CONTENTS

PREFABAUS 2017 CONFERENCE WRAP

UK THOUGHT LEADER MARK FARMER LED A DYNAMIC SPEAKER LINE-UP AT THE PREFABAUS 2017 CONFERENCE IN MELBOURNE, WHICH OFFERED AN EXAMINATION OF BOTH CHALLENGES + SOLUTIONS AND HIGHLIGHTED THE PRESSING NEED FOR CHANGE. BELINDA SMART REPORTS.

The expansive crystalline environs of The Glasshouse in Melbourne might be an unlikely setting for revolution, but as around 250 attendees gathered at the prefabAUS 2017 Conference in September, there was a clear sense, perhaps not of insurgency, but of a strongly shifting tide. More than one delegate at this year’s conference commented on a feeling of gathering momentum and growing maturity since the 2016 event in Sydney; the dynamic mood was encapsulated in the event tagline: “Growing. Innovating. Revolutionising.”

And it’s safe to assume that many in the a

udience would have recognised the tone of urgent transformation embodied in International Keynote Speaker, Mark Farmer’s opening talk. The author of the UK Government-commissioned Farmer Review of the UK construction industry, titled ‘Modernise or Die: Time to decide the industry’s future’, launched the conference with an unequivocal call to action. It was clear that the urgency of his presentation title, ‘Modernise or Die: The construction industry’s burning platform for change’, was more than a turn of phrase.

“The burning platform is real.”

International Keynote Speaker Mark Farmer’s conception of premanufactured value (PMV) is key to driving the move to offsite.
International Keynote Speaker Mark Farmer’s conception of premanufactured value (PMV) is key to driving the move to offsite.

 

“In the UK we’ve got a push to build 250,000 units per year by 2020. We currently build around 160,000 170,000 units a year. We have more leavers than entrants going forward, that means you’re going to have a capacity gap around the workers purely needed to do housing construction.”

“In the UK we’ve got a push to build 250,000 units per year by 2020. We currently build around 160,000 170,000 units a year. We have more leavers than entrants going forward, that means you’re going to have a capacity gap around the workers purely needed to do housing construction.”
Mark Farmer – author of the Farmer Review of the UK construction industry.

“While Australia’s overall workforce is younger, the market’s position is still an ageing one. You’re on the same journey as the UK. You may be slightly behind us but you’re still on that journey.”

In the UK, challenges had been further compounded by the threat of an exit of significant numbers from the construction workforce due to Brexit. Workers leaving the UK, which is characterised by high dependency on migrant labour in the construction industry, added to a critical state of affairs in the UK’s construction sector. The resulting capacity gap meant was a clear need to train and retain more talent, coupled with a “need to do more with less.”

SAFETY ISSUES A CATALYST
In the UK and in Australia, the safety of buildings was another trigger for change, Farmer said. “Necessity is the mother of invention and discontent is the father of progress.” He cited systemic problems with poor masonry in Scotland, meaning schools have had to be pulled down. And the fires at London’s Grenfell Tower this year and Melbourne’s Lacrosse Building at Docklands in 2014 had also proved to be game changers. Farmer outlined the most pressing delivery problems embodied in traditional models: too much re-design, too site based, too much contractual fragmentation.

TIME TO ACT
The UK is currently poised to undergo an accelerated construction program to pump prime the offsite industry, Farmer said. “Politicians know they need to act in the UK. It’s higher on the agenda than I’ve ever seen it in the last 30 years.”

“Politicians know they need to act in the UK. It’s higher on the agenda than I’ve ever seen it in the last 30 years.”
Mark Farmer – author, Farmer Review of the UK construction industry.

PRE-MANUFACTURING VALUE (PMV)
A central element of Farmer’s proposed solution lies in what he terms “pre-manufacturing value” or PMV. Principally PMV  means moving as much of a building’s final value away from the site itself. PMV is calculated as total construction price minus preliminary costs, OHP & risk allowances, and cost of site labour and supervision. It can be viewed as a proxy for cost, time and quality predictability, plus greater efficiency and speed.

It also has the advantage of moving ideas about offsite construction away from old concepts of “prefab” that carry a negative stigma in the UK.

