A number of comments made during an industry dinner last week have crystallised a new understanding for me about the real root causes of the building performance gap that we now hear so much about.
The performance gap is the difference between the notional energy performance of a building predicted by its designers and the actual out-turn energy consumption once occupied. When you eliminate the obvious impact of regulated versus unregulated energy then there is often still a disparity between design and operation. In many cases this is due to failings in the design or construction, but equally often there is a failure in the management and operation of the finished product.
As is usual in the construction industry, blame for the performance gap is being attached to individual parties in the supply chain. However I now realise that the real problem is structural and embedded in the nature of supply chains themselves. Design and continuous improvement is a circular process, but the supply chain is linear. It is like that because procurement and project managers have made it so. Nowhere within the supply chain is any one party responsible end to end for the building performance.
The project manager who implements last minute omissions from the ‘expensive’ metering and control system is rewarded by the client for bringing the project in on budget. Facility Managers who reduce operating cost by disabling systems or purchasing the cheapest replacement parts are awarded bonuses for achieving financial targets. The chances are that neither party will even be working on the project when the consequences of such decisions come home to roost.
Further, at each link in the chain, we create incentives that promote short term thinking rather than action for the long term outcome of better building performance. Most client organisations separate those responsible for capital investment from those responsible for operations. They reward the procurement teams for achieving the lowest capital cost. Thus procurement is through competitive tendering which provides a clear incentive to do as little work as possible whilst achieving an acceptable, rather than exceptional, outcome.
The consultants need to win work at the lowest cost which constrains the time spent on design. The contractors need to make profit to pay shareholders so will select products on the basis of cost not performance. The Building Control Officers need to win future work and are unlikely to tell unwelcome truths about the building performance. The facility managers survive on their meagre fees by not spending money on extensive maintenance and quality replacement parts.
Even within organisations the way people are employed impacts on outcomes. Employees’ performance in regard to promotion and reward is often measured against annual or even monthly financial targets. When you combine this with a project based workload you create a clear incentive to move on to the next project as quickly as possible, rather than spend more time on delivering one project really well. People are then often ‘too busy’ getting work and doing work to plan the future of their business and still less the future of construction.
It is telling that the RIBA survey of chartered practices found that 62% do not have a business plan. I’d be prepared to bet that the most common reason for not having a business plan is being too busy to create one. Having worked in and run small businesses myself I am well aware of the pressure simply to keep turning over the work.
The building performance gap is not the ‘fault’ of the construction industry or the occupiers. It is a product of the systemic failure of procurement, management and operation of buildings.
More thoughts about the impact of procurement on construction value in follow up article ‘Race to the Bottom‘