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Are we too late to keep ourselves out of recession?

As we head for a sustained period of economic turbulence, firms will have to get much more efficient to survive, says NCE editor Antony Oliver
The dreaded R word has finally surfaced this week. And while civil engineering and infrastructure is likely to be more insulated from recession than many of parts of construction, it is clear that we face perhaps the most turbulent economic period for two decades.
Perhaps then, there has never been a better time to revisit Sir John Egan’s Rethinking Construction philosophy. Surely now more than ever we need to be focused on “delivering the value that our customers need” and being prepared to “challenge the waste and poor quality” that still dogs large parts of the industry.
It is true that over the ten years - of good times - since Egan’s report, huge amounts of energy and (really good) work has gone into helping the construction industry to reduce cost, accidents and defects and boost programme and cost certainty. And there have been success stories.
We have seen many complex projects brought in on time and to budget, we have seen greater efficiency through collaboration, teamwork and modularisation and we have seen a dramatic change in approach to welfare on site.
Yet for all the good news stories, the reality is that Egan’s key concerns about construction still exist. So what went wrong? To borrow a phrase, did we fail to mend our roof while the sun was shining?
Take Egan’s four “severe” 1997 problems in the industry:
 “it has a low and unreliable rate of profitability”
 “it invests little in research and development”
 “there is a crisis in training. Too few people are being trained to replace the ageing skilled workforce”
 “too many clients still equate price with cost”
It all sounds rather familiar. In short, for large parts of the industry Egan failed. Or went unnoticed. We still see major firms battling through adversarial contracts and busting budgets and programme as often as ever. And for all the investment in safety, figures published last week showed that 72 people were still killed in construction last year.
So as belts are tightened, publicly funded work on the highways and railways continues to be deferred and clients start screwing down prices, has the opportunity for industry reform been missed? Are we destined for an adversarial, low margin future?
Let’s hope not. Egan was right that strong leadership and strong partnerships are crucial to good civil engineering projects. Projects that are still capable of driving the UK through a down turn.
But Egan aside, the fact remains that the strongest and best will always survive. Is that you?

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