switch from traditional to modern approaches. There’s much more emphasis on the design stage as building components have to be right before they leave the factory.
But without adapting to new methods, UK construction will be stuck with low productivity gains – and the low margins and quality issues that come with it.