Development of the Construction Industry

Development of the Construction Industry

Introduction

The construction industry affects the economy, the environment, and the society in that it touches on the lives of people and serves most industries directly and indirectly. According to Griffith & Watson (2003), the construction industry is a key facilitator of the UK economy and contributes approximately £90 billion to the economy. This is due to the fact that the construction industry comprises approximately 280,000 business that covers atleast 2.93 million jobs. Before the recession in 2007, the UK industry accounted for 8.9% of the total GVA which decreased to 6.7% in 2011 following the recession. Despite this form of financial and economic crisis, the construction industry is considered one of the largest industries in the UK economy owing to its gross value, employment, and a total number of enterprises.

Historical Development of the Construction Industry

The status of the construction industry evidenced today is a result of interventions from multiple professionals including architects, entrepreneurs, contractors, clients, and engineers, among others. A localized industry of art became transformed in the last 150 years to a global industry that is now characterized by modern infrastructure, manufacturing industries and, coefficients of efficiency (Griffith & Watson, 2003). This interest in construction was facilitated by increasing demand for housing, industrial and commercial buildings owing to increment in population from 10,164,000 in 1811 to approximately 20,066,000 in 1861 (Rabeneck, 2011). This caused the construction industry to grow in prominence and other connected industrializing economies that facilitated sustainable economic growth to offer comfort to the growing population. According to the 1851 census, approximately 496,000 men were involved in the construction and building industry out of a total population of 6.5m workforce of males (Rabeneck, 2011).

This exponential growth in development activities facilitated the creation of new labor processes and new forms of organizations to support the field. Starting from the 1820s, architects created their body of professionals that was intended to protect their interests and facilitate the maintenance of design responsibility (Kymmell, 2008). The desire to enhance professional stability and to vilify old styles and practices of buildings facilitated the development of the Institute of British Architects in 1834, among other professional bodies (Rhodes, 2019). This was followed by the development of the contractual transaction model that led to the maturity of construction practices into the First World War which was coupled with the creation of other craft and professional associations. The construction sector developed an array of professional bodies that host different types of professionals in a bid to increase the stability of the significance of the field in the industry. They include:

Laws and regulations were later crafted to protect the interests of the public which was followed by various training and school programmes that supported industrialization in a bid to meet the growing demand for social, commercial, and institutional development (Rabeneck, 2011).  As such, traditional experiences were crystallized into distinct rules of practice that were taught and passed to younger professionals who created scientific understanding in construction with regard to compatibility, performance, and durability of different materials (Griffith & Watson, 2003). Higher demand in the 20^th century increased the use of artificial construction materials that was coupled with new techniques to increase productivity, reduce costs, provide remedy to old construction issues.

As such, the ability of the construction industry in the UK to contribute to the economy can be attributed to the initiation of science and technology to the industry in 1918 that influenced housing policies and building bylaws. Further anticipations of war also facilitated the need for systematic research in a bid to handle the challenges of reconstructions in the event of another world war. Currently, the industry has integrated innovative processes and technology in a bid to undertake procurement, education, and construction practices such to promote efficiency, sustainability, and productivity. Over time, the industry has become a leader in the UK economy with buildings such as the Shard in London providing affordable housing choices for the citizens. The introduction of technologies including the crusher rock machinery in a bid to promote sustainability through green construction practices has caused the industry to become a recognized sector in the country.

