Overview of the UK Construction Industry

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1.1Overview of the UK Construction Industry
It has been 10 years since Sir John Egan delivered ‘Rethinking Construction’. Having rocked the construction industry with its publication in 1998, none of the seven targets have been met (Building Magazine, 2008).

The UK construction industry was ranked behind the US and Japan but ahead of Spain and Italy against Egan’s benchmark areas. Government bodies were criticised for “talking too much about issues” rather than taking decisive action (New Civil Engineer, 2008). Prior to Egan 1998, many of his predecessors in the UK such as Simon 1944, Emerson 1962, Banwell 1964 and Latham, 1994 have all reported on the widespread dissatisfaction within the construction industry. Most notably, the influential Latham Report reviewed procurement and contractual arrangements in the construction industry. It tackled the most controversial issues facing the industry during a period of lapse in growth as a whole. Focusing on selection, tendering, and construction procedures it sought to aid the industry as a whole by encouraging a team approach to all aspects. The main inefficiencies identified pointed to the need for greater partnering and collaboration in the construction sector. This report acted as a ‘wake up’ call to the industry and led to a reform as the industry was described as ‘adversarial’, ‘fragmented’, ‘incapable of delivering for its customers’ and ‘lacking respect for its employees’. The report led to the establishment of the Construction Industry Board to oversee reform and subsequent initiatives such as the Egan Report 1998 ‘Re-thinking Construction’; the ‘Construction Best Practice Programme’, ‘Movement for Innovation’ and ‘Constructing Excellence’ were all designed to drive the industry forward. These initiatives led to many key practices such as partnering, lean construction, supply chain management and total quality management; some of which aren’t entirely new practices, for example, partnering has been widely practised for many years but perhaps not as well documented or researched upon. 1.2International Overview

Different countries have different approaches to improving performance in their construction industry. For example, Hong Kong was stimulated by the publication of “Rethinking Construction” in the UK. In 2000, Hong Kong established a Construction Industry Review Committee, drawing membership from a wide range of government, client and construction interests to investigate issues in construction and to make recommendations for improvement. The report of the Review Committee “Construct for Excellence” was published in January 2001. The Committee's analysis of issues in Hong Kong was very similar to that in the UK: •concerns over the quality of the final product

a view that construction was expensive, with fragmented responsibilities and adversarial relationships inhibiting improvements in efficiency and causing disputes •inadequate attention to training and a poor safety record •a need for greater investment in IT and in new technologies, supported by research •a need to create a more sustainable industry

In comparison with “Rethinking Construction” the report paid more attention to improving the final product (e.g. in terms of sustainability). It also diagnosed some problems as stemming from specific local causes - for example multi-layer sub-contracting. But its views on the ways in which the construction industry and construction clients included: •more integrated supply chains, with longer term relationships that would encourage learning and continuous improvement •partnering between clients and the industry

adoption of 'best value principles, that balanced quality and cost, in procurement - with the public sector taking a lead •use of 'Alternative Dispute Resolution' to minimise legal disputes •registration of sub-contractors and better site supervision •adoption of new safety regulations

use of Life Cycle...
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