Advancing the Competitiveness and Efficiency of the U.S. Construction Industry (2009) / Chapter Skim
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Appendix C: An International Perspective on Construction Competitiveness and Productivity--Carl Haas
Appendix C: An International Perspective on Construction Competitiveness and Productivity--Carl Haas
Pages 55-75
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From page 55... ...
Eng., Ph.D. Canada Research Chair and Professor in Civil and Environmental Engineering University of Waterloo, Ontario, Canada Abstract This paper synthesizes some of the information that exists around international construction industry productivity and competitiveness metrics as well as innovation strategies in order to help inform strategic planning for improving the U.S.
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Harrison follows with discussions of model price indexes and how construction productivity is estimated in Canada and concludes with a critique of possible sources of measurement error. Harrison (2007)
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Flanagan has for many years pioneered an approach to comparison of construction internationally involving "competitiveness" rather than more prosaic measures such as labor productivity, or cost and schedule growth (Flanagan et al., 2007)
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These definitions make up building indexes such as those described in a report on the Web site of the Bureau of Labor Statistics (BLS) 2 entitled Producer Price Index Introduced for the Nonresidential Building Construction Sector -- NAICS 236221, and which are defined in the Statistics Canada3 disaggregated building construction price indexes.
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program, but these have not yet been officially released and may not be released soon. Beyond work package definitions for adjustment indexes and productivity metrics, performance and practice metrics definitions also differ between national benchmarking and metrics programs.
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• Construction productivity metrics system (CPMS) • Introducing new output price indexes • Mostly industrial sector • Measured in materials per unit cost and in installation-cost per unit of a building assembly • Hours per unit of work • A typical BLS building assembly corresponds to • Hierarchical and detailed work structure second or third tier of CPMS, and while they do • Do not adjust with input cost indexes not appear identical on an initial review, this should be investigated more thoroughly.
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From page 61... ...
Project schedule growth Phase duration factor Project schedule factor Construction phase duration Total project duration Project health index Change cost factor Automation Recordable incident rate Integration Lost workday case incident rate CII best practices such as Project Definition Hours per unit output (labor productivity) Rating Index SISIND-NET Cost deviation Percentage of plan completed (Brazil)
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This has not been attempted in any deliberate manner yet. Role of Adjustment Indexes in Comparing Benchmarking and Metrics Programs One purpose of adjustment indexes is to adjust input and output numbers so that productivity calculations can be compared over time and between industry sectors and countries.
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From page 63... ...
He notes that construction labor productivity growth was positive for Canada in the same period (Table C.5) , but he also points out that within Canada, the construction labor productivity growth rates vary substantially from province to province, by as much as 2 percent per year, and compared to Canada's average construction labor productivity, rates vary by as much as plus 18 percent and minus 33 percent depending on the province.
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and Canadian Construction Productivity Growth Rates from Various Sources and Over Different Periods Source of Estimate Data Dimension Canada United States Harrison (2007) Construction labor productivity 1.09%a −1.44%b improvement rates (1961 to 2006)
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Belgium 62 1.63 Finland 39 0.71 France 41 1.68 Greece 19 0.68 Ireland 48 1.64 Italy 38 0.95 Norway 56 1.40 Spain 44 1.54 Sweden 76 0.79 United 20 1.92 Kingdom United 100 −0.84 States Canada 120a 0.40 South Korea 2.56 Austria 2.43 Portugal 1.78 Australia 1.33 Denmark 1.24 Netherlands 1.21 Japan −0.06 Germany −0.06 a From Rao et al.
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From page 66... ...
In most of the nations reviewed in this paper, numerous impediments to innovation adoption are typically claimed, including the following: • Human and institutional resistance to change; • The perception of unacceptable additional project risk associated with innovations; • Fragmentation of the industry nationally, resulting in lack of a financial mass required to pursue innovation, maintain intellectual property ownership, and manage knowledge effectively; • Unique products that defy the easy adoption of mass manufacturing principles and innovations; • A unique combination of delivery method, design standards, and legal structure for every project; and • A focus on the short project construction phase for an economic planning horizon rather than on overall life-cycle costs. Potential solutions to these problems have been proposed, including the following: • Sustaining the effort and staying focused; • New business models for sharing risk, such as vendors who market innovation as a service; • Shared learning frameworks within trusted networks; • Better design of innovations; and • Pursuing explicit innovation deployment procedures and programs.
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South Korea has a vibrant university-based national construction technology research program. Many of the professors leading this research acquired their graduate degrees from U.S.
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, • Transport infrastructure, • Health and safety, • Knowledge management, • Implementation of research activities, and • A carbon disclosure project. The European Construction Sector has developed a European Construction Technology Platform (ECTP)
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The United Kingdom Construction innovation in the United Kingdom is impacted by some unique drivers. The United Kingdom has experienced a massive influx of Eastern European construction workers and a substantial commercial and residential building boom (only now grinding to a halt)
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Professor Alistair Gibb has pointed out the ascendance of prefabrication in the United Kingdom, closely paralleling the North American experience, due to its significant labor productivity advantage over on-site fabrication.11 Nonetheless, he notes that labor in the United Kingdom is not dominated by trade unions and that there has been a significant increase in multi-skilling in the United Kingdom in the past two decades. Perhaps some of the most significant shapers of the UK industry in the past two decades were initiatives led by Professor McCaffer at the University of Loughborough, including the establishment of the European Construction Institute (ECI)
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From page 71... ...
Canada has also had several industry-led construction research groups, including, for example: • Canadian Construction Institute, • Canadian Construction Innovation Council, • The Construction Owners Association of Alberta, and • The Construction Sector Council. In addition, Canada has a national policy of matching industry funding for research with government funding, in order to leverage such efforts.
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7. The United Kingdom has a less organized workforce and more innovative project management structures than those of the United States, and it is focused on competitiveness more than on labor productivity.
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2008. "Producer Price Index Introduced for the Nonresidential Building Construction Sector-NAICS 236221." Producer Price Indexes.
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2005. Strategic Research Agenda for the European Construction Sector: Achieving a Sustainable and Competitive Construction Sector by 2030.
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U.S. construction labor productivity trends, 1970-1998.
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