Productivity Partnership Newsletter June 2013

FEATURE

ADDING VALUE TO THE CANTERBURY REBUILD

The Productivity Partnership is adding value to the Canterbury rebuild in a number of specific areas.

Materials supply

On 15 May the Partnership ran a workshop in Wellington with CERA and MBIE to understand the materials supply demand for the Canterbury rebuild. The workshop was attended by representatives of most of New Zealand’s major manufacturers and suppliers of construction materials, and provided the opportunity to collaboratively determine how to estimate the materials needed for the Canterbury rebuild in various building categories. Logistical requirements and potential risks to the supply chain were also discussed.

“This is about having the right materials, in the right place at the right time,” says Productivity Partnership Programme Director Peter Cunningham. “With competition for construction resources between Auckland and Canterbury, it is particularly important to get good information on the materials required in Christchurch to ensure supply meets demand. It was fantastic to have the people best positioned to provide that information together in one room.”

Projecting forward demand

The Canterbury Procurement Forum, a Partnership initiative, is hosting a market information day in Christchurch in early July to share the Canterbury Procurement Pipeline with all parts of the supply chain in the Canterbury region. The Canterbury Procurement Pipeline is a three-year forward view of major construction projects planned for the region, including public buildings, such as the new convention centre, commercial and residential buildings. It excludes infrastructure.

The Pipeline has been developed by the Partnership with input from major construction clients. “While the Pipeline doesn’t give the total picture of upcoming construction in Canterbury, it does give a good indication from a public sector perspective of the huge volume of work projected in the near future and when peak demand for resources is likely to occur,” says Peter Cunningham. “This information will help construction businesses with their forward planning.”

As well as presenting the forward work programme for the Canterbury rebuild, the market information day will include presentations from construction clients about their specific projects, and suppliers will have the opportunity to talk to them. The event is being organised with the assistance of the Central City Development Unit within CERA and Christchurch City Council.

Leveraging expertise

Assisting the Canterbury rebuild will be the first priority of the Centre of Expertise – Construction Procurement (CoE). The concept of the CoE originated in the Partnership and is being taken forward to support the management and co-ordination of the Canterbury rebuild, particularly public buildings, and capture learnings from Canterbury so they can be applied more widely. Also planned is a Rebuild Christchurch Charter specifying minimum requirements for rebuild projects.

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GUEST COMMENTARY

VALUE BUILDER – Waren Warfield

WAREN WARFIELD IS THE FORMER MANAGING DIRECTOR OF THE RESOURCE CO-ORDINATION PARTNERSHIP (RCP), THE LARGEST INDEPENDENT PROJECT MANAGEMENT COMPANY IN NEW ZEALAND. HE WAS SUPERINTENDENT’S REP FOR THE AMERICA’S CUP VILLAGE AND PROJECT MANAGER FOR THE EDEN PARK REDEVELOPMENT FOR THE RUGBY WORLD CUP.

Streamlining processes in the construction industry to improve productivity is a key objective of the Productivity Partnership and it’s also pivotal to rebuilding Canterbury fast.

If you want to speed up construction, how do you do it? I believe the answer is pretty simple. Working in partnership is the key – asking people to work outside their comfort zone and rewarding them for their efforts.

Streamlining processes in the construction industry to improve productivity is a key objective of the Productivity Partnership and it’s also pivotal to rebuilding Canterbury fast.

Whilst the initial assessment of earthquake damage, insurance settlements and land sale or land acquisition have taken some time to resolve, we can see lots of green shoots emerging from the rubble in the CBD, with construction of many significant new buildings planned to commence in 2014. This will put pressure on the industry to gear up to meet the demand and work efficiently to keep prices affordable and resources at a sustainable level.

TEAMWORK IS KEY

One of the early projects for the rebuild is the redevelopment of Burwood Hospital. It’s a $190 million hospital redevelopment that needs to be ready in two years to bring additional bed capacity into Christchurch. We want it rebuilt fast and well. I’m very mindful that anchor projects such as Burwood and Christchurch main hospitals are catalysts for other work to follow. We can’t delay starting them by doing things the traditional way.

