Mountain climbers are rewarded with a view of the far horizon, the point where the sky meets the earth. Such a view can change our perspective and improve the decision we make day-to-day.
So, imaging for a moment you’re up high. Looking to the far horizon of the Australian construction industry. A few things might get your attention.
Focus on people
Firstly, there is a lot of activity being carried out by very busy people. People who are in demand, and not just in the industry, they are increasingly being attracted to other sectors altogether.
And when you look at these people, you might think about the challenges involved in retaining a quality workforce. Next you will probably think about the new people and capabilities you need to remain competitive.
To retain the workforce, there are a number of actions the industry should take.
The first is to upskill people. By upskilling people, we motivate them, and we allow them to grow, to contribute and take on more significant roles. This in turn motivates people further and they perform at a higher level.
Moreover, equipping people with greater leadership skills, deepening their technical expertise, and giving them a variety of projects to work on, goes a long way to achieving satisfaction and retention objectives. Especially when we note that lack of opportunities to grow is one of the main reasons people leave the construction industry.
And that brings us to the second action, which is keep the industry attractive. People enjoy being part of progressive companies and industries, industries that are looking at new and smarter ways of working, industries that simplify work and modernise. While not obvious, or necessarily expressed in conscious thought, this dynamic keeps people engaged and involved.
Critically, in the construction industry, engagement also comes in the form of giving people foresight regarding future work prospects. Giving people more certainty as projects complete is something everyone values, especially family-oriented workers, and it is something many other industries have to offer. While it is true that individual companies don’t control this, it nonetheless should to be factored in as much as possible when major infrastructure projects are planned.
The third people related action is to look after the health and well-being of the workforce. Construction work is physically and mentally demanding. Add to that the stress that come with working on tight budgets and schedules, the climate, travel and constant attention to detail. These factors influence job satisfaction as well as safety. So, it’s not hard to see that establishing a culture that understands and actively supports the health and well-being of the workforce is essential.
When it comes to adding more people to the resource pool, the industry has a lot of opportunity with apprentices and a lot more can be done on the gender diversity front, especially if we addressed retention issues. Indeed, it is conceivable that the industry will be able to attract workers from other industries.
Go digital or go home
When we turn our attention to technology it is immediately obvious that there is enormous potential.
First, we must reduce the complexity and problems with current technology platforms. There are many organisations that continue to live with waste in their processes and systems. In successful organisations, technology platforms and systems support the process, not the other way around.
Next, all players must be prepared invest in new technology to solve problems in critical areas of their organisation. Areas that breed frustration and show high levels of inefficiency. The technology exists to do it.
And, based on current discussions with industry executives, labour cost and risk management are hot topics. Imagine being able to simplify or eliminate labour intensive tasks with technology or inventing smarter design solutions that reduce or eliminate complexity. Imagine being able to utilise technology to anticipate and avert risks. Although not obvious, there are substantial productivity gains to be made and these in turn will help with the skill shortage.
The third action is to distribute the cost of investments across multiple projects over a few years. The standard response to this suggestion is “we can’t because our projects are different.” But if you really take layers of complexity off and analyse workflow, clear patterns emerge indicating a process. Processes that can be replicated across multiple projects and businesses, similar to payroll, recruitment and bidding – proving how the investment could be spread across projects over time. Repeatable processes are easy to automate, resulting not only in cost savings, but faster delivery, reliable decision making and fewer errors.
Another important action on technology investment is to again look beyond the horizon and develop systems that are not based on your past processes but your future needs. This is truly game-changing.
These more distant horizons need more thought, more consideration, but this sort of planning is exactly what will give you competitive advantages. And while companies can do this on their own, the industry has a role here to unify approaches across the entire value chain. Sometimes technology investments are restricted because of the archaic platforms suppliers or customers are using. The benefits of an improvement in the value chain will be felt across the industry.
The final action is to increase the technology content in training programs. Introducing technology and adapting to new ways of working will become easier the more technology literate our people become. Conversations with training partners, TAFE and even with technology suppliers will gradually make a big difference. Already the next generation of graduates is bringing high levels of technological competence with it, and so this generation’s ability to apply technology must be supported.
The confluence of people and technology is where the real benefit for the construction industry materialises. It is where you start seeing people interact with technology and seeing how work can progress more intelligently. And this is how, taking baby steps sooner, we will see a resolution to the widely talked about skills shortage and the less talked about, but related, productivity decline.
Industry associations must step up
Before concluding, it must be noted that the industry associations have a big role to play on two fronts.
The first is to increase the attention the government gives to the construction industry. For example, the government has growth centres for advanced manufacturing, cybersecurity, food and agribusiness, mining, oil, gas and energy but there is nothing for construction. Focus through such federal initiatives makes a huge difference.
And secondly, is the need to more effectively promote and encourage the use of the R&D incentives the government offers. While the larger organisations are using it, there is little to no use of the incentive in small to medium firms. A contributor possibly is the inability of contractors, largely due to lack of resource, to focus on R&D and innovation but that is exactly where the industry groups come in. They can facilitate collaboration between businesses as well as academia and deliver lasting value, looking beyond the horizon.
So, a more mature and disciplined approach is needed by the industry. The time and conditions are right for us to take the next steps and address not only skills shortage, but other challenges that the industry faces, one by one.
By Shivendra Kumar,
Shivendra Kumar is a master of business theory. But more than that, he is a master of practical implementation, having earned his stripes developing and managing business improvement programs with some of Australia’s leading engineering firms, including Downer and Siemens. His track record is one of solid, measurable productivity improvements, process innovation and revenue gain. Shivendra has also coached many executives and project teams, in real-world application of best-practice methods, ensuring his insights and know-how are passed on to others. Underpinning his extensive industry experience are qualifications in engineering, and a PhD focused on rapid product cost improvement techniques. He is the author of two books on business improvement techniques, The Competitive Contractor, and From Paper to Profit.