Scope and Linkage Between Various Skills, Bodies within the Organization

The construction industry is a complex industry whose success involves the integration of different contractors, professions, operatives, and subcontractors.  The success of activities in companies such as Skeptcom Contractors depends on the linkage and integration of different professionals, bodies, and skills. The activities involved in the industry often vary from commercial buildings to the construction of motorways and power stations all of which involve the contribution of different personnel who work together to ensure successful completion of the project within the stipulated scope. It is comprised of different activities including surveying, architecture, planning, building, structural and civil engineering. It also including engineering of building services including lighting, waste disposal, heating, escalators, and alarms among others (Rhodes, 2019). Additionally, construction activities cannot be complete without the contribution of facilities and estate managers who oversee the cleanliness and maintenance of the buildings before and upon completion, among other activities that are required to operate and run the building. The skills of highway engineers are also required to smoothen the construction processes by constructing infrastructure in relation to safety legislations, as well as the monitoring and constriction of roadways and bridges, among others. Apart from professionals, the construction industry involves various client types including commercial, private, government and public limited companies (Griffith & Watson, 2003). For instance, the government can issue an array of tasks including the construction of school and maintenance of highways through local councils and devolved administrations such as the Welsh Assembly and the Scottish parliament. Other activities undertaken may include agricultural, educational, industrial, residential, health, and public buildings, among others.

For instance, the success of a project undertaken by the Skeptcom Construction company depends on the ability of different professionals and participants to work together. In such a scenario, each professional must execute their responsibilities as shown in the figure below.

Source: Pearson Schools and College (n.d.).

Type of Contractual Work Tendered by Contractors.

Contractors in the UK often tender for different types of contractual work including commercial contracts, lump-sum contracts, domestic building, and percentage rate contracts. Others include cost-plus contracts, time and materials contracts, and unit pricing contracts. In their acquisition of these contracts, the contracting company must adhere to the stipulated tendering process that may vary from open tendering, serial tendering, framework tendering, selective tendering, and public procurement, among others.

Analysis of the Development of the Construction Industry

Since time immemorial, the construction industry has always been considered an essential aspect of the economy. This growth can be attributed to the ability of different organizations to work together to create a successful construction project. Different teams often interact through different structures that may vary from functional structures, flat, matrix, divisional, network structure, and line-organizational structures. However, some organizations such as the Skeptcom Company prefer to use a simple organizational framework that has diverse layers with the manager taking the senior position. This structure helps to ensure the fluent flow of information, instructions, and resources from the top management to the individuals in charge.

Source: Pearson Schools and College (n.d.).

In addition to changing the organization structure from a bureaucratic structure to one where there is easy coordination of activities, the industry has also changed from the traditional model of construction to one that is driven by offsite manufacturing, digital engineering, and component assembly. Technology has reduced construction risks and made it possible to undertake virtual development while testing scenarios that may affect the operation and construction to ensure quality work while minimizing disruptions (Griffith & Watson, 2003). The implementation of technology has made it possible to promote various elements of architectural, engineering, and structural aspects by integrating them into a virtual prototype that allows seamless transfer of information and coordination of activities between different participants.

The execution of contracted work has also improved with the appreciation of technology whereby the procurement routes have reduced the inherent complexity. In the past, the system entailed complexities such that tenders were often sought for a wide array of goods and services through diverse procurement routes (Harris & McCaffer, 2013). This traditional tendering process was cumbersome and often facilitated the growth of conflicts and adversarial attitudes. In the current system, this complexity has reduced with most suppliers aggregating into single contracts such that public projects include integrated supply teams that involve distinct teams such as designers, suppliers, contractors, and facility managers, among others.

Development of Business Ethos and Structure of Construction Companies

The organizational structure of construction industries has advanced whereby the supply chain is highly fragmented with most of them being regional, national, or local in some instances.

This figure shows a simplified representation of a supply chain whereby most of the activities in the sector are organized around distinct projects such that contractors work with product suppliers and specialist subcontractors to deliver the built asset to specific clients.

In a bid to promote business ethos, the industry has implemented modular construction in order to limit environmental disruptions and deliver the components when needed. This strategy has reduced costs by eliminating the need for additional space for materials and has created sustainability benefits associated with reduced movement of vehicles and reduced waste (Griffith & Watson, 2003). Just-in-time manufacturing has also contributed to adherence to construction ethics by reducing the utilization of resources and onsite storage by streamlining the construction process. For instance, disruption and wastage of natural resources were reduced by 85% during the development of Leadenhall that utilized modular construction strategy. Other strategies in the UK industry include the use of carbon-efficient procedures, lean production processes, reduction of greenhouse gas emissions, and the implementation of BIM in construction.