For Burwood, we’re piloting many of the principles promoted by the Productivity Partnership and which are used in critical path planning. These include early involvement of contractors and the supply chain in the design, documentation and procurement phase of a project. This brings “build ability” into the design process and aids appropriate detailing with the input of product manufacturers. Working through the design process with contractors is invaluable. By thinking of different ways of doing things, the project team can move fast and save the client money.

We’ve moved to competitively tendering for every trade on an open-book basis. The builder shortlists the preferred candidates, does due diligence and looks at who can provide the best value for money and do the job the fastest. Pulling the project team together happens in parallel with the design process – there’s no need to wait until the drawings are finished. It’s important to choose people with the right attributes – builders with management skills and the foresight to help. Bringing teamwork to a project can take up to six months off a timeline and that’s what the recovery in Christchurch needs.

BIM BENEFITS

Another way to increase efficiency in the construction process is using BIM and other innovative technology. For the hospital projects, we’re using BIM to help get user group sign-offs. There are numerous clinical groups – from clinicians to support and admin staff. We can walk them all through a 3D living, working model of the building so they can see if it meets their needs. Designing in 3D gives clients a clear idea of what a building will look like and how it will function, early in the project design process. BIM helps us work faster and deliver a better result.

Using BIM also helps detect clashes and reduces the number of variations or changes occurring during construction. Working in a digital world helps every facet of project planning – asset management, maintenance, energy efficiency – it can be applied in so many ways.

Pushing productivity up by 20 per cent isn’t hard if you get everyone pushing in the same direction. For many businesses that means changing to a different, collaborative contractual model. You can do great things if you have the right team around you and incentivise them to perform.

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FEATURE

BIM WORKSHOP

Accelerating the application of Building Information Modelling (BIM) in the construction process is a Productivity Partnership priority. To assist this, the Partnership is working through the National Technical Standards Committee (NTSC) to produce an online BIM handbook for New Zealand.

“We expect that this constructors’ guide to using BIM will be a helpful resource for people right across the industry, including architects, designers, quantity surveyors, engineers and construction companies,” says the Partnership’s Construction Systems Workstream leader and NTSC member, Andrew Reding.

After reviewing BIM handbooks around the world, NTSC has commissioned NATSPEC of Australia to write the New Zealand version. On 7 May it held a workshop attended by 40 industry representatives to ensure the BIM handbook for New Zealand is tailored to our specific industry needs.

The workshop started with an update on the BIM accelerator strategy and GeoBuild Project and then moved into a session on the detail of the BIM handbook, capturing what people want to see in it and what it might look like.

The draft BIM handbook is expected to be released for industry comment within the next couple of months.

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FEATURE

AUCKLAND WORKFORCE ROADMAP FORUM

Gaps between workforce forecasts – how many workers will be needed – and competency forecasts – what skills will be needed – are a barrier to productivity. Business and industry leaders came together on 22 May to address this issue at the Auckland Construction and Infrastructure Workforce Roadmap Forum, organised with the assistance of the Productivity Partnership.

The purpose of the Forum was to initiate the development of a market-based workforce roadmap for the construction and infrastructure sector in Auckland and to ensure that funding of sector education and skills training are aligned with this roadmap. The workforce roadmap will help industry training and education providers meet workforce requirements.

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FEATURE

SUBMISSIONS ON MARKET STUDY WELCOME

You’re invited to help identify market-level barriers to competition and productivity gains in the residential construction sector. The Government is undertaking a market study of residential construction costs and has released an issues paper for public input. Hands-on knowledge of the sector makes industry feedback particularly valuable.

The study is part of a range of measures the Government is taking to improve housing affordability.

“The issues paper and market study are about identifying why some house construction costs are as much as 30 per cent more expensive than Australia and how we can get costs down,” says Housing Minister Dr Nick Smith.

