Offsite construction: Contractors lead the offsite drive (Special report)
00:00 01 Nov 2006
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The first Contract Journal offsite survey, carried out in association with offsite consultancy Mtech Group, provides some startling findings. Contrary to comon belief, it is contractors, rather than clients or architects, that are increasingly taking the lead in encouraging use of offsite technology. By Will Mann.
If most people believe that contractors are backward in looking forward when it comes to offsite technology, then they would be wrong. The first Contract Journal offsite survey, carried out in association with Mtech Group, underpins what those at the heart of the industry know only too well.
An overwhelming 85% of all survey respondents envisage using offsite technology more in the future, and most people are happy that the main board of their business is up-to-speed with offsite developments. But there is still some way to go if the offsite industry is to realise its full potential and make the leap from a 3% market share to a 30% share that the industry is aiming for.
The purpose of the survey was to find out what contractors think of offsite methods and to determine the current trends in terms of uptake, products being used, and feedback from users of this offsite technology.
The general consensus shows that, on the whole, experiences of using offsite construction technology are positive or very positive. More than 80% of the organisations taking part in the survey had used one or more of the offsite products listed, including light steel frame, timber frame and precast concrete, with around three-quarters using pre-engineered M&E services and kitchen/bathroom pods.
Less well used technologies included concrete formwork, structural insulated panels (SIPS) and pre-engineered foundation solutions. Only 60% of the survey respondents had used volumetric modular construction techniques.
Speed of construction and safety considerations appear to stand head and shoulders above the rest as reasons for choosing offsite. Cost, client requirements, lead time, staff ability to use the products and compatibility all scored very similar results, being important or very important to more than 70% of respondents.
Rather surprisingly, sustainability was not seen as being as important as all the other categories listed. Perhaps the sustainability message is not hitting home as firmly as might have been thought.
By far the most important aspect for consideration when specifying an offsite product for a project is speed of construction, with 95% of respondents stating that it was important or very important in their decision making.
Information services
Looking at the offsite supply chain, there are a number of trends emerging when it comes to the rating of the services and information provided. Information on building regulations and accreditation was seen as being the most comprehensive aspect of the services and information provided, perhaps due to the tight regulations in place in respect of third party accreditation of innovative building techniques.
This was followed closely by the services and information provided on the integration of offsite technology with other components, which maybe reflects the changing nature of the supply chain and the emerging trend towards hybrid offsite solutions, where a number of different offsite technologies are integrated into one build solution.
The provision of case studies was seen as being not very comprehensive, which is perhaps a message to the offsite industry that it is important to capture project experiences and be prepared to disseminate this information in a structured manner.
Both training and cost data were found to be lacking, which again sends out a clear message to the industry. And sustainability profiles were found to be least comprehensive, which is somewhat reflective of the lack of importance when specifying offsite technology that the survey results found. Perhaps it is time the offsite supply chain took the lead and developed more comprehensive sustainability information, rather than waiting for specifiers to demand this data.
Leadership knowledge
Elevating the perspective of offsite technology to the boardroom seems to have been done with some success. More than 39% of respondents stated that the main board of their business was very ‘up-to-speed’ with offsite developments. A further 59% stated that the main board of their business had ‘some knowledge’ of offsite developments.
In most instances the survey found that a director of the company has direct responsibility for offsite activities and innovation. Some 57% of the respondents stated that a managing director/chief executive or other board director has responsibility for offsite activities. Additionally, 39% stated that they have a specialist director or manager within the company who is responsible for applying offsite technology and innovation.
When it comes to making the decision whether to use offsite technology, more than half (53%) said it depends on the project. Interestingly, 31% of respondents stated that the decision to use offsite products on a project would be influenced by company strategy. Most surprising of all was the fact that only 16% of the decisions to use offsite technology were influenced by the client, which would appear to be a significant shift in the dynamics of this sector - typically it was more usual for the client to be the driving force for the use of offsite.
Many of the respondents provided additional views of the sector, which supported the general theme of contractors providing most impetus for use of offsite products.
Architectural reluctance
A number considered client architects reluctant to move away from traditional construction techniques, with one saying they “give little consideration to the opportunities for the application of offsite techniques”. A like-minded contractor felt that the “criticality of achieving an early design freeze was not always appreciated by architects”. Another respondent stated that “if the early design freeze was missed, then all the benefits of offsite construction are compromised”.
