The 15th Edge Debate: 11th December 2002

Action Points

1. Starts with understanding of customer needs. What vision? Is each construction project unique? Can we standardise/manufactured buildings?
2. Possible to deliver unique in same time frame and to same standard (if you start early enough/collaboration) - uniqueness is close to repetitiveness. Perception of uniqueness is major problem. Product might be unique but processes are not.
3. Is it design or construction? Perhaps not 90% of construction is a repetitive process? Client does not care about innovation in the building - only the cost?
4. What do customers want - on time and at lowest cost? But decision about what 'it' is in these cases has already been decided. Customers should want value in terms of the business's own strategy not about maximising short-term share position. Cost levels we are used to are bad in terms of Europe, largely in services engineering. We do have to get cost out but should be aiming at Dutch levels.
5. Problem in breaking the tasks up. Car industry does bespoke cars on basis of standardised components - different configurations. We in construction could do the same. Can produce levels of uniqueness with standard modules. Competitive tendering process does not put a value on innovation.
6. Whole process needs to be revisited - delivering a building early gives value. No one goes back to look at what the lowest cost bid was.
7. Double bind- Egan. Not expected to innovative on live projects? Innovating on live projects is risky.
8. Zero carbon economy is the excuse for more innovation
9. How interdependent are we as organisation to begin to improve this process of innovation. In manufacturing there is a club to share innovation. In construction we have to recreate the club on every project. Or can some really innovative organisations break through - do they need to go through the club process?
10. Inevitable that you are going to get vertical chains. It is called partnering.
11. Can the industry transform itself to that it can carry around the innovation? What happens with small and occasional? How many BAA partner firms have taken their innovation techniques to other clients?
12. Parallel design process that happens in other industries. Can work because they are involved at the beginning. In the construction industry it happens sequentially.
13. Trust. Some projects that succeed are ethical. Is there a relationship? Without ethics you cannot build a business.
14. Threat: EU directive on procurement: there is no such thing as a trusting relationship. It is corrupting. You must have a sealed envelope world. Airbus. How can it be procured on this basis? Boeing think the Airbus is corrupt, paid through the European system and undercuts the competition. It is not a coincidence that every construction industry in the world starts off with a tendering process. When trust gets abused it is bad news and it does get abused.
15. Trust and interdependency -long-term collaboration. Means you do not abuse
16. Nature of leadership. Is leadership of innovation parallel or sequential? Is effective leadership linked to control of resources? Leadership can be seen as only effective if there is enough backing. Without it, it can be futile.
17. Leadership of innovation - freedom to design/responsible innovation. It has to be parallel. No main contractor has a director responsible for research?
18. Effective leadership might only be possible if we have an effective business case for innovation. Trox have a business case for innovation. Have we even begun to understand how to construct a business case for innovation?
19. PFI is focusing attention on innovation. Created pressure to have a business case for it.
20. You have to move the word effective to 'effective' management of resources. How can you have a business otherwise? There is a basis of a business model that is going to drive positive leadership/championship of value that, in turn, drives diffusion.
21. Fairclough frustrated with this aspect.
22. Pharmaceutical clients do not understand how design of building can influence the outcome of research being undertaken in them.
23. How does the built environment add value? Has to be one of the main drivers for innovation. But little knowledge in terms of understanding increased performance. Buildings are platforms for productivity for client/for adding value. Up market model enhances range of activities. Problem has been with us for 40 years and we have not cracked it. It scares us. Difficult to separate the building performance from the management of the building. Disaggregating is possible but difficult but we can do it. It is part of the business case. But we are lacking the basic data to make this case.
24. Be: model for how 7% GDP (50% new, 50% repair) we spend on the built environment leverages the other 93%?
25. Credibility problem. Emblems do not always work. What does the money we spend achieve?
26. What do we have to put in place to make a proper statement about value added that makes a business case?
27. Big issues are not touched
28. Partnership at beginning of contract, partnership after the tender process and partnership...
29. Stop comparing car industry with construction. Construction doing well if it makes 2% profits. This is where the problems start. You have to make the business case to the repeat client.
30. Only making 2% because not investing in innovation
31. We focus on the product. Sony innovative in the product AND the way they produce the product. We do not make enough profit because we link innovation to profit should be part of the planned overhead.
32. If innovative allows failure? Parallel processes are going to cost more. Share the risk with the client and get the benefits from the innovation. Cheaper product/quicker time to market.
33. We do not deliver good buildings when we do not innovate.
34. What are we going to do to get a better business process and drives better value?
35. Change the contractual nature and share the added value.
36. Persuade Stef that innovation should not be linked to profit.
37. Added value. More than half work negotiated. Seen to bring value. By innovation can increase value. Have got to change the process for more repeat clients.
38. Partnering before and partnering after. Don't do tendering blind.
39. Better understand what value is to have the right dialogue. Benefits of the output over the sacrifice of the input.
40. How to get this message across to clients. Why are we waiting for clients to lead?
41. Need to enjoy innovation. It is a way of getting good people and having a better quality of life.
42. Whole life value.
43. Stop calling it a business process - why? Too much jargon. Inspire them in other ways. Is this a UK cultural problem? Innovation is the effective management of resources. Don't confuse innovation with invention - successful exploitation of ideas.