Global innovation: generic responses to the need for innovation in the construction industry

Citation

Tookey, J.E. (2011), "Global innovation: generic responses to the need for innovation in the construction industry", Construction Innovation, Vol. 11 No. 4. https://doi.org/10.1108/ci.2011.33311daa.001

Global innovation: generic responses to the need for innovation in the construction industry

Article Type: Guest editorial From: Construction Innovation, Volume 11, Issue 4

The global construction industry has raised many exigent issues that have adversely affected productivity, growth, profitability and quality. One of the principal reasons for this has been the poor level of innovation of new products and processes that could be used to develop higher productivity, product performance and quality (Egan, 1998; Fairclough, 2002; Hampson and Brandon, 2004; NZCIC, 2006). Given this incumbent call for innovation raises two distinct questions. First, what constitutes “innovation” around the world, and second, what have been the global responses to such a generically expressed requirement to innovate?

These two short questions generate by way of response a plethora of potential answers depending on the history, education and the interests of the respondent. Renewal or improvement is a central thematic driver of innovation. Consequently, the net effect of such renewal or improvement is a novelty of process, technology or technique which allows stakeholders to make new choices. At a strategic level, new choices often involve solving problems of society, through innovation to recognise a new set of values that govern economic choices. This neatly ties into the views of the theoretical cornerstone of innovation that “innovation changes the values onto which the system is based” (Schumpeter, 1934). Accordingly, when consumers and manufacturers change the value system of the current economy, (assuming that the products and processes developed by innovation are superior), the old system will naturally change to make room for the newer one. When these preconditions are achieved, then it can be considered that innovation has taken place.

At an operational level, innovation is predominately oriented towards the development and incorporation of new inventions or discoveries into the market place. These innovations in turn may be incremental in nature – evolutions of pre-existing technologies. Incremental innovations tend to be low risk since their basis is well known and understood from technical or procedural perspectives (McKeown, 2008). Alternatively, they may be emergent innovations in technology at an early stage of their use. Emergent innovations often have a higher risk profile than incremental innovations since their inherent risks and internal processes are less well understood. Emergent innovations therefore have to offer substantially larger potential benefits than pre-existing solutions in order to gain acceptance to warrant the increased risk of their adoption. Finally, innovations can be radical and/or revolutionary changes to the way that industry and society think (McKeown, 2008).

The measure of an innovation in an absolute sense is the ability that it has from its introduction to change the value system of the economy into which it is introduced. This presents a further level of complexity related to the question of what constitutes innovation around the world. It could be contended for example that there is a strong linkage between what constitutes an innovation and the starting point of the economy concerned. Consider the example of telephone usage in the developed world; after an initially slow uptake in the late 1800s, telephone usage in the developed world grew rapidly as it became a ubiquitous form of communication for society in general and business in particular during the twentieth century. Similarly, internet usage grew slowly at first but has since similarly become totally ubiquitous. Both technologies were transformative of society and thus clearly innovations in the absolute sense – or “killer applications” (Downes and Mui, 1998). However, for a number of years neither transformative technology had much impact in undeveloped countries worldwide, in particular, countries in sub-Saharan Africa. The key constraint for either technology was the level of infrastructure needed along with the maintenance of this. This prerequisite can invite substantial problems in terms of installation and maintenance costs (IOL, 2008). The turning point in such developing societies was a further transformative innovation – the mobile telephone. At a stroke, the advantages of telephone communication and internet applications could be delivered without large infrastructure investment; and such usage is now having a transformative effect on the various societies in these developing countries. In this case, innovations become innovations only when they were effectively used by the societies and economies concerned.

By way of comparison, the Egan Report (1998) in the UK generated substantial change in the way the construction industry as a whole thought and measured itself. It took a further eight years until an equivalent report (NZCIC, 2006) – with suspiciously similar headings, language and terminology throughout was produced for the New Zealand (NZ) construction industry. Long enough to see whether the innovations put forward were working before they were tried in New Zealand. The same is essentially true for innovations in the construction industry around the world. A strong linkage may be suspected between the normal “ambient” economic and technical development in a country and the likely innovations being sought. Consequently, the societal and economic contexts of innovation processes and products becomes of paramount importance. This is not hard to conceptualise, for the majority of construction around the world is very much parochial, market-orientated, with little international competition (except on very large projects). Thus, competitive advantage from having more innovation comes not just from achieving global leadership, but from managing local leadership as well. Thus, seeing how effectively other countries implement innovative change in their construction processes allows reflection to occur particularly what does and does not work. Arguably this could be a case of “second mover advantage”.

