Constructing Excellence report: Respecting your people leads to better business performance

It is surprising that the Respect for People (RfP) agenda has taken so long to become the key issue facing construction business leaders, given that many firms are struggling to find experienced, quality people with the right skills to lead projects.

Attracting the right people and keeping them has never been so urgent or so necessary. The trouble is spending money and time dealing with the so-called 'soft' issues relating to people has been seen as difficult to justify in a low-margin industry such as construction.

It's been a struggle, but organisations such as Constructing Excellence (CE) have fought to prove to the doubters that there is a direct link between treating people well and improved business performance.

To this end CE has commissioned an independent report from Leading Edge Management Consultancy into RfP. The survey team contacted all the 160 organisations that had submitted demonstration projects, subscribed to RfP, completed RfP KPIs, or received the tools free at the launch.

The organisations covered all aspects of the supply chain from clients, professionals, contractors and specialists to manufacturers. Large companies made up 60% of the sample and SMEs 40% (of which 15% were either small firms or micros).

Success of toolkits

The aim of the survey was to find out how they had got on with implementing the RfP toolkits originally launched by Rethinking Construction in 2002. The six toolkits are: health and safety equality and diversity in the workplace training plan work in occupied premises worker satisfaction and the working environment toolkit.

The report provides a seven-step guide to successfully implementing RfP tools and nine case studies. Learning points from the case studies have been captured and consolidated into a Checklist for Success.

The survey found that all sectors of the industry agreed or strongly agreed that RfP contributed a positive business benefit.

The greatest direct benefits were: improved staff satisfaction changed attitudes opinions in the working environment or conditions and practices improved morale and improved customer relations. Indirect benefits included reduced accident rates and higher staff retention.

Most users found the toolkits easy to implement. The most highly rated tool among managers was the Training Plan, while the workforce liked the Workforce Satisfaction tool best.

Commenting on the results, Peter Cunningham, director, Constructing Excellence, said: "We've always been fairly encouraged as to how well the Respect for People KPIs have done, especially on the demonstration projects. These findings bear testament to the effort that the organisations that have implemented the RfP agenda have got the fruits of their labours.

"The key thing is that the tools are highly rated. The commitment that organisations are showing to implement these principles has had a massive impact on those businesses. Employees can see their managers' commitment and, ultimately, managers get better value out of their construction teams, as they can deliver better value for clients by having a more satisfied workforce and better qualified employees."

While there is plenty of evidence that forward-thinking firms are implementing RfP on their own initiative, Cunningham said: "One of the key findings was the impact client leadership has by influencing their supply chains to utilise the RfP agenda."

Those that have been genuinely committed to their staff and have invested in this programme have better staff retention rates and higher staff satisfaction levels, according to Cunningham. But they have usually also invested in training. "Commitment to training is vital - it's not just a sense of training costing money, it's being willing to free up time for staff to go and do it," he said.

There is also little doubt that more clients, especially in the public sector, are demanding to see hard evidence of a commitment to the RfP agenda from their supply chain.

"Clients are very influential," Cunningham told CJ, "and they are now making RfP issues part of their procurement criteria. They are looking for evidence of KPIs, not just in terms of data itself, but the approach the organisation adopts. Clients want to see the figures, how they have been communicated to staff and what improvement actions have been put in place."

As social housing group Fusion 21, one of the report case studies, put it: "We want to work with contractors that have a motivated, well trained workforce. This gives us the confidence that they can help us deliver our partners' housing programmes."

Cunningham added: "The huge increase in partnering work means we are moving towards more collaborative working over longer periods, so if you want to be on these contracts you've got to be able to show these kinds of commitments to your staff and to the client."

Fusion 21 is a case in point. After seeing its first set of annual RfP KPIs, it said: "When we combined all our contractors' scores we saw instantly where they needed to make improvements. Overall, on average our contractors got a benchmark score of 85% for skills and qualifications and 84% for training. However, the figures dropped to 47% for staff turnover and 46% for sickness absence. This shows that the RfP KPIs really help you identify and then target areas that you need to address."

Cash benefits

The hard cash business benefits are there too Fusion 21 made savings of more than £5m during 2005-6, 11.3% of its total programme costs.

Asked to pinpoint the most difficult aspect of implementing RfP, Cunningham believes it is getting the buy-in from managers at the start of the process. "You've got to walk the talk, there is no sense in just going through the motions," he said. "One of the key things the toolkits provide is the consistency and application needed to make the implementation of RfP work. So, if you have a large organisation with several hundred managers, the toolkits provide the consistency of application and the measurements allow you to find out where it isn't being implemented properly."

Among the other key learnings revealed by the report are the needs for good communications between managers and staff in both directions, and the need to set realistic targets. "You won't get market-leading scores in just 12 months," Cunningham warned.

Summing up he said: "None of it is rocket science - nothing really is in construction."

True enough, but as Hillingdon Homes, another of the report case studies, puts it: "Use the toolkits because they give a framework and structure to the process. It saves you time and inspires you to move the process forward."

The report: Respect for People: The Business Benefits is available from today online: