To Manage Construction Project Risk, You Need a Less Risky Way of Building
Given recent events, nobody in the construction industry should need reminding about the importance of risk management. And yet, much of the industry continues to survive on tiny margins and use methods that have been shown, time and again, to bring significant risks. These risks come in the form of when projects will be completed, how much they will cost, and the quality and performance of the end product.
In a sector that operates on such low margins, is this level of risk sustainable? At what point does the inherent financial risk in construction prevent projects from even starting?
In other industries, investment in technology has allowed things to be done faster, cheaper and more reliably. Only small parts of this revolution have touched the mainstream construction industry.
Offsite Reduces Construction Project Risk
Construction doesn’t have to be significantly more risky than other process. Modern methods such as Innovaré’s i-SIP System are proven to offer greater reliability over costs and timing. There’s an irony that the industry seems to be clinging to familiar methods – presumably because sticking with what you know feels like less of a risk – when there’s a proven way to reduce risk by building differently.
There are encouraging signs that the industry is no longer prepared to dance around the issues of productivity and quality. There has been a significant upsurge in interest in offsite construction over the last few years. The presumption in favour of offsite for publicly funded projects is certainly helping.
But extensive application of offsite in projects is still not mainstream. Which means that the bolder earlier adopters are enjoying a competitive advantage.
Having the design locked-down and buildable from an early stage, coupled with factory-controlled production gives certainty over completion, the scheduling of labour and materials, and cash flow. There’s also less exposure to the risk of rework and quality issues following handover.
In an industry that is crying out for lower financial risk it seems natural that offsite methods will increasingly become the way that construction projects are delivered.