In terms of the second question posited, “what are the global responses to the requirement to innovate?”, this can be discussed in the context of the papers contained within this special issue of the Journal of Construction Innovation. The repeated theme raised by all the papers relates to the role of clients. Clients form a critical component in developing the context in which the construction industry operates. Kulatunga et al. examined the characteristics of clients that made them effective in the development of a culture of innovation on construction projects in the UK. The likelihood of the effectiveness of innovations being incorporated into the development of projects being strongly linked to the attitude and behaviours of the client, and by consequence the culture of innovation seen on the case study projects researched. Having clients proactively engaged in encouraging innovative solutions is therefore essential. It could also be advocated that the efficacy of client involvement also positively influence, outcomes.

Wandahl et al. introduces a conceptual model for understanding user-driven innovation in the materials supply industry based on a study conducted in Denmark. This model ties together in a mutually beneficial iterative process of development, both the developers of innovations in technology and capability with those originating the demand for those innovations – the user. This has the effect of increasing the likelihood of effective innovation by maximising connectivity between the market place for the product and the developer, (essentially, market-driven pragmatism shaping the direction of innovation). However, this could potentially create a somewhat paradoxical situation of innovation constrained by users being less aware of the possibilities than developers.

Murphy’s paper recognises risk as a critical dynamic impacting the rate and efficacy of innovations being adopted in construction. This used construction project stakeholders to mitigate risk based on a study in Ireland, using the proven technique of failure mode effect analysis to analyse the effect of abandonment of innovation due to the operation of uncontrolled constraints. The outcome of this study proposed a model for increasing the possibility of successful innovation introduction through an improved understanding of the risk profile, along with the consequences of innovations in the construction process.

Morledge introduces the role of further education colleges (FECs) in the uptake of innovative services and products for the construction sector. This examines the mechanisms available to affect the context of clients in the construction industry, as well as the industry itself. This paper notes that while society wants industry to innovate; industry wants to innovate, but does not seem to have budget for R&D; and FECs want to assist, but they are financially constrained in so doing.

Liu and Wilkinson examine the nature and problems relating to the context specific implementation of public-private partnerships (PPP) in New Zealand. Once again, this is a client-driven issue, since the governmental bodies undertaking the majority of major infrastructure spending are seeking to adopt innovative mechanisms of developing private finance to fund public spending (similar to the PPP approach pioneered in the UK and elsewhere). They contend that significant problems exist that need to be overcome in order to facilitate its effectiveness outside the larger economies (UK, Australia, etc.) that have hitherto been used. In particular, they highlight the issues of politics, the size of the economy and cultural factors specific to the New Zealand context.

Van Egmond and Mohammadi introduce a survey of the market use and interest in domotics across a range of European countries. Once again, this is a client-based issue to deal with. The research undertaken demonstrates an apparent impasse between technology innovators pushing new capabilities into the market place, and the inherent “conservativeness” of the construction sector across the European nations surveyed. The authors suggest the need for a “technological regime change” as a means of developing understanding and demand amongst users and specifiers (i.e. customer and client groups) for domotics in order to develop market place maturity.

In summary, the nature of the global responses for the need to innovate in the construction industry is gaining momentum. It seems apparent that the majority of work presented in this special issue embraces “expectations”. Given this, in an absolute sense the adoption of new technical and process innovations are likely to be dependent on the economy concerned, as the only shared similarity between economies around the world is that somebody somewhere has to provide the funds to commission new construction projects. That point of commonality is therefore the client. Consequently, it is possibly that the client’s (and by extension, the “user”) needs are paramount when it comes to construction innovation. In the absence of the global levelling of economic and technical competency, this is also likely to be an ongoing focus for research.

Ultimately, the nature of innovation seems to be “in the eye of the beholder”. A concept is innovative in the context of the society into which it is being introduced (if it is considered to be so), therefore, creating the drivers for innovation, developing the processes of innovation, and finally, implementing the innovative products and systems, (in any economy around the world), is inherently difficult in the conservative construction industry; as this often invites change, and change in turn incorporates the genesis of risk. Machiavelli (1513) probably said it best:

[There] is nothing more difficult to plan, more uncertain of success, or more dangerous to manage than the establishment of a new [order of things]; for he who introduces it makes enemies of all those who profited from the old order and but lukewarm supporters amongst those who may profit from the new.

John E. TookeyGuest Editor