The issues paper focuses on two main areas: potential barriers to effective competition in the building materials and services market, and factors to improve the overall productivity of the residential construction sector. A report on proposed solutions is due to be considered by Cabinet in September.

Submissions on the Residential Construction Sector Market Study close on 10 June. To view the issues paper and find out how to provide feedback, go to www.mbie.govt.nz/about-us/consultation/residential-construction-sector-market-study

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FEATURE

SKILLS LEADERSHIP GROUP ESTABLISHED

The first meeting of the Skills Leadership Group was held on 20 May in Wellington. The establishment of the Group has been spearheaded by the Productivity Partnership.

The inaugural meeting agreed the Skill Leadership Group’s terms of reference. It aims to meet three times a year to plan, monitor, promote and seek feedback on the implementation of the Built Environment Skills Strategy. The Group’s membership, drawn from ITOs, education and training providers, industry bodies and construction companies, will ensure ongoing industry input to the Skill Strategy’s implementation.

The Skills Leadership Group has identified two priority projects. The first is a project to develop supervision and management skills in small-to-medium enterprises (SMEs) in the building and construction sector. “We know there is an urgent need for SMEs to upskill in these areas to improve sector productivity,” says Skills Workstream Leader Ian Elliott.

The second priority project involves identifying the many government resources and tools available to help SMEs run their business. “There are loads of excellent resources, including websites and apps, produced by government agencies that are relevant to SMEs but they are spread far and wide,” says Ian. “They cover everything from regulation and taxation to employment and immigration matters. Essentially, we’re herding these together and feeding information about them out to SMEs to make them more readily accessible.”

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PARTNERSHIP PEOPLE

ANDREW REDING

LEADER OF THE PRODUCTIVITY PARTNERSHIP’S CONSTRUCTION SYSTEMS WORKSTREAM, WASTE HATER AND INNOVATION LOVER.

Andrew Reding doesn’t mince words when it comes to what’s needed to help lift the productivity of the building and construction sector.

“I hate waste and there are plenty of things that can be done to cut out waste in New Zealand’s construction industry,” says Andrew. As head of the Productivity Partnership’s Construction Systems Workstream he recently led a project to identify where time is wasted in the construction of residential buildings. The findings of the value stream mapping project can be used to help build houses more efficiently.

Andrew has been involved in the construction sector for 11 years and has a passion about seeing things done more efficiently, especially through greater use of innovative technology.

“I love innovation and new ways of doing things when they deliver a superior outcome. Building Information Modelling (BIM) can do more to improve productivity than any other single thing,” says Andrew. “It changes the nature of the field on which you’re playing. All other improvements are small steps which, taken in total, can make a difference. BIM can make a huge difference in its own right.”

Andrew’s “provenance” includes an English childhood, training as an accountant then moving into engineering on the marketing side. After completing an MBA he managed a scaffolding business and worked in logistics systems in Germany. New Zealand called and he spent six months consulting with Lion Nathan. He joined Fletcher Challenge in 1995 as business development director for the Concrete Industries Group. “We bought up operations in South America, India, Fiji – it was all go,” says Andrew. Two years later he was made Managing Director of Fletcher Wood Panels and then Chief Executive of the Building Products and Steel Group in 2001. Andrew joined the Rank Group in 2006 where he became President and Chief Executive of Evergreen Packaging Inc in the USA and Carter Holt Harvey Pulp, Paper and Packaging in Australasia.

Since semi-retiring in late 2008, Andrew has used his extensive knowledge for the good of the industry. Off the tools he is a keen chess player, reader and regular gym rabbit. Based in Auckland, he enjoys yearly trips to Italy to see his mother. He is Chair of the Auckland branch of the NZ Shareholders Association.

Asked what difference he would like the Productivity Partnership to make, Andrew says that streamlining local and government regulations and simplifying construction processes, in tandem, can make a significant difference to productivity. But the last word has to be about BIM.

“When BIM feeds into the bigger GeoBuild picture of using freely available digital information in the construction industry, the boundaries are limitless.”

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