Construction Companies and the Relationship with Tendering

Different Types of Construction Companies

A construction company entails a large multi-tasking agency that is often made up of distinct entities. In the UK market, the construction industry is made up of different types of companies including renovation contractors, general contractors, owner-builder, program managers, real estate developers, and package builders.

• Renovation contractors often provide construction activities that do not require huge estimations and construction activities (Dulaimi, Akintoye, & Main, 2007).
• General contractors are responsible for alteration work or the construction of new buildings.
• Owner-building construction companies often develop a property for renting or selling for their own account.
• Real estate developers are a form of owner-builder who builds with the aim of selling before or after the completion of the project.
• Professional construction companies often provide the necessary personnel including accounting personnel, project managers, superintendents, and expediters that is required to complete the construction process.
• Program manager company is involved in the demolition, financial analysis, supervision of services, advertising, and performance of pre-construction services.
• Package builder companies have an array of employees such as engineers and architects who subcontract their services to clients.

Some of the companies found in these categories include Kier Group Plc, Balfour Beatty Plc, Interserve Plc, Morgan Sindall, Amey UK Plc, Mace Ltd, and Galliford Try Plc, among others.

Relationship between different Construction Organizations

Construction companies in the UK often collaborate closely in a bid to meet customer demands and attend to market opportunities. Cooperation between different companies also helps to reduce risks and costs of construction development as well as the need to achieve collaborative corporate culture (Harris & McCaffer, 2013). An increase in supplier needs, technological changes, and the need to respond to competitors can also necessitate the need for organizations to collaborate and relate positively with each other. The success of construction companies is dependent on their ability to develop partnerships, network, and work as an integrated system in order to minimize risks.

One of the most evident representations of the relationship between different construction organizations is that between Carillion Plc and Balfour Beatty Plc. After encountering an array of financial and management issues, Carillion Plc got into a joint venture with Balfour Beatty in a bid to complete the projects that Carillion Plc was working on such as the Aberdeen Western Peripheral Route. After the compulsory liquidation of Carillion Plc, Beatty continued to meet the contractual commitments of its customers and the public. In a bid to expedite the process, Galliford Try Plc also entered into a joint venture with Carillion Plc in order to complete the government and private projects. This shows that the success of construction organizations depends on their ability to undertake partnerships and relate positively with each other.

Relationship Through Tendering and Contracts

After the industrial revolution, procurement was considered the main route of securing constructed facilities in the UK which is still preferred by clients in construction. However, traditional procurement strategies have changed in the UK due to the fact that this approach engenders various adversarial attitudes resulting in poor collaboration, growth of disputes and conflicts, and diminished focus on the requirements of customers and the need to satisfy client needs (Shash, 1993). Relationships in the tendering process have been improved through the integration of the supply chain in a bid to enhance project performance due to the fact that project participants have realized that sharing information and knowledge is essential for project success. Collaboration between different construction companies helps to ensure decreased building costs for the client and high profits for the contractor. This relationship also helps to enhance the probability of capturing the requirements of clients in order to recognize and protect the profit margin of the main contractors.

In this relationship, the main contractors are in charge of the construction of projects although they rely upon the services of specialist contractors and subcontractors to execute the tasks in a bid to increase efficiency, reduce operating costs, and achieve economic delivery of different projects (Harris & McCaffer, 2013). However, in order to ensure a successful tendering process, the construction companies must develop strong and enduring relations with specialist contractors and key suppliers rather than focusing on the need to maximize profits. This is not the case since most contractors often focus on their profit margin such that they select subcontractors based on the lowest price, an aspect threatens their survival (Griffith & Watson, 2003). Failure to realize that price is not an effective methodology of sustaining business transactions causes the development of negative attitudes, conflicts, and loss of profits in the long run. However, the teams that understand the importance of collaborating often benefit from contractual relations. Different teams often relate in this exercise including architects, project managers, engineers and designers, mechanical engineers, and building service engineers, among other specialists.

