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Siloed construction industry reform will fail: We need systems thinking

OPINION: Australia needs a different way of thinking about construction industry reform and systems thinking could hold the key.

What is interesting about Dame Judith Hackitt’s final report that was commissioned by the UK government following the Grenfell Tower disaster is that it didn’t pin the blame on the cladding, but identified a wider systemic problem in the way the UK construction industry operates.

Dame Judith Hackitt, a chemical engineer by profession, described an industry and regulatory system that’s now unfit for purpose, which does not learn from its mistakes or from other sectors.

According to Hackitt, the key issues underpinning systemic failure in the UK construction industry include widespread ignorance and misunderstanding of regulations, indifference to quality and safety in preference for cheapness and speed, a risk transfer culture that obscures clarity about roles and responsibilities, and a high level of fragmentation and inadequate regulatory oversight and enforcement.

What is the relevance of this report for Australia and the current building defects crisis?

Hackitt points to the same problems in Australia, drawing on a report published by the Building Products Innovation Council in Australia in 2018.

This report prophetically concluded that “Australia’s building and construction industry is facing a problem of national significance that has adverse implications for the industry’s competitiveness, and potentially, for the health and safety of the community”.

The Australian construction industry was characterised as having a buck-passing culture driven by a low-cost mentality, where speed and volume take priority over clear oversight, accountability and visibility for quality and defects.

The industry is also described as highly fragmented, needlessly complex and underpinned by a regulatory framework that’s increasingly incapable of dealing with modern industry issues and rapid changes in the design and procurement of buildings and building products.

Both reviews broadly call for the same reforms: clearer responsibilities for the client, designer, contractor and owner for the delivery and maintenance of fit-for-purpose, reliable and safe buildings, simplified outcomes-based rather than prescriptive regulatory frameworks, a more rigorous risk-based approach to oversight and enforcement with real powers to drive improved behaviours and greater transparency of information, traceability and quality assurance through the life cycle of a building project. They also both acknowledge that this will come with a cost of the need for legislative change.

However, most fundamentally, both reports advocate a systems thinking approach to construction industry reform. Industry and government will need to think differently about their own organisations as part of a wider integrated system that cuts across all stages of a building’s life cycle – through planning, design, construction and operations.

So what is systems thinking?

In helping the construction sector understand what is meant by a systems approach to industry reform, it is useful to refer to the work of the late Donella Meadows.

Meadows was a scientist whose formative book The Limits to Growth is credited with highlighting the planet’s limited capacity to support life in the face of continual growth in population and consumption. This work critically informed the Brundtland Report, which laid down the foundations of the Sustainable Development movement, noting the interdependence of nations in the search for a sustainable development path.

In her posthumous book Thinking in Systems, edited by Diana Wright, systems thinking is described as a critical tool for thinking about an increasingly complex and rapidly changing world.

According to Meadows, a system is “a set of things — people, cells, molecules, or whatever — interconnected in such a way that they produce their own pattern of behaviour over time”.

A system is seen as being surrounded, buffeted, constricted, triggered and driven by outside forces that are largely beyond its control. Critically to systems thinking, the way that a system responds to these forces is seen as a function of the system itself rather than of the nature of the outside forces.

In other words, one change in an external environment may result in different consequences for different systems within it. Furthermore, the failure of any one system cannot be blamed on outside events but on the characteristics of the system itself.

Applying systems thinking to the construction industry

Taking the construction industry as one system that exists alongside other systems (industries) in a wider economic, cultural, social, environmental and political environment, a systems perspective tells us that the problems faced in construction must reside in the characteristics of the industry itself rather than in the external environment that surrounds it.

Indeed, systems thinking tells us that it’s only through understanding the industry’s problems as part of a larger set of influences that one can begin to address them.

Of course, there is something deeply disconcerting for us in the construction industry to start thinking in this way. Not only is it natural human behaviour to blame external forces for our problems, but the construction industry’s risk transfer culture exacerbates this type of thinking.

Furthermore, as an industry largely driven by an engineering mindset, its reductionist thinking causes it to solve problems by splitting them into smaller parts and by controlling the world around it rather than seeing the system as a whole.

As Meadows, states “psychologically and politically we would much rather assume that the cause of a problem is ‘out there’, rather than ‘in here’. It’s almost irresistible to blame something or someone else, to shift responsibility away from ourselves, and to look for the control knob, the product, the pill, the technical fix that will make a problem go away.”

The history of construction industry reform in Australia and overseas shows that it has been widely afflicted by this type of reductionist thinking. While there have been some laudable attempts to promote integrated procurement and bring stakeholders together to drive reform, these have largely failed.

The preference, especially in recent years, has been to fall back into our professional silos and political corners. Consequently,

Professor Martin Loosemore

Professor Martin Loosemore

industry reform in Australia has been too long characterised by conflict and division, and construction has failed to effectively respond to the technological and social changes that have been so readily embraced as an opportunity to drive productivity, corporate citizenship and positive public image in many other industries.

So not surprisingly, the problems we see today, rooted in the internal structure of the industry’s complex and outdated systems, have refused to go away and now seem to have reached a crisis point where the community has suddenly lost faith in our ability

to deliver safe, reliable and secure buildings that are free from liability and defects.

The sooner we recognise that the problems the industry face are problems of systems (undesirable behaviours characteristic of the system structures that produce them), the sooner we will stop casting blame and find the courage and wisdom to restructure it.

At a time when the world is getting messier, more crowded, more interconnected, more interdependent, and changing more rapidly than ever before, we need another way of thinking about how the Australian construction industry can embrace the many opportunities which surround it.

Martin Loosemore is professor of construction management in the faculty of the Built Environment at the University of NSW, Sydney. He is a visiting professor at the University of Loughborough, UK, a Fellow of the Royal Institution of Chartered Surveyors, and a Fellow of the Chartered Institute of Building.


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