Simon Murray
11 March 2015
Why do so many clever people have so few game changing ideas? Simon Murray thinks big companies and the rise of project managers might be part of the problem.
The UK construction industry has a problem with innovation. The government has reported that in 2011 contractors invested a mere £37M in innovation1. There is no shortage of bright people and new technologies in the industry, but neither is there evidence that we are delivering better projects or improving productivity.
"Delivering a single project on time, within budget and to quality has become more important than connecting up all the people working on a series of similar projects to see if they can produce better solutions."
The traditional practices that many clients still use to procure construction work are not conducive to innovation. But when clients have brought their consultants and contractors into alliances or framework agreements, there has been no sudden flourishing of game changing ideas. We should ask ourselves whether the root causes of this problem lie much deeper in the structure and culture of the industry.
US academics Wesley Cohen and Daniel Levinthal have argued2 that a firm’s innovative capabilities depend on its ability to recognise valuable new ideas outside the firm, absorb them and convert them into new products and processes. Defining this as a firm’s absorptive capacity, they highlight the importance of prior knowledge in diverse fields. As they put it: “A diverse background provides a more robust basis for learning because it increases the prospect that incoming information will relate to what is already known”.
In his book Where Good Ideas Come From3 Steven Johnson points to connectivity as a key enabler of innovation. He observes that innovations take many years to mature and result from the collisions between the hunches of people working in related but different fields. The more connected you are the more likely you are to nurture an innovation. Or as Johnson says: “Chance favours the connected mind”.
If the keys to innovation are diverse knowledge and connectivity, where is the construction industry going wrong? The answer might be found at the core of the industry’s culture and structure and in particular in our reliance on the established professions and on the doctrine of project management. Are these the problems we have to fix if we want to become more innovative?
Professions are essential for maintaining standards of practice and protecting us from charlatans. The evolution of the construction professions has produced many skilled and motivated people, but it has also developed specialists in narrow fields with limited business relationships beyond their fellow professionals and clients. They are open to new ideas within their own fields but often fail to spot new ideas outside their fields that connected together could lead to new ways of doing things.
The recent trend towards the consolidation of construction consultancies into large international firms is exacerbating the problem by creating the impression of diverse knowledge and relationships when the reality is the opposite. These large consultancies are beginning to look like jars of Smarties. At a distance they appear to contain all sorts of knowledge but when you get up close you find the contents are all the same shape and size and taste the same.
Project management has its origins in the US aerospace and defence projects of the 1950s and in the tools and techniques used to coordinate the engineering and manufacture of the thousands of components that went into an Atlas missile. Project management is still focused on the delivery of projects but is now all about breaking projects down into packages to procure low prices and control suppliers rather than about integrating components into completed projects.
The effect of this has been to constrain connectivity by creating a new team for every project and excluding most suppliers from the design and specification of the project. Delivering a single project on time, within budget and to quality has become more important than connecting up all the people working on a series of similar projects to see if they can produce better solutions.
The time has surely come to ask ourselves whether we want the construction industry to be innovative and competitive or are content with the status quo. I am not suggesting that the construction industry doesn’t need professional people or project management, but if we are serious about innovation and improving performance we have to find ways of organising our people and processes that maximises our connectivity and makes best use of our diverse knowledge.
Simon Murray is director of the Acumen 7 network.
References
1. UK Construction. An Economic Analysis of the Sector. Department for Business Innovation and Skills, July 2013.
2. Absorptive Capacity: A new Perspective on Learning and Innovation. Wesley Cohen and Daniel Levinthal. Administrative Science Quarterly, March 1990.
3. Where Good Ideas Come From. Steven Johnson, Allen Lane, 2010.
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