Factors that Influence Contract Relationships between Organizations Involved in Tendering.

Decision making in the tendering process is complicated owing to complexities and uncertainties in the outcomes. The contractual relationships between different organizations that are involved in the tendering process are often influenced by various factors that include the number of tendering competitors, the need for work, and individual organization’s experience on the projects. The risks involved owing to the nature of the task, the extent of difficulty, and current workload often influence the contractual relationships of the firms in the tendering process (Shash, 1993). These factors often influence the relationships since, tendering and bidding involves the use of physical resources, financial, and managerial resources. The ability to manage the contract is an essential factor that influences the relationship in that organizations are expected to benefit from long-term objectives. Other factors include the reputation and identity of the client, the necessary resources to execute the project, and the client’s ability to pay (Watt, Kayis, & Willey, 2009). The profit margin, the financial resources needed to execute the work, identity of other consultants, and available time to tender and execute the project also influence the contractual relationship between the organizations that are involved in the tendering process.

Construction Process and the Role of Building Information Modelling (BIM):

Modern Construction Processes and Sequences

Modern construction processes are the processes that have proper design and planning such that the project reduces the time and cost while promoting overall sustainability. Modern methods of construction entail the use of processes and products that improve building efficiency, customer satisfaction, sustainability, and environmental performance (Harris & McCaffer, 2013). The use of hybrid techniques that combine volumetric and panelized approaches is a modern technique that improves efficiency while reducing operational costs. The use of panelled units that are used produced offsite in the factory and assembled at the site is a modern technology that helps to produce a three-dimensional structure. Others include composites of mechanical engineering, foundation assemblies of pre-case concrete, roof cassettes, and innovative techniques including the use of tunnel forms.

These materials often respond to sustainability needs through improved efficiency to build more homes with the same amount of on-site labor. The on-site construction period also reduces by more than half. The performance of construction when using modern methods such as roof cassettes should be more efficient with the cost ranges being lower than normal. According to Akintan and Morledge (2013), these methods should promote sustainability through the reduction of risks and having a tight liaison with the necessary planning authorities. Other types of modern processes include precast flat panel system, twin wall technology, precast concrete foundation, flat slab construction, 3D volumetric modules, and concrete formwork insulation (Harris & McCaffer, 2013). For instance, the use of the precast flat panel system responds to sustainability needs by ensuring that repetitive construction activities are expedited through offsite assembly which also reduces the cost of operation and the need for onsite storage facilities.

Contract Planning Techniques

The most common planning techniques include network analysis, bar charts, linked bar charts and line of balance.

Bar Charts: Linked bar charts and bar charts are a common planning tool that shows the activities from the beginning of the project and beginning to the end of each activity. The detail of each of the activities in the bars is dependent on the projected use of the plan.

A typical bar chart – Source: Harris & McCaffer (2013).

Linked bar charts are also used to show the existing link between one activity and the preceding activities that should be completed before the commencement of another activity. The links and dependency between different activities help to ensure quick execution of tasks by reducing delays in the activities.

Network analysis: This analysis provides the ability to manipulate the planning data by linking the data in a network through a logic that defines different relations between the activities (Harris & McCaffer, 2013).

Network logic: This is a planning tool whereby activities are represented using arrows that are joined together through a logical relationship. In order to ensure the maintenance of the correct logic, the project manager must consider the activities that should be completed before the beginning of the activity and the activities that lack any logical relationship with the project or particular activity.

Where BIM Impacts Upon Operations and Construction Companies.

