Supply-led procurement

I am interested in how new developments to procurement and business practice will impact roles in construction projects. For example, I can see a strong and compelling case for distancing architects from the construction process even further than they are now, so that their focus would be more on the art and less on the technicalities of building. I am developing my research along the lines of Supply-led procurement (a more robust development of the industrialized building agenda). This basically means handing over responsibility for innovation (and the rewards for innovation) to the supply chain. Either architects become more technical and get involved commercially with innovative producers of technical solutions, or they step aside from the commercial process completely, and develop a more advisory role. The idea of an architect co-ordinating and certifying work in progress may become a thing of the past. Indeed, I would like to go further and suggest that construction work should not be based around labour and materials paid for on a work-in-progress basis. The supply chain has an opportunity to get its act together and become truly innovative and integrated. It may be that architects and the professions are the main obstacles to developing new models of finance, new contracting methods and new business models. What would a fit-for-purpose construction sector look like in the Third Millennium? What kind of obligations are suppliers willing to take on, in return for a closer relationship with construction clients and users, and the opportunities to introduce technological innovations without having to route their work through layers of intermediaries?

Complex, commercial, contractual relations

It is interesting how much research in our field is predicated on the assumption that good process leads to good buildings. If this were so, surely there would be few poor quality buildings by now? After all, we are surrounded on all sides by advice and guidance on processes of all kinds. There are British Standards, International Standards, Codes of Practice, Guidance Documents of all kinds. Yet still we produce poor quality buildings. Clearly, we are dealing with a level of complexity in construction that is difficult and uncertain. Perhaps the idea that good process leads to good buildings would form a useful basis on which to critique a lot of the research that has been published in construction management? After all, it has long been accepted in organizational theory circles that there is more to an effective organization than its structure. So much so, that organizational structure is a rare breed of research paper. Or perhaps they have just changed their vocabulary so that I don't notice what passes these days for organizational structure!

The complexity in construction is not necessarily technical, but organizational. Because of the way that the processes are organized, there is a need for diverse skills, and it is important for the purposes of continuity of work and the development of specialized skills that these diverse disciplines are typically found in different firms. To bring a team together means that contracts are important, because each different group of skills comes from a different business. And we are talking about business, therefore commercial interests play an important role in colouring the behaviour of the parties, even if they are exercising professionalized roles. Finally, because the planning, design, construction and occupation of a building occupy many years, the continuity of relationships can be very important. Thus, the kind of organisational problems we face are characterized as complex, commercial, contractual relations.

Anyhow, today's realization was that buildings are just buildings and not, in themselves, good or bad. Good and bad are judgements that reside in people, not characteristics that reside in buildings. More important, in my view, is that when we judge something to be good or bad, successful or unsuccessful, we are typically comparing what we can observe to our expectation. If our expectations are met, then we are more likely to be satisfied. I have long been aware that this is why marketing is so important for business; good marketing is designed to adjust and deal with our expectations, so that we are more likely to be satisfied with certain products, despite their qualities and characteristics, rather than because of them. So if expectations are the important thing, then clear communication is essential. Within the construction sector, we are used to problems of conflict and dispute. Perhaps these, too, can be laid at the door of inadequate communication leading to unmet expectations? Information asymmetry is an important idea that underpins this. It is inevitable in a complex commercial environment that one party will have more information and knowledge about the transaction than the other. Often, the supply side has the upper hand when it comes to information asymmetry, but if the demand side employ professional consultants and design what is to be fabricated, then perhaps the result would be that the demand side has more information than the supply side about important aspects of the job.

Perhaps the purpose of communication in complex, commercial, contractual relations is to reduce information asymmetry and ensure that expectations on both sides are reasonable. This would lead to a hypothesis that information symmetry should lead to greater satisfaction. Businesses expend lots of effort in precisely this area. Conflict flows from dissatisfaction and it is expensive and destructive.

Above all, in construction the transaction is very difficult because the demand side basically requires space, whereas the supply side can only provide boundaries to space. I think this is the interface between architecture and building. We buy buildings because we want space, not because we want walls. No wonder there is information asymmetry, when we have to buy something other than what we want in order to get what we want!

New British Standard - BS 8534 Construction Procurement

After more than a year of work, coordinated by Constructing Excellence, the
draft for public comment is finally available for the new British Standard on Construction Procurement. The full title is "BS 8534 Construction procurement policies, strategies and procedures – Code of practice". This is designed to complement the recently published ISO 10845 on construction procurement, which focuses more on the procedures of tendering and selection. The British Standard is intended to provide an approach for developing a strategic procurement framework, taking advantage of the opportunity to codify and develop the many recipes for good construction practice that have emerged in recent years.

Here is an extract from the foreword: "In May 2006 a strategic workshop was held to establish what drives value in the construction industry. It and a subsequent series of specialist workshops were sponsored by the then Department of Trade and Industry and its successor, the Department for Innovation, Universities and Skills, under the heading “Rethinking Standards in Construction” and organized by BSI and Constructing Excellence in the Built Environment. The main conclusion from the “Infrastructure” workshop was that there was definite potential for a new standard on procurement, provided it used the Office of Government Commerce process as a baseline."

Now is your chance to get involved! The Draft for Public Comment is available for you to download from the BSI website, at http://drafts.bsigroup.com/Home/Details/679. You will need to register on this site and choose a username and password, because the BS secretariat would like to know who is commenting, and they may want to get back to people for clarification.

Please, take the time to engage in this public consultation, because this new standard may soon be shaping the way that construction projects are organized!

Comparing the values of research outputs

Recently, the CNBR network carried a message announcing a conference in Australia, and one of the recipients sent a rejoinder about how this particular conference was one that was selected as an "A" rated conference for the Australian Excellence in Research for Australia (ERA) scheme. This scheme involved ranking all journals and conferences and giving them a rating. It provides an administrative route for Australians to decide whether to appoint/promote academics, based on how many research outputs they have got in the top-rated outlets on the list. It also means that Australian universities would probably not fund their staff to go to conferences that are not A-rated. This is symptomatic of a much wider movement in society, generally, to avoid the need for professional judgement at all levels. Some commentators (e.g. O’Neill, O. A Question of Trust: The BBC Reith Lectures 2002. Cambridge: Cambridge University Press.) have connected this to the decline of trust in society. Of course, although there is a general feeling that trust is in decline, and that we need more of it, it does not necessarily follow that we do indeed need more trust. It is interesting to read Cook, Hardin and Levi (2007) (Cooperation Without Trust?) who argue that there are better things than trust to account for social order.

When I was working on the Professional Futures study, it was clear that there was a growing difficulty in society in terms of making judgements. I think this is getting worse. People are so frightened of making judgements of any kind that they would prefer to have objective lists of publications, rather than actually look at things and figure out whether they are any good. This prompted me to respond to the list as follows:

I think it flags up the lunacy of the whole process of ranking conferences and journals in this way. Are we to suppose that just because a paper has been published in an A*-rated journal or A-rated conference that it is definitely better than a paper in a B-rated forum? And are we to suppose that anything that was published outside of these A-list things is somehow sub-standard?

I sincerely hope that most of us are clever enough not to accept administrative views of what constitutes quality when it comes to research outputs! I would hope that academics have an eye on their peer groups, and on their own careers beyond their current employer, even if we are told where to publish. What senses do we lack that we cannot detect good conferences, journals and papers for ourselves?

Various colleagues responded privately to me, agreeing and offering observations about how the list was compiled in a very narrow and parochial way. One colleague from the Netherlands observed that although she agreed wholeheartedly with my views, if you find yourself in this situation, there is no much that you can do. And my rejoinder was:

It places you in a difficult position, for sure. If it is not your peers who are deciding which are your most important outputs, what chance have you got?

I think that in such a situation, it may be helpful to acknowledge that there are two different games to be played, and they are somewhat incompatible, but not wholly. First, our bosses want us to perform in a strictly quantifiable way that requires numbers of papers in certain places. Second, we need for our own careers to figure out a publication strategy that places our work where it reaches the peer group we seek to access. Admittedly, these two activities overlap, hopefully by a lot. But we have to acknowledge that sometimes it is necessary to publish outside the manufactured lists. In the long run, it is important that academics keep an independent sense of what their field looks like. Also, I would expect that this whole discussion may look different in other fields.

So, I agree that it is not possible to ignore the lists when you are subjected to that kind of regime. But I also think that we have to keep a sense of perspective, and ensure that our publications help each of us to develop an appropriate publication profile that can be appreciated by our peers not just for quantity, but for quality of the research. And that requires subjective, professional judgement.

It is worrying when intelligent people like academics collude in the erosion of their own judgement.

Standards and regulations

Rosabeth Moss Kanter (1983: 22) wrote,

... the aspect of productivity that needs serious attention is not the mechanical output of a production facility; it is, rather, the capacity of the organization to satisfy customer needs most fully with whatever resources it has at its disposal ... But mechanical notions of productivity lead often to products that meet ever more refined minimum standards, frequently resulting in a decline in customer satisfaction with them. The former thrust calls out for innovation - indeed, for innovative thinking on every level of the organization’s affairs - while the latter confines innovation to a marginal and unexciting role

Is there a danger that the existence of minimum standards in professional work is problematic? To what extent do we need mechanical notions of productivity when undertaking professional work? The widespread use of key performance indicators, standards and regulations is clearly a reaction to increasing dissastisfaction with service from all sorts of professionals. But are we in danger of creating a situation that almost guarantees decreasing standards, because we make people accountable for measurable outputs, rather than for the quality of their decision-making?

Kanter, R.M. (1983) The change masters. New York: Simon & Schuster.