The Purpose of the Strategy for Sustainable Construction - Case Study Example

Introduction The construction industry in the United Kingdom is one of the industries known to produce much waste to the environment. The industry uses the highest tonnage of solid material resources than any other sector over 400 million tonnes. In addition, the demolition & excavation (CD&E) sector produces more waste in England than any other sector. Yet the industry is significant to the United Kingdom economy as it accounts for between 9 and 10 percent of the Gross domestic Product (GDP). In view of this, the United Kingdom government has taken steps to ensure that firms involved in construction effectively manage their waste. Since 2006 several policies have been implemented to effect this. For instance, the Waste Strategy for England 2007 highlights the good potential to increase resource efficiency in construction and minimize waste. With the changes in the construction industry regulations construction firms have to adjust their processes in order to fulfil the new requirements. According to Hussey (2000, p.1), change is one of the most crucial aspects of effective management. The need for change in organisations is necessitated by the fact that the business environment is turbulent – requiring new operations strategies, compliance to new laws and so forth. Whatever the magnitude, change has to be managed effectively and astutely. Hussey (2000, p.1) notes that badly managed change situations can lead to serious consequences. One of such consequences is the frustration of otherwise sound strategies. Here, it is possible that many of the plans may not be implemented often because the change process is poorly managed. The corollary of thus can be extra costs, missed opportunities, and often times damage to the existing activities of an organisation. The second aspect is that the costs of implementation of projects may rise. This arises as a result of delays, spoilt work and emergency action to reduce the impact of delay. This can be very costly in large constriction projects. The third point is that benefits expected from the change process may be lost is the change is poorly implemented. For instance, competitors may have an advantage over contracts, which may affect the overall performance of one firm. Against a background of the above information, this paper aims to highlight the changes that have taken place within a construction company dubbed ABC Construction. The paper evaluates the changes the company has had to under go since the Government’s Waste Strategy for England 2007 was implemented. The paper also discusses other changes including the Site Waste Management Plans (SWMPs) requirements and how they have affected the operations of ABC Construction. Generally, the paper highlights how effectively ABC Construction has managed the changes it has had to undergo (such as various applications of total quality management) and whether the changes have been successful in meeting the company’s objectives. Based on these, the paper recommends the necessary changes that need to be implemented within the company in future. Changes in the construction industry in the United Kingdom over the last five years Changes that occur during a project can be gradual or radical depending on the extent of severity. Gradual changes, also known as incremental changes, happen slowly over a prolonged period and their intensity is low. On the other hand, radical changes are sudden and dramatic and have marked effects. Gradual changes often occur during the design development stage, where many decisions are made and refined progressively. In contrast, radical changes occur more often at the end of a particular project and thus require post design development (Engineering and Physical Sciences Research Council, EPSRC, 2004, p. 7). The changes discussed in this paper are mainly gradual as they are pre-meditated and are spread over a long span Key changes in the United Kingdom construction industry within the last five years include the implementation of the Waste Strategy for England 2007. The main objectives of the wastes strategy for the construction sector include (1) providing the drivers for the sector to improve its economic efficiency by generating less waste from design and demolition, (2) treating waste as a resource, recycling and re-using the more, and requiring contractors to engage in greater use of recovered material; and (3) improving the economic of the recycling and re-use sector by increasing demand promoting investment in the treatment of waste (Department for Environment Food and Rural Affairs (DEFRA), 2009). Construction companies also have carry out their operations in line with the Strategy for Sustainable Construction and implement the Site Waste Management Plans. Strategy for Sustainable Construction The purpose of the Strategy for Sustainable Construction is to provide clarity around the existing policy framework and signal the future direction of the Government policy. The Strategy thus aims to realize the shared vision of sustainable construction by offering clarity to business on the Government’s stance by integrating wide-ranging regulations that relate to sustainability; putting in place and committing to higher standards to assist in achieving sustainability in certain areas; and making specific commitments by Government and the construction industry to take the sustainable construction plan forward To deliver the Strategy for Sustainable Construction, the Government has collaborated with the industry to devise a set of overarching objectives that relate to the means and ends of sustainable construction. The means describes the processes that help to achieve the set objectives, while the ends relate directly to sustainability issues including climate change and biodiversity (Department for Business Innovation & Skills, 2010). The overarching targets for construction industries or the means