Are you a chicken or an egg?

The off-site manufacturing industry has a problem. It has plenty of friends, but nobody - yet - wants to be its best friend.
Are You a Chicken or an Egg?
The off-site manufacturing industry has a problem. It has plenty of friends, but nobody - yet - wants to be its best friend. 

The broader housebuilding industry now seems to acknowledge that modernisation is at hand. Poor quality, aired like dirty laundry across the popular press in 2017, has undermined the faith and trust that consumers put into new build homes. Talk of the 'new build discount' is particularly concerning should buyers increasingly prefer secondary stock that has been 'debugged' by first purchasers. The problems are certainly more systemic than anecdotal. The problems are certainly more systemic than anecdotal. 2017 will be remembered as a low point for the housebuilding industry’s reputation, with build quality issues, safety standards and the leasehold scandal all hitting headlines over the year.  
Change is most certainly not for change's sake and it is not simply because Government wills it so. 

Change may be about a deeper commercial imperative to drive efficiencies. It may be about faster build times to secure an earlier income stream on IRR-driven models. Whatever the reason, it is overdue, it is coming - and that leaves us with the simple question of chicken, or egg?

No Joke  
"Did you hear the one about the labour force that crossed the road? "Of course not; nobody was left on site to hear the punchline."

If you weren't convinced by Farmer's eponymous Review, IPPR's recent missive brings home the labour force challenge. In short, we're stuffed. Skills training and apprenticeships have been pandered to for years and at a more basic level, as once contractor put to me recently 'construction just isn't sexy anymore.' Anymore - err, right. 

There are plenty of anecdotes around subcontractors walking off site to seek a higher bidder. Attracting the attention-span-of-butterflies millennials to the sector means a better offer has to be set out. Digital Construction must be at the middle of any solution.

2018 will see some disruptive forces at play with respect to off-site manufacturing. The innovators will battle cynicism and the fast followers will watch and wait. Legal & General’s long-awaited factory will come on-line, providing desperately needed depth and covenant strength to the off-site supply chain. It will also silence the naysayers who say the delays prove it’s all just too hard. 

By year end there will be some sense of the emerging winners and losers and to be clear, it isn't always the first-mover advantage that reaps the best commercial rewards. To want to lead, it matters very much whether your organisation is already feeling the discomfort of cost inflation and volatility, or whether speed of delivery is even desirable. 

In the end, this is merely a debate about the leaders and laggards, not the direction of travel for our industry. Board-level conversations need to shift so that they focus on how to start, not whether it’s a good idea.

So the question in 2018 is simple; are you a chicken or an egg?

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