With the nights drawing in and summer already feeling like a distant memory, I wanted to take a moment to reflect on the journey we’ve taken with the Value Toolkit since its inception back in July. Within this collaborative force of a project, I’ve had the privilege of leading Workstream 3, covering ‘Market Response’.
This workstream focuses on facilitating direct engagement with key groups across the supply chain to identify potential barriers to, and opportunities associated with, the adoption of value-based delivery models. Our work in this space will ensure the supply chain is ready to respond to, and capitalise on, new ways of working and more clearly articulated client value drivers.
So far, we have been met with great take-up and an enthusiastic response from the industry. Whilst our initial round of consultation is still in full swing, we have already gauged a consensus view from industry that there are clear benefits to adopting a value-based decision-making approach. Our conversations have also helped us to understand some of the perceived blockers to achieving this, which range from cultural factors, cost-based approaches, lack of market engagement and lack of genuine collaboration.
Unsurprisingly, almost everyone we have engaged with has experienced issues with a lack of alignment in decision-making, and faced problems presented by an imbalanced approach to controlling costs and transferring risks, versus the lack of emphasis placed on whole-life performance.
Arising from these frustratingly common experiences is an enthusiasm and genuine desire to grasp the opportunity that the Value Toolkit presents to drive consistency in decision-making and enable long-term and fruitful industry collaboration. This collective determination will ultimately open up significant opportunities for organisations across the sector to deliver projects which are more closely in line with the intended outcomes of clients and wider society.
To support this, we’ve been looking closely at the role that insurance can play in enabling value-driven decision making. Developing the capacity to better understand risk and manage it effectively and transparently will make for a more sensible and predictable market. The big question is, will organisations that understand the current market and its risk profile embrace a new way of working?
As part of our Market Response work, the Value Toolkit team have also been investigating the role that contracts play in enabling or blocking value-based decision-making. Interestingly, we’re observing that the contracts themselves are not the root of the issue, but actually how we are implementing them. The plethora of z clauses and additional terms mean standard contracts are not used in the way they were traditionally envisaged.
Over the next few months, we will continue our engagement work to grow our understanding of the Value Toolkit’s market enablers. So far, we’ve been overwhelmed by the willingness of the industry to get involved and have their voices heard, and we really hope this is a theme that continues as the project breaks ground. It certainly seems like there is a huge appetite for the #ValueToolkit.
Read the Market Enablers Interim Report which sets out the findings for the Market Response Workstream of the Value Toolkit. The findings are based on 12 structured online workshops, held in partnership with industry bodies and associations, involving 131 participants from 93 organisations.
Alison Nicholl is the Head of Constructing Excellence
Alison heads up Constructing Excellence, a platform from which to stimulate, debate and drive much needed change in the Construction sector. Alison is passionate about improving the construction industry and has 19 years’ experience delivering knowledge transfer, innovation and industry change in the built environment sector.