Clearly, contractors feel that architects should be taking a greater lead in terms of designing with offsite techniques, rather than leaving the contractor to find alternatives with the client and then translate the design to accommodate offsite solutions.
Finally, one leading contractor provided an astute summing up of the key challenge for the offsite sector in the coming years: “secure continuity in annual demand set against the availability of products that demonstrate real value”. It firmly lays down the challenge to offsite manufacturers.
Data charts
Why contractors like the offsite case
Attitudes to offsite technology are changing rapidly, with the decision to employ offsite solutions more often a strategic one than ever before. Darren Richards, group managing director at Mtech, believes the industry is at a real turning point with contractors taking the lead.
This is the first such industry-wide survey on the opinions and adoption of offsite technology in the construction sector, and the results provide some fascinating insights in to the needs and drivers of some of the UK’s leading contractors.
There was never any doubt that when the offsite supply chain could start to demonstrate the compulsive argument for moving away from traditional construction techniques, that contractors would sit up and listen. However, the time it has taken to reach this point is a frustration to all of us involved in the offsite arena.
No doubt a lack of tangible evidence has not helped this situation, but thankfully a handful of visionary clients and contractors over the past 10 years or so have been brave enough to try the technology and make significant leaps forward in performance against the backdrop of an increasingly competitive marketplace.
By showcasing the impact that offsite technology can have – and is having – on some of the sector’s most successful and profitable companies, we have been able to elevate the importance of these new methods to the boardroom, and the survey underlines this.
The fact that 96% of all respondents to the survey have in place a senior manager or director responsible for the strategic application of offsite technology is a significant step change in the focus of constructors.
Looking ahead
The results of the survey confirm our thoughts in terms of the future for offsite manufacturers, with an overwhelming confirmation that contractors envisage using more offsite technology in the future. This is perhaps the most pleasing statistic of all and one that will give confidence to the offsite manufacturers that have invested significant funds into production facilities, product development and third party certification of their products/ systems.
What is also clear is that a lot of work has yet to be done by the offsite industry to demonstrate the benefits of using the broad spectrum of offsite technology that is now available. Case study information is still lacking and this must be one of the challenges for the industry: to share and disseminate its success for the benefit of the wider construction community.
Many decision makers will remain sceptical about the use of offsite technology until they see a compelling body of evidence showing tangible commercial gain. Ongoing work by the industry body Buildoffsite (www.buildoffsite.com) should go some way to rectifying this situation. With more than 150 case studies currently in production, it would appear that the message is certainly getting through.
Training across the offsite sector was seen to be lacking and yet Mtech Training is witnessing an unprecedented demand for offsite masterclasses across a range of sectors, the most popular of which is currently the residential sector. Add to this the popularity of offsite manufacturing facility tours and it will not be too long before the specifiers and users of these offsite solutions will have all the requisite knowledge to apply these techniques with confidence. Interestingly, our statistics show that delegates for these masterclasses and tours are dominated by clients.
The development of an Offsite Benchmarking Forum to draw direct comparisons with traditional construction techniques will provide further evidence for the offsite technology business case. Most importantly, the cost argument must be won in the same manner that the speed of construction and construction safety arguments have been won.
Surprisingly, sustainability credentials do not appear to be an important factor in specifying offsite technology. And yet sustainability is a central plank in the government’s agenda on areas where major improvements could be made. Perhaps this is the next challenge for the offsite sector – to make the link between controlled manufacturing processes, reduced energy consumption, managed waste and recycling activities, and the significant enhancement of environmental performance of projects employing offsite technology at no extra cost or effort. Improved sustainability credentials are a given; a by-product of the offsite process.
Work in progress
Most encouraging of all, the survey demonstrates that a wide range of offsite technologies are being used, with most demonstrating positive or very positive experiences. Clearly the offsite toolbox is being opened and used with confidence.
Survey respondents confirm the industry trend for significant growth in the kitchen / bathroom pod and light steel frame manufacturing sectors, although surprisingly, few constructors have used volumetric modular construction – perhaps a step too far for some at the present time.
Overall, the survey clearly shows that attitudes towards offsite solutions appear to be changing at a pace. But the real breakthrough for the offsite sector is yet to happen. The growth of the offsite industry, which is currently around 30% year-on-year, has only now reached 3% of overall construction market share. The survey demonstrates that it is imperative that the offsite sector does not rest on its laurels and continues to develop the evidence base for using the wide array of offsite technology that is on offer.
For further offsite information go to: www.mtech-group.com.
[Contract Journal, 1 November 2006, pp 20-21]