are spread within the procurement, design, innovation, managing people and better regulation; whereas the ends include climate change mitigation, minimisation of water use and conserving the same, biodiversity conservation, proper waster management and sustainable use of materials (Department for Business Innovation & Skills, 2010). The key areas that can be seen to be addressed by the Strategy for Sustainable Construction innovations in design, proper people management, including increasing organisations’ commitment to a planned approach to training (i.e. training plans, skills pledges, investors in people and other business support tools, life long learning and continuous professional development), and investing in environmentally-friendly construction practices. The implication of the above statements is that ABC Construction has had to a lot in processes that ensure that the required changes are attained. Thus, the company has made various changes in its approach to quality management to march the requirements of the Strategy for Sustainable Construction as well as the Waste Strategy for England 2007 and the SWMPs. Aspects of total quality management in the construction industry As construction projects are growing larger and more complex, and the construction regulations change, clients are also increasingly demanding higher standards of delivery. Total quality management (TQM) is recognised as a successful management tool in the construction industry as it can help to increase quality and productivity (Pheng and Teo, 2004, p. 8). The benefits of implementing TQM, expectably to manage change, include reduction in quality costs, improved employee satisfaction, recognition by clients, successful start and completion of work, improvement in subcontractors’ quality management systems, and closer relationships with suppliers and subcontractors (Pheng and Teo, 2004, p. 8). TQM is also an approach that helps improve the effectiveness and flexibility of business as a whole. It is fundamentally a way of organising and involving the whole organisation, all the departments, every activity, and every individual at each level. In order for an organisation to be truly effective, each of its parts must function properly together, being cognisant of the fact that every person and every task within the organisation is affected by others (Egan, 1995, p. 98). In order for TQM to be successful as a means of implementing change, performance measures have to be reflected through top management commitment, customer involvement and satisfaction, creating strong customer-supplier relationships, empowering and involving employees, and improving processes and management. There are a number of issues which make it difficult to implement TQM in a construction organisation such as ABC Construction. These are discussed next. Product diversity: The difficulty here lays in the fact that buildings, unlike other products, are unique. Conventionally, quality is thus perceived as consisting of those features that meet the personalised needs of the customers and thereby offer product satisfaction, coupled with a provision that they are free from deficiencies. ABC Construction has overcome this by entrenching consistency in its works, in that even though construction projects are not similar, the end products can be evaluated against the benchmarks set by the Government. Organisational stability: The construction industry is featured by many organisational collapses, particularly during times of economic downturn. Since commitment toward TQM strategies and policies may take several years to offer the expected payoffs, it ay be perceived as a futile attempt of misdirection of resources. This is worsened by the fact that teams that are especially formed for certain projects may cease to exist soon after the ends of their contractual obligations – hence it is difficult to determine the impact of certain changes within the organisation. Misconception about the cost of quality Cost of quality refers to the costs associated with conformance to the requirements as well as the costs associated with non-conformance to requirements. In the construction industry, costs are being compounded by apprise and preventions costs, coupled with the costs of non-conformance. This implies that contractors may perceive TQM as a cost even though it is not the quality that is costly but rather the non-conformance to the required quality that is expensive. The costs associated with TQM in the construction include the expenses of rework, reacting to customer complaints, correcting errors, missing deadlines and having deficient project plans due to poor planning (Pheng and Teo, 2004, p. 9). Changes due to the Waste Strategy for England 2007 The Waste Strategy for England 2007 is aimed at fulfilling a number of aims. First is to reverse the unsustainable consumption of natural resources. Secondly, the Strategy aims to reduce waste. Third is to reduce waste by making products using fewer natural resources. This also aims at breaking the link between economic growth and waste growth. Importantly constructions companies should re-use or recycle the materials they use to enhance sustainability. Organisations are thus required to change their processes to ensure that waste prevention is given the first priority, followed by reusing and recycling of used materials, as well as energy recovery from various processes. Disposal of materials should be considered the very last option (DEFRA, 2007, p. 9). The central government of the United Kingdom realised the need to enable each part of the society to take responsibility, and hence show leadership through reducing its own waste. This means that construction organisation have to follow the example reduce their waste as much as possible. ABC construction has thus adapted to change mainly due to external drivers such as government requirements and the need to remain competitive. However, internal drivers have