From contingency to continuity
Setting up for success, from long-term to lifetime
After a challenging 2023, UK construction began 2024 with a mixed picture. While output continued to contract, the value of new orders placed in Q1 jumped compared to the final quarter of 2023.
Following the Brexit referendum, global pandemic and continued geopolitical tensions, the 2024 general election is another layer of uncertainty for new UK real estate and infrastructure programmes to manage.
Many programmes getting underway this year will have construction horizons of 10 years or more – not to mention an operational lifetime many decades longer, as well as increased complexity and a broader set of target outcomes.
The prospect of major change during an asset life cycle, especially of 50 years or more, that straddles multiple political and economic cycles is an inevitability, not an incidental risk. Programmes therefore need to be set up with adaptability to succeed.
To do so, businesses and asset owners must:
1.
Choose the right delivery model and expertise
The set-up process should take a 360-degree view, identifying not just the ownership of each element of the programme but also what the organisation’s overarching priorities are and who has the technical expertise and experience needed to successfully oversee the delivery of the programme.
Before choosing the right delivery model, businesses should take the time to identify such points before the design phase begins, appointing the right team to support them, better equipped to define what project success looks like, and how to achieve it even as their priorities and needs evolve.
While the choice of delivery model will inevitably turn on key metrics such as time and cost, the focus should be on value – and how both client and supply chain will achieve agreed strategic, environmental, commercial and social value outcomes.
Intelligent delivery models should be more than a list of instructions or targets. They must articulate and embed the behaviours needed to maximise digitally-enabled collaboration and agility through every stage of the project.
2.
Integrate delivery and commercial models
The commercial model should also be more than just the web of individual contracts which underpin the project. It should provide a mechanism to drive intended behaviours and reward value - working towards achieving the agreed strategic outcomes.
Central to this is the appropriate apportioning of risk and reward between the organisation, their partners and the wider supply chain to maximise value and support sustainable, longer-term relationships.
Rather than loading all the input cost risk onto suppliers, the best commercial models will be carefully calibrated to manage risk and reward outcome outperformance, rather than inputs, and balance market maturity with economics.
That way both suppliers and client will have ‘skin in the game’ and will mutually benefit from improved performance and programme outcomes.
Programmes procured this way tend to attract more, and better quality, bidders at the tender stage. Once delivery begins, the shared sense of purpose and clarity on roles and responsibilities makes the programme team more agile and incentivises collective, rather than individual, performance.
3.
Dive into digital
Digital tools don’t just make people and processes more productive – they are also creating new, more efficient ways of working.
While its ultimate goal may be to deliver optimum outcomes for cost and schedule, digital’s role should be central right from programme inception. From design to cost planning, to mapping a project’s carbon footprint throughout its construction lifecycle using tools such as our Embodied Carbon Calculator, digital is critical to successful set-up.
The goal should be to establish a multi-dimensional digital environment. Designers, engineers and suppliers need to collaborate in real-time and must have access to ultra-detailed, live and interrogable data.
To deliver its full potential, a digital strategy needs to be embedded in project delivery and backed by a clear understanding not just of what, where and when data is collected – but also how its use will unlock new construction techniques, attract and engage suppliers and deliver greater certainty for the client.
Sophisticated digital technology also provides an indirect, but no less important, benefit by helping to attract talent to the programme and to the wider construction industry.
For a sector with a chronic skills shortage, which has struggled to attract graduates favouring other industries, the best digital tools can showcase construction’s dynamism and its ability to deliver lasting improvements to the way people live, work and travel.
4.
Get future-ready to manage disruption
Predictive modelling is the next frontier in digital. Used correctly, it enables the client to understand where the project is now, where it is heading and how their asset might be affected by change throughout its lifecycle.
From GPS tracking of materials as they progress through the critical path, to understanding the impact of long-term trends like climate change or unexpected events, leaps in data processing power allow digital teams to anticipate and manage disruption during both the construction and operational phases.
Future planning needs to be underpinned by a well-structured understanding of the past, and this is where access to precisely benchmarked data, whether from earlier stages of the same programme or similar projects in the sector, is invaluable.
We have gathered real-world performance data from our teams around the globe through the use of our proprietary digital platform known as ‘the Hive’; which contains the apps we use to deliver agility, accuracy and ongoing validation on behalf of our clients.
Sustainable outcomes, from long-term to lifetime
With an asset that might take 10 years to build, and then remain in operation for decades, fundamental and repeated change is inevitable.
Those responsible for commissioning, construction and operation, therefore need to incorporate the right expertise and technology into the delivery model, right from the start.
The best managed programmes will be robust and responsive in the face of change - enabling leaders to shift the focus from dealing with individual contingencies to ensuring continuity.
© 2024 Turner & Townsend