BIM has transformed the industry by improving construction, design, and project management, material management, expenditure, maintenance, and improvement of operations. BIM impacts construction companies by streamlining the interaction between different systems such as data management, mechanical, plumbing, and material management (Harris & McCaffer, 2013). Building information modelling also promotes maximum efficiency by enhancing communication between project managers and contractors. It is often utilized in both large and small scale to assist the builder from the design stage to the project completion by enabling the managers to share models with various subcontractors such as to ensure efficient pre-construction operations (Griffith & Watson, 2003). BIM enables various models to function in a single platform by eliminating the need for outsourcing or using varying packages. The ability of BIM to integrate data from diverse sources also enables the users to achieve the intended design and construction requirements of the project with ease (Bryde, Broquetas, & Volm, 2013). However, the construction team should be aware of the challenge of effective communication when using BIM between teams such as electrical engineering, drainage, structural engineering, and water, among others.

Development of Construction in terms of Innovation and Designs and the interrelationship with BIM.

The desire to meet housing demands has facilitated continued growth and innovation in the construction industry. The industry has evolved and refined its structure such as to accommodate a different set of skills and professionals in the structure. This innovation has facilitated the introduction of safety and health laws in both micro and macro projects as a result of increased knowledge of hazards and risks inherent in this sector. Continuous innovation has caused the construction industry to develop and form in diverse types, shapes, and routes of procurement. The industry has evolved such that it has become diverse in activities, scale, and nature of work with complex and highly fragmented supply chains and procurement routes. This continued growth and innovation have caused the industry to become wider, an aspect that has created the need for construction industries to focus on modern methods of constructions with the sole aim of understanding challenges and opportunities for the future. This includes long term skills that are required for future technologies in order to diversify and facilitate business growth (Akintan & Morledge, 2013). These efforts have been well integrated with emerging technologies such as BIM which has now become a common practice in both macro and micro-projects. The integration with BIM has facilitated the creation and sharing of information at the right time throughout the construction, design, and operation of buildings or facilities such as to improve the efficiency, effectiveness, and decision making. This has caused the construction industry to uphold a collaborative working culture between different professionals and parties that are involved in the assets lifecycle (Bryde, Broquetas, & Volm, 2013).  In the near future, the construction industry is expected to develop through the integration of technology and innovative practices to create an industry that is revered for a diverse and talented workforce, one that is technologically advanced and efficient, and promotes sustainability through low-carbon construction exports. The industry should also drive growth with clear leadership strategies.

Detailed Analysis of the Evolution of the Construction Industry

The UK construction industry has evolved and made significant improvement in relation to the structure, skills, organizational development, innovation, sustainability, and technology.  The UK construction industry has maintained a world-class reputation owing to its investment in professional construction services including the development of technology and innovations such as building information modelling in a bid to improve construction processes (Eadie, Browne, Odeyinka, McKeown, & McNiff, 2013).  Investment in education owing to the desire to meet consumer needs has facilitated an increase in the proportion of qualified employees. Professional development coupled with investment in technology such as BIM has caused the industry to benefit from an array of opportunities that are presented in the industry particularly with regard to growing interest in green construction in a bid to promote sustainability. Procurement and contract processes have also evolved since traditional procurement strategies are known to engender different adversarial attitudes, an aspect that causes poor collaboration, conflicts, and the possibility of shifting focus from the clients to a more profit-oriented strategy (Harris & McCaffer, 2013). This evolution has caused improvement in the relations and processes involved in the tendering process which has resulted in increased productivity and operational efficiency. However, although the industry has evolved through the years in terms of procurement procedures and construction methods, there is a need to ensure continuous investment in technology and innovation coupled with increased collaboration between research institutions and businesses to facilitate the highest potential in the industry.

Conclusion

The construction industry is considered one of the largest industries in the UK economy owing to its gross value, employment, and a total number of enterprises. The construction industry has influenced the economy through the provision of employment opportunities, increased the need for education, innovation, and continued efforts to promote sustainability and reduce carbon emission. The industry has evolved from the use of traditional methods of procurement, construction, and technology to advanced mechanisms that have integrated innovation strategies with BIM in a bid to increase efficiency and productivity. In the future, there is a need to improve the production mechanisms by implementing carbon-free strategies in order to promote sustainability while growing the economy.

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