Intelligent procurement – it can be achieved

By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

Everyone knows how hard the industry, particularly the North East, was hit during the recession, when changes to public sector procurement and the creation of single-sourced frameworks resulted in many companies being excluded from tendering, often on turnover alone.

Although frameworks were sold to government as a chance to save money, this approach has since been shown to be flawed in many areas.  Even now, we don’t need to look far to see evidence of misguided procurement practice resulting in companies simply running out of cash. When decision-making is based on lowest cost/minimum regulatory requirements it can be a recipe for disaster, taking no account of future costs.

It was great to see a huge turnout once again at our annual Constructing Excellence Awards. It just shows how much support the industry has, especially here in the North East. Construction Alliance NorthEast has always been a huge supporter of CENE and I am pleased to hear it is making an impact on regional procurement outcomes.

CAN launched in 2016 to primarily address the issues surrounding fairer procurement, it aims to create a more level playing field for regional SME contractors when tendering for public sector work.  Their reasoning is that the more contracts awarded to regional contractors, the better it is for the long-term future of the sector and a more sustainable industry generally. For me, it makes complete sense.

So, when North East Procurement Organisation (NEPO) began working on its documentation for its next Building Construction Works framework a couple of years ago, CAN worked closely with NEPO to ensure that local companies were not filtered out at an early stage in the process. Instead of turnover, they encouraged NEPO to focus on other key areas such as added social value; the creation of different value bands, up to £2m, between £2m-£5m and over £5m – companies only being allowed to bid for either the high or low bands, not both.

One year after the successful bidders were announced, I am delighted to see that out of almost £30m worth of contracts already tendered, local companies have picked up a significant share of the work, including wins by CAN members, Brims and Esh.  Most importantly, regional companies now account for 70% of those on the framework and they are also able to bid for a further £34m of imminent pipeline contracts, plus further work in the future.

 

This all goes to show that when effective collaboration takes place, intelligent procurement results. Thanks to the willingness of NEPO to collaborate and be open to advice, a shift in procurement policy was possible. We need more of this to ensure a healthy construction industry in the North East – it CAN be achieved!

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk.

National Women in Engineering Day

By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

National Women in Engineering Day (NWED), which takes place next Sunday, highlights the opportunities available for women in engineering. The event takes place every year on 23 June and aims to raise the profile of women in engineering across the world. It’s your chance to get involved with this year’s theme of #TransformTheFuture.

Even though the engineering industry is now more diverse than ever before, there is still plenty of work to be done to boost female uptake and essentially, Transform the Future. Only 11% of the engineering workforce is female and while I’d love that number to be much higher, it is still an improvement on previous years so things are getting better, just much slower than we would like.

The UK shockingly has the lowest percentage of female engineers in Europe and as it stands, this isn’t set to rise any time soon. The UK needs to significantly increase its number of engineers. The STEM skills shortage is costing businesses £1.5bn in recruitment every year. For the engineering sector to reduce its skills shortage, it needs to employ around 186,000 recruits each year until 2024.

 

There is a clear move towards embracing inclusion and demolishing stereotypes within the industry at the minute. There are initiatives and people are working towards encouraging more women into the industry, but we could and need to be doing more if we’re to get anywhere near getting the recruits the industry needs in the next five years, not to mention the fact that a gender diverse workforce drives innovation and improves business.  We need to make sure we’re promoting the industry to women when they are still at college and encourage them to take STEM subjects is another way forward. The engineering industry is exciting and has so much to offer, so we need to ensure that this message is getting out to schools and to the wider public.

This year we’re celebrating 100 years of the Women’s Engineering Society, a charity and professional network of female engineers, scientists and technologists. The charity supports and inspires women to achieve their goals in the industry, encouraging education and supporting companies with gender diversity and inclusion. That’s 100 years of challenging stereotypes and encouraging women into higher positions; the fight has been going on since long before many of us even realised there was an issue.

With the skills shortage at a high, we’ve realised we’re in no position to be looking at anything other than level of skill and potential when recruiting workers, we need people from all backgrounds. Equality and inclusion should be a priority in every business, and we’re certainly working hard to ensure that this industry is no different.

