ANDERSON'S MAXIM

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MANAGEMENT TOOLS, BIM AND THE "BUILDER"

Wednesday's Financial Times contained an interesting book review by Morgan Witzel titled a "A plain-speaking guide to modern management". The review starts off with:

"Key performance indicators. Balanced scorecard. Customer relationship management. Dynamic resource management. Most of us know these management tools and many of us use them every week, even every day.

But how effective are we at using them? Not very according to consultants Jeremy Hope and Steve Player. They estimate that these tools deliver what they promise and yield real benefit to companies in only about 30% of cases. The rest of the time, they say, we are merely spinning our wheels - or going into reverse".

Interestingly enough, on Thursday, I met with the 46 year old Vice President of one of the nations larger general contracting firms - a man whom I have known for more than a few years. Within that discussion, the VP lamented that, while there were many people actively embracing new technology, such as BIM, there often seemed to be a greater focus on working the technology to produce loads of data than on harnessing the technology (and its outputs) to produce positive results in the field. After all, says the self-described "builder", the objective is really getting the project BUILT and if the data does not effectively aid that then the effort spent in generating the data is wasted.

I hear a lot of hype about BIM and, while I am great believer in its benefits as a whole-of-life tool, I am afraid that what I actually see more often than not is more "smoke and mirrors" - glitter if you like - than substance / really useful output to help the projects succeed. I suspect that what Messers Hope and Player say about management tools generally applies equally to construction….."these tools deliver what they promise and yield real benefit to companies in only about 30% of cases. The rest of the time …. we are merely spinning our wheels - or going into reverse".

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SIGNS OF LIFE

Over the last three weeks there has been a solid trail of good news for the US economy.

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SORRY MR. PRESIDENT, BUT I DON'T KNOW WHAT YOU JUST PROMISED

In his 2012 State of the Union speech President Obama helpfully said;

"During the Great Depression, America built the Hoover Dam and the Golden Gate Bridge. After World War II, we connected our States with a system of highways. Democratic and Republican administrations invested in great projects that benefited everybody, from the workers
who built them to the businesses that still use them today.

In the next few weeks, I will sign an Executive Order clearing away the red tape that slows down too many construction projects. But you [Congress] need to fund these projects. Take the money we're no longer spending at war, use half of it to pay down our debt, and use the rest to do
 some nation-building right here at home.

There's never been a better time to build, especially since the construction industry was one of the hardest-hit when the housing bubble burst."

The President is 100% right that there has "never been a better time to build" and his promise to clear away red-tape is most welcome.  But without funding, what did the President really promise the construction industry?

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FUNCTIONAL OBSOLESCENCE AND FLEXIBILITY, KEYS TO DRIVING CHANGE

Bill Gates once reportedly compared the computer industry with the auto industry this way: "If GM had kept up with the technology like the computer industry has, we would all be driving $25.00 cars that got 1,000 miles to the gallon." Good job that he wasn’t thinking about the construction industry!
Let’s face it; change comes slowly to the construction industry. Like most industries (and technologies, businesses and political systems) the main determinants of change come primarily from outside; often from the customers.

Unlike consumer products which have a relatively short life cycle, buildings tend to be designed and constructed to last for decades if not for centuries. However, in my experience, designers tend to see buildings as a static, single use product rather than something that should successfully evolve through multiple uses over their lifespans.

So then does change come? It’s the consumers (the building owners and building end users) who should be actively pushing the importance of overcoming functional obsolescence and achieving flexibility.  Perhaps they should even redefine the terms "functional obsolescence" and "flexibility". Without the consumer driving the issue the industry’s natural inertia will win (again).

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FOR TRUE SUCCESS.....

Spent today working in the Auckland office of Rider Levett Bucknall.  Very nice group of motivated people all the way through.  On the wall in the office staff Break Room there are a number of quotes but this one struck me as being particularly poignant;

“For true success ask yourself these four questions: Why? Why not? Why not me? Why not now? .”
James Allen (New Zealander, Statesman, Minister of Defense (1912-20) - 1855-1942).

Seems like a worthwhile way of thinking about things.

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INTERCONNECTEDNESS - WHY THE EURO CRISIS IS IMPORTANT

This past Friday I was fortunate enough to be the guest speaker at the Property Council of Australia - South Australia lunch and in researching for the speech (titled "The US Construction Industry Crunch"), I came across some rather good information in the book "This Time Is Different: Eight Centuries of Financial Folly" by Carmen M. Reinhart which helps explain why we should ALL be worried about the Greek / European debt crisis.  Ms. Reinhart explains that:

• Banking crises in advanced economies significantly drag down world growth. The slowing, or outright contraction, of economic activity tends to hit exports especially hard.
• Weakening global growth has historically been associated with declining commodity prices.
• Banking crises in global financial centers (and the credit crunch that accompany them) produce a “sudden stop” of lending to countries at the periphery.
• Banking crises have historically been contagious,
• A banking crisis in one country can cause a similar loss of confidence in neighboring or similar countries, as creditors look for common problems.

That definitely got my attention - the trouble in Greece / Europe is actually important to us all.

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