Laying Leadership Foundations for the Future
The UK’s built environment industry is undergoing a revolution. A number of large scale projects such as One Nine Elms, Meridian Water and UWE Bristol are driving demand and creating an attractive proposition for international investors. Yet, the unique nature of these larger developments paired with impending impacts of Brexit and the notorious red tape surrounding planning presents significant leadership challenges. The ability to break down barriers to international trade, drive R&D and innovation, navigate increasingly complex landscapes and comply with UK regulation is essential. To match the pace of this change, success lies in having the right people. In the midst of a widening skills gap at the top, it’s time to think outside the box for a solution that provides a mix of technical and commercial skills needed to deliver results, returns and resilience.
International firms need knowledge of the patch while the UK needs more innovators
The increasing demand for built environment delivery combined with the sector’s historically low margins are leading to increased interest from overseas contractors that are able to offer innovative and cost-effective solutions. Chinese heavyweight the China National Building Material Company, which is behind six prefabricated home factories in the UK, is fiercely taking on the UK market. However, to achieve optimum commercial returns and deliver on time and budget, overseas firms need on the ground individuals with knowledge and practical understanding of the UK’s indigenous supply chain networks, cultural differences and market challenges including gaining planning approvals. This proved successful for Beijing Construction Engineering Group International when managed by Gavin Taylor, an Operations Director with years of experience navigating UK infrastructure and securing high profile work including Airport City in Manchester. Hiring talent from UK contractors may help to forge stronger links with overseas industry, break down barriers created by market differences and generate the best outcome for end user and contractor alike. At the same time, UK contractors looking to compete with international firms and produce innovative methods of delivery must look to their leadership. Securing individuals with a track record for driving innovation and R&D will be increasingly important if companies are to remain competitive.
Catalyse R&D and innovation through leadership and collaboration
It’s no secret that UK contractors must continue to evolve in order to forge a competitive advantage, however an area that is lacking for the UK’s built environment industry is R&D and innovation. Construction accounts for less than 1% of the claims for R&D tax credits, compared to 30% in manufacturing, held back by a sector-wide lack of familiarity. More firms are realising the commercial opportunities on offer and the need to compete with international firms. As an example, UK financial services giant Legal & General recently began the hunt for development partners to support its move into modular homes, set to deliver 3,000 units per year. To think differently about its approach and fully embrace R&D and innovation, the sector must examine how it can source or collaborate with leaders and experts that have a track record for facilitating this transformation successfully in their respective fields. Exploring leadership in areas that embrace change such as manufacturing, automotive and logistics, where there has been a clear rise in the use of robotics and digital technology may help the built environment take that crucial leap forward.
The uncertainty generated by Brexit and it impacts on trade tariffs, access to labour and future funding and regulation is creating a number of challenges and opportunities for firms to seize the initiative. Importantly, organisations face leadership challenges around succession in the near future with a lack of quality in the mid-senior tier. Consequently, competition is high and native firms are designing creative methods to hold on to their own their high performers. However, organisations can look to plug the emerging skills gap in leadership and management by looking further afield and redesigning role profiles. For transferable commercial skills including bidding, project management, negotiation and strategy, talent can be found in professional services such as legal and finance where individuals are highly competent and will quickly pick up the vocational knowledge. Natural people and business leaders are rife across the business service sectors and the armed forces where there is an exciting population of high level operators. Finally, wider experience in implementing innovation and organising complex processes lie within the likes of manufacturing and logistics. Contractors pursuing a pragmatic and proactive approach should audit these sectors and benchmark them against existing networks in order to supplement and upgrade their leadership talent.
Large-scale projects are driving the evolution of the UK’s built environment industry and providing huge commercial opportunities for contractors. In the face of increased international competition, Brexit and the ever-challenging hurdles, focusing on finding the best balance of technical and commercial leadership will maximise business’ success, generate the best returns and write the next chapter in the sector’s story.
George Dobbins, Specialist in Built Environment at Berwick Partners.
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