Farmer indicated PMV would play a part in unifying government and industry in the UK. “One of the things I’m working with central government on and with London is to get everyone on the same page is to use my PMV definition as a policy tool. An advantage of PMV is its agnostic; it doesn’t matter if you’re using CLT, light gauge steel or concrete, PMV is just a measurable value. What I’m talking to the UK Government about is to use PMV and to set minimum PMV values for land disposal. We need to use PMV as a procurement tool that will drive a market response.”

BIM INSUFFICIENT IN ISOLATION
And while systems such as BIM were widely lauded as transformative, using BIM in isolation was not sufficient, he said. BIM needs to connect directly with the PMV delivery model to harness offsite’s potential. “BIM is not enough in isolation,” he said, adding that the whole system needs overhauling. “The parallel is that we need to change from analog to digital; otherwise it’s like putting lipstick on a pig.”

NEW SKILLS + CAREER PATHS
The new construction landscape would see hybrid skills become the way of the future; onsite robotics were already rolling out in the UK and the use of virtual reality (VR) interfaces with BIM was increasingly common.

“We need to make the production process digital and there will be new career families aimed at tomorrow’s professionals. It won’t just be about becoming a bricklayer. We need better aggregation of skills.”

“We need to make the production process digital and there will be new career families aimed at tomorrow’s professionals. It won’t just be about becoming a bricklayer. We need better aggregation of skills.”
Mark Farmer – author, Farmer Review of the UK construction industry.

Meanwhile, changing the funding regime for skills in the UK was a pressing need.

“One of the problems in the UK is that construction courses for traditional skills are expensive. One of the ways our funding works in the UK is that you’re better off training hairdressers and ballet dancers than construction workers[…] We’re trying to get that rebalanced […] Offsite could be one of the new career families in the skills space.”

GOVERNMENT INTERFACE WITH INDUSTRY CRITICAL
Governments in the UK and Australia clearly had a major challenge to meet, but would likely do so in different ways, Farmer said.

“In the UK we have different governmental structures. We have a very centralised Government Westminster still controls a lot of what we do around industrial strategy, funding for housing. The exception is London, which has a certain amount of devolution with the Mayor responsible for the housing budget and for an element of the skills agenda.

He’s able to get things done more quickly than the UK Government because he’s in control of less moving parts.”

“[In Australia] you need to get people together in a common environment beyond state boundaries. In Victoria you need to talk to New South Wales. You need to think about what commonality is, because what I’m seeing at the moment is the Mayor of London is starting to talk to central London around the fact that if he’s going to be commissioning offsite construction, maybe the factories that produce the manufactured content don’t sit in London, they sit in other parts of the UK, so there’s a need for a coordinated industrial strategy. The Mayor of London needs to talk to the Mayor of Manchester or the Mayor of Liverpool and central Government needs to be an aggregator for that.”

“[In Australia] you need to get people together in a common environment beyond state boundaries. In Victoria you need to talk to New South Wales. You need to think about what commonality is, because what I’m seeing at the moment is the Mayor of London is starting to talk to central London around the fact that if he’s going to be commissioning offsite construction, maybe the factories that produce the manufactured content don’t sit in London, they sit in other parts of the UK, so there’s a need for a coordinated industrial strategy.”
Mark Farmer – author, Farmer Review of the UK construction industry.

NEW WAYS OF FINANCING
New financial products were another critical need to foster offsite builds, Farmer said.

“In housing anything that’s non-traditional construction has been viewed with suspicion, by financiers, whether it be debt finance or investors looking to retain assets. There’s an educational process going on in the UK at the moment; institutions are getting around the table including chartered surveyors and big lending banks to determine future steps.

In the UK BOPAS (the Buildoffsite Property Assurance Scheme) is a big part of that. Essentially a BOPAS certificate allows you to get your product mortgaged and that is creating confidence in the market.”

AUSTRALIAN HANDBOOK AN EXEMPLAR
Significantly, Farmer praised developments in Australia around enhancing interoperability and streamlining learning around offsite methodologies, commenting that “MCCB in Australia is ahead of the game with the launch of the Handbook for the Design of Modular Structures.”

“MCCB in Australia is ahead of the game with the launch of the Handbook for the Design of Modular Structures.” Mark Farmer – author, Farmer Review of the UK construction industry.

TURNING THE OIL TANKER: CHANGE + CHALLENGES
Widespread transformation of the construction delivery model is necessary but will be slow and painstaking. “It’s like turning an oil tanker around. The radius of the turning circle is pretty large. This is a monster of an industry to change.”


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