also ignited a change in response to the Waste Strategy for England 2007. These include subcontracting efficiency boosters the need to have competent staff to deal with the ever changing construction business environment. These are some of the factors also identified by respondents in a research conducted by Tiit Elenurm (2007) in Estonia regarding business competitiveness in Europe. Human resource practices within the organisation and process considerations are also internal drivers of the change process (McGuire & Hutchings, 2006, p. 196). ABC Construction has also had to implement a plethora of other changes to meet the current and future requirements of clients and the government. It has embarked on recycling and recycling materials obtained in demolitions to avoid unnecessary depositing of materials in landfill. To achieve this, the company has trained professionals who can determine the exact amount of materials required to avoid wastage. In addition, materials such a metal windows from demolished structures can be re-used to avoid re-ordering. The company also employs just-in-time delivery strategies to further reduce waste that may be created by improper storage and due to weather. This strategy is also recommended by Sustainable Build (2010). ABC Construction has trained staff to be knowledge in areas such as occupancy waste reduction, which employ methods such as gray water recycling, compositing toilets, and on site food compositing. As there a land fill tax imposed by the United Kingdom government (Sustainable Build, 2010), ABC Construction strives through all levels to ensure that it emphasises on environmental responsibility. Changes due to the Site Waste Management Plans (SWMPs) The purpose of SWMPs is to address two main issues. First is to improve the resource efficiency of materials by promoting economic utilisation of construction materials and methods so that waste is reduced and any waste that is released is re-used, recycled or recovered in other forms before it is actually disposed. Second is to reduce fly-tipping by limiting the opportunities available for the illegitimate disposal of waste by complying with existing legal controls ad offering a detailed audit of any waste that is recovered from the construction site. It is a legal requirement to write and ensure that a SWMP is implemented, and the greatest cost savings are likely to be attained as a result of consideration of resource efficiency of the materials in use, which will be a necessary component of the preparation before the SWMP is actually prepared. Salient features of SWMP and how ABC Construction strives to implement them Construction companies need a SWMP if the construction work to be involved will cost more than £300,000. SWMPs can save construction companies money, but only if the companies use them to challenge the ways they use their resources. That is, company such as ABC Construction can use the SWMP as part of its TQM to avoid the costs of non-conformance. As it was discussed earlier, costs of non-conformance are more severe than the costs of quality, as that means fines by the government, redesigning of works and so forth. ABC Construction has thus invested in personnel who ensure that waste is minimised from the outset so as to save money on materials, labour, disposal costs. The company’s personnel also track the waste produced in all processes and log all the waste records in one document. This helps the company to comply with the waste duty of care and minimise the risk of fly-tipping, which was a common occurrence in the past. Even though SWMPs will save the construction industry a lot of money, it is worthwhile to ensure that all the projects that are conducted produce suitable plans to maintain a level playing field. In addition to minimising waste, SWMPs record how waste is disposed of, recycled, re-used or recovered in other ways. Disposal or recovery techniques must comply with the waste management licensing system, that is, the waste duty of care and water carrier legislation. Thus it is expected that SWMPs will help in improving awareness and compliance with the existing as well as new legal provisions. In line with this, ABC Construction has had to recruits more personnel that are well-versed with environmental regulations to ensure compliance with the new legal provisions. SWMPs apply even in cases involving demolitions and excavations. This has meant that since 2008, when the SWMPs came into force, ABC Construction has had to hire more skilled and experienced engineers to ensure that demolition and excavations works are carried out within the SWMP framework. More staff are also required in other project developments such as installation and maintenance or removal of all related services such as gas, electrical, water, communications and sewage. How effectively the process of implementing the change has been managed ABC Construction’s change process has been multidimensional as it has had to adjust the structures and mechanisms of several of its departments. Brook (1980) identified five areas variables that are critical to the success of organisational change. The five are the aims and objectives of the organisation’s management, the people involved, the technology being applied, the range of control in the environment and the current structure (Cited by Hutchin, 2001, p. 23). When handling the forces that act or an organisation, the structure of that organisation has an important bearing on the way in which it responds. Generally, it is implies that if an organisation and the environment in which it operates are about to change then it is likely to need a change within itself in terms of culture and structure if it is to remain competitive and adaptive (Hutchin, 2001, p. 23). The change process at ABC Construction has mainly been caused by the need to comply with new government regulations with respect to construction operations and standards. As such, the organisational