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk

Investing in our workers

By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

The Construction Leadership Council’s (CLC) Skills Workstream last week published its Future Skills Report, urging contractors to hire more employees directly.

According to the report, industry workers do not receive enough training and the best way to tackle this issue is for contractors to hire more people directly. I think we all share the same concerns over the future skills shortage and the report expands on this. Given that 30% of the workforce is set to retire over the next ten years and the end to Freedom of Movement after Brexit is looming, I think it’s only right to be concerned. Thankfully, the report has put forward actions to make sure the industry doesn’t suffer.

The report calls for clients to agree a code of employment where those who contribute to a project are directly employed. That way, it’s in the employer’s best interest to train staff and benefit from their improved productivity. This echoes the 2016 construction strategy report which said the sector suffers from fragmentation, pointing out that 99% of construction businesses are SMEs. This is long overdue. Direct employment not only improves productivity, it reduces accidents and helps ensure workers are trained correctly. This needs to be the beginning of tackling the hire and fire culture which currently distorts the reputation of the industry.

The report also wants smart construction methods to be encouraged through early design and procurement processes, promoting the use of digital technology and advanced manufacturing techniques. This will create the demand for skilled employees which will hopefully drive employers to invest in training appropriate to the emerging skills and construction processes. Industry qualifications and training should be updated to include skills associated with new construction methods. It’s the only way to ensure the workforce and industry is equipped for the future.

It’s no secret that there are a number of challenges facing the industry, many of which will get worse after Brexit, but we need to ensure we’re taking actions and doing all that we can to avoid the skills shortage being so significant in the future.

Research shows that projects with higher levels of direct employment often work better, the workforce is more engaged, and the client tends to be happier with the final product. The industry is changing, we all know that. We’ve accepted new construction methods and are getting to grips with offsite manufacturing. We just need to invest more in our people, ensuring they have the right training to see us through the next decade, which I personally think might be our most challenging yet.

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk.

World Environment Day – climate change and the industry

  By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

Yesterday we celebrated World Environment Day to encourage awareness and action on protecting the environment. Because of what we do, our industry has the potential to cause a lot of damage but that also means we also have huge potential to make a difference on protecting the environment.

 

We are always thinking of new innovative ways of being efficient and we’ve really stepped up our game in the last few years. Offsite construction is now becoming more common, we’ve got PopUp Houses, plastic roads, even a ‘bubble’ building here in Newcastle, all of which are playing a part.

 

Last week, major contractors were among more than 120 business leaders who wrote to the prime minister to urge the government to adopt a target for net-zero greenhouse gas emissions in the UK by 2050. Skanska, Cundall and Willmott Dixon were among those who signed the letter to the PM. The letter highlighted how many companies were adopting more energy efficient practices and setting their own net-zero targets. I think what the letter shows, is that the climate crisis is becoming such an issue that it’s now being discussed in boardrooms with more and more businesses calling for a net zero carbon country. Given that the built environment, including construction and property, contributes 40% of the UK’s carbon footprint, I’m so happy to see so many industry professionals signing this letter.

 

The UK Green Building Council’s new report aims to build a consensus about the actions we need to take, looking at whole-life carbon impacts of both new and existing homes and buildings. Previously, zero carbon policies focused only on operational energy and modelled performance in new buildings, so this is a significant change. However, currently a building’s energy status isn’t based on the materials used during construction and that’s what we need to change. While the aesthetics of a building are still important, we need to consider the materials we’re using and their wider impact. We need more recycled and manufactured materials used in a way that’s environmentally friendly.

Changes are happening. People are finally taking responsibility in how they work and their efforts to tackle the climate crisis. We’re looking at new building methods, new materials and technologies – all of which can reduce emissions. Skanska has pledged to become a carbon-neutral business by 2045 and other businesses have committed to a net-zero or net-negative carbon pathway. We made history by becoming the first country to introduce a legally binding framework for tackling climate change when The Climate Change Act received royal assent in 2008, I say why stop there?

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk.