According to the government, boosting innovation, competition and entrepreneurship within the Australian construction industry are key to upholding the country’s living standards into the future and maintaining our 23 years of uninterrupted economic growth.

Increasing innovation and productivity within the construction sector was the hot-topic of interest during the latest Construction Leaders Forum held at the University of New South Wales and hosted by the Faculty of the Built Environment.

The event was backed by the Australian Institute of Building and the Australian Contractors Association. It brought together 25 industry leaders from the country’s biggest construction contractors to debate the aforementioned topic.

3 propositions were discussed:

1. Productivity within construction can be boosted.

Productivity within Australia’s construction sector has been worn away by cost escalations and over the past decade our competitive advantage has weakened. To counter this backslide we must increase productivity and innovation, not seek to establish a low-wage industry. Leadership, strategy and a shared vision will be integral to making headway.

2. Australia’s construction industry needs to change its thinking to prosper into the future.

In our quickly changing times, it is vital we keep up with the rest of the world. In order to do this we must look to identify innovative ways to increase productivity and efficiency into the future. Some progressive countries have identified performance and efficiency relies upon a wide variety of innovations to do with supply chain integration, technology, skills development, procurement, design, and collaboration.

3. Industrial relations is important when it comes to productivity, but other areas shouldn’t be neglected.

A good productivity mix comes down to:

• A skilled, knowledgeable and engaged work-force

• Efficient procurement models

• Innovation

• Trust between stakeholders

Debate Recommendations

7 Ways The Construction Sector Can Help Boost Productivity

1. Increase delivery predictability.

2. Better manage risk and responsiveness to the client’s needs by encouraging increased collaboration and integration.

This can be accomplished by integrating the whole supply-chain from design, to construction, manufacturing and facilities management.

3. Transition to service-based delivery model from product-based.

A fully-integrated, service-based, delivery model is replacing lump-sum contracts as clients are increasingly satisfied with the industry moving to service-based solutions to meet their needs.

4. Technology

Industry engagement with proven technological innovations which have resulted in driving productivity increases in other business sectors must be heightened.

5. Enhance supervisory and project management skills.

Project management skills are being lost due to under-investment in an aging workforce and blue collar worker skills training and development. This must be addressed and improved.

6. Develop greater supply chain collaboration.

Sub-contractors are often inadequately integrated into construction projects. Productivity increases can be achieved by treating sub-contractors as partners and giving them a title which reflects this such as ‘specialist contractors’, or ‘co-contractors’.

7. Business culture is key.

Excellent communication, strong employee relationships and reward systems, powerful diagnostic usage of performance data, enhanced external connectedness to clients, supply chains & communities, high-level internal connectedness between levels and functions and more are integral to creating a high performing workplace.

10 Ways The Government, Regulators & Clients Can Help Improve Construction Productivity

1. Minimise uncertainty regarding project pipelines and increase transparency.

2. Allow for enough time to strategize and innovate.

3. Lower bidding costs.

4. Ensure construction project planning is kept realistic and feasible.

5. Evaluate procurement and contract models.

6. Innovation should be incentivised and value maximised by selecting project teams based-off their ‘value proposition’ rather than lowest price.

7. Involve contractors early to drive efficiencies and innovation.

8. Improve regulation efficiency and minimise bureaucracy.

9. Place more importance upon good design.

10. Improve the usage of data & analytics. 

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