environment has had the greatest impact on managing change at the firm. This has in turn meant that the company has had to introduce new technologies into its operations, re-train its staff and hire more, and generally change its organisational structure to comply with the new regulations. Several tasks have also had to re-modelled to incorporate the new directives that emphasise on minimising wastage of materials, recycling, re-using and recovering. Importantly, there has been need to develop a new culture as a way managing people and embracing the ongoing changes. These ideas can be summarised in a diagram form as indicated in Brook’s change organisation model (Figure 1). Figure 1: Brook’s change organisation model Source: Hutchin, 2001, p. 23 Challenges of managing the change Like all new ventures in business, change is associated with a number of risks. There are four structural and cultural factors associated with risk-taking as for the case of ABC Construction. These are: Organisational expectations in which managers need to clarify what changes are taking place, why they are necessary and the anticipated outcome of those changes. Reward systems whether they are formal or informal Support systems – which apply to the overall workforce The nature of resources available to enable the project implementer to come up with a working system. ABC Construction overcame the risks mentioned above by asking its staff to be innovative; that is, trying new tasks, skills and work methods at al levels to make the required change work well for themselves and for the organisation. Essentially, all innovations have been focused on coming up with new sustainable technologies of construction so as to protect the environment from unwarranted pollution and increase the appeal of new project designs to new customers. Another challenge has been to come up with technologies that are competitive yet well understood by the market. A major challenges that is that those managers who deal with technological change must serve as both technological developers and implementers. Within the construction industry as well as in other industries, the general rule is that one organisation develops the technology and then hands it over to the users, who are less technically experienced but arguably knowledgeable abut their own areas of application. ABC Construction has dealt with this challenge by ensuring that clients are informed about the new construction technologies, their uses and significance. Key areas in which the company has succeeded include advising clients on the importance of green development and other technologies such as grey water recycling and toilet composting, which were not characteristic of past building designs. The company experienced significant resistance to change from employees who were opposed to new training schemes and advanced technologies such as designing the SWMPs that required a high level of engineering skill. To deal with this, the company opted to train people on the job and introduce new technologies in phases so as to integrate the new technologies into existing systems progressively. Thus the strategy was effective as it enabled the company to not only comply with the new government regulations but also maintain its competitive position as long as bidding of contracts is concerned. Along this line, further changes need to be carried out by investing in latest equipment for large scale sustainable construction as the existing ones have a limited capacity given the new challenges. Conclusion Significant changes have occurred in the construction industry in the United Kingdom over the last five years. Key among these the changes include the increase in regulations that aim to encourage sustainable construction. Construction industries have also had to adapt. This paper has analysed hypothetical case of a company dubbed ABC Construction. The focus on this company has shown hoe change can be managed under progressively. As it has been discussed, the company has employed a number of measures to manage change within the confines of TQM. It has also been discussed that ABC construction has employed has employed just-in-time strategies to minimise wastages of materials that occur due to periods of storage, bad weather and other delays. The paper has also discussed the measures that can be taken by construction industries to manage change due to new government regulations and also to increase their competitiveness. In particular has discussed the measures that construction companies currently take to increase their adherence to sustainable building technologies through training and investing in technologies that minimise resource wastage and promote re-use, recycling and recovery of materials in various processes. References Hussey, D.E. 2000, How to Manage Organisational Change, Kogan Page Publishers, London. 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Tiit Elenurm, 2007, "International competitiveness and organizational change drivers anticipated by Estonian managers in the context of European integration", Baltic Journal of Management, Vol. 2, No. 3, pp. 305 – 318. Sustainable Build, 2010, “Reducing and Managing Waste” Available from http://www.sustainablebuild.co.uk/ReducingManagingWaste.html (10th January 2011). McGuire D. & Hutchings K. 2006, “A Machiavellian analysis of organisational change,” Journal of Organisational Change Management, Vol. 19, No. 2, pp. 192-209. EPSRC, 2004, “Managing Changes in Construction Projects,” http://www.bne.uwe.ac.uk/cprc/publications/mcd.pdf (10th January 2011). DEFRA, 2008, “Non-statutory guidance for site waste management plans,” available from http://www.defra.gov.uk/environment/waste/topics/construction/index.htm (10th January 2011). Hutchin, T. 2001, Unconstrained organisations: managing sustainable change: unlocking the potential of people within organisations, Thomas Telford, London. 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