It’s now 5 months since Mark Farmer published his comprehensive review of the Construction sector model “ Modernise or Die” and it appears his recommendations are already having an impact on Government policy and sector plans but is it clear in what ways?

Here CP Ltd provide a quick perspective to help de- mystify some of the issues from what we consider to be one of the most profound, independent reports into the current state and potential future of construction in recent times.

1.Fixing the Broken Housing Market: the Housing White Paper( February 2017) – UK Government seriously considered some of the key recommendations including :

The Farmer Review sets out several challenges for industry. The White paper states this is “an important moment and we should make the most of the opportunity for industry to invest in its workforce, alongside tackling the issues raised by the Farmer Review”. The larger companies need to take responsibility for ensuring that they have a sustainable supply chain, working with contractors to address skills requirements.

Government recognises that the housebuilding industry is less productive than the wider economy, partly because it has been slow to modernise and make use of more efficient and faster ways of building. By increasing innovation and making greater use of modern methods of construction. The Review backed a revolution in making new homes in factories and then assembling them on site, as a way of speeding up construction and also to ease a skills crisis by offering more attractive, warmer jobs more to do with precision engineering than traditional building roles.

2.Impact on providers and the market –  large scale providers are now actively seeking different delivery models that the Farmer report suggested were the industry’s real untapped opportunity. From late 2016 there were various announcements regarding new players entering the market using innovative delivery models at a scale not seen before – and that trend is continuing into 2017 supported by government housing and industry strategy policies and increasing international interest in the UK pre-manufactured construction opportunities.

3.Training and skills development – a trend of decline in skilled labour, exacerbated in every downturn by an acceleration of industry labour leakage which has not been replaced . Training in construction is difficult concept as the self-employed nature of much of it and the reliance on a fragmented supply chain mean there’s little incentive for subcontractors to invest in long term employee development. The government has recognised the scale of the problem and is now actively looking for solutions. Farmer is working with the Construction Leadership Council, at the request of ministers Brandon Lewis and Nick Boles, to draw up an action plan to explore potential new business models which address both skills shortages and methods of working that hopefully will lead to more workers entering to the industry whilst also making it more productive.

4.Collaboration & Building Information Modelling(BIM) – Farmer argued that to enable change at scale, the private sector needs to start using BIM as a matter of course, not as an experiment or a “nice to have”, but driven by a quantifiable benefits case that hard-nosed and commercially driven commissioning clients can get comfortable with and who will then will insist on this approach on their projects which others will then take notice of.  The impact of BIM is still fragmented with many still pointing to the technical benefits of BIM as a collaborative tool almost as a panacea. In many instances ‘BIM’ is in reality various partial “Revit” or other software models being developed around a project and then being badged as ‘BIM’ despite no discernible impact on procurement, cost management, risk management, or contract payment practices. The truly collaborative inter-disciplinary, inter-company working with a fragmented Design/Main Contractor/Sub-Contractor model is just too unattractive to clients who want to achieve value for money – the fundamental contractual structures and behavioural inertia in many organisations still needs to be tackled.

5.Developing a Modern Industrial Strategy Green Paper (January 2017) – the UK Government published this discussion paper after the Brexit vote in an aim to build an industrial strategy that delivers a high-skilled, competitive economy that benefits people throughout the UK as whilst many people, places and businesses are thriving, opportunities and growth are still spread unevenly across the country. This modern industrial strategy is proposed to be founded on 10 pillars of Industry many of which chime with the Farmer Review recommendations including:

  • Developing skills – we must help people and businesses to thrive by: ensuring everyone has the basic skills needed in a modern economy; building a new system of technical education to benefit the half of young people who do not go to university; boosting STEM (science, technology, engineering and maths) skills, digital skills and numeracy; and by raising skill levels in lagging areas.
  • Improving procurement – we must use strategic government procurement to drive innovation and enable the development of UK supply chains

The full impact of these and other aspects of Farmer’s recommendations will take more time to become clear. CP Ltd will provide updated perspectives on these key issues as they develop.

We hope you found this post useful and in addition we at CP Ltd can help you build your skill base and provide coaching and guidance on collaboration, leadership and partnership working in line with the Farmer recommendations. Please get in touch to discuss how we can help you and your organisation.