Apart from the architectural model on the white sideboard in his office, there’s very little to hint that Graham Cash started life as a designer. Neatly cut grey hair and moustache combined with dark pinstripe and a down-to-earth demeanour suggest a more traditional career path for the CEO of BAM Construct – a QS or accountant, perhaps.
But pretty quickly into our meeting at BAM’s base in Hemel Hempstead Cash proudly mentions his background. “I’m an architect by profession, which is unusual in this job,” he says, adding dryly: “And the other unusual thing is that I’ve still got this job!”
The recession certainly left a trail of devastation in its wake, taking the scalps of many contracting bosses. And while Cash is hardly linking his training with the fact he’s one of the few pre-Global Financial Crisis CEOs left standing, he does credit being an architect for always wanting to add value to projects and searching out like-minded clients who want to work collaboratively, and eschewing those only interested in the lowest price.
“We’ve not made a loss through the recession, though we have had issues and difficult contracts. However, we’ve been quite balanced in what we’ve done through the recession,” he says.
Graham Cash, BAM Construct
The 2015 results showed a profit of £13m on a turnover of £898m. Financials for 2016 were due as CM went to press. “Our margins were 1.5% and we’re targeting 2% this year, and we’re trying to increase that to 3%. These are not huge margins, yet we offer a lot of value in what we do. [The sector] sells its services cheaply,” he says.
“We didn’t follow the market to the bottom, and we’ve not been chasing turnover. The contractors who did that at the time are now the ones with the big, loss-making projects,” he says.
The latest big company where the scale of damage has been laid bare is Laing O’Rourke, which recently announced a £246m loss to March 2016. Was he surprised? “I’m surprised in one way because Ray O’Rourke is a canny guy, and he’s got a lot of good people working for him. He invested early in offsite, but he’s caught a cold in a number of areas, and one area is chasing that turnover. And when you’re desperate to win, you make decisions that you wouldn’t otherwise do.”
Cash says that so many clients who made all the right noises about collaboration and relationship building during the boom quickly reverted to type once the work began to dry up.
He reels off the good guys – Argent, Great Portland Estates, Allied London. BAM’s relationship with Argent goes back 30 years, spanning Birmingham’s Brindley Place, to King’s Cross. The important thing is being brought in early. “Argent is looking at its new Brent Cross development, and even though we’re not going to be involved for a number of years, we’re already assisting them on the profile of the commercial, retail and residential developments that they’ll do there.”
One project it won’t now be building at King’s Cross is the new Google HQ. It won the bid first time around until the AHMM design was judged too staid and Google brought in Thomas Heatherwick to look at it afresh. Lendlease is now strongly tipped as the front runner to build it. Cash says BAM didn’t bid again – “the risk profile of the job didn’t suit us”.
A design director in the days when BAM was Kyle Stewart – the original cheerleader for design & build – Cash’s natural instinct is for more integrated working, hence the firm’s spearheading of a digital revolution in a bid to raise margins. BAM got on board with BIM long before its peers and is now rolling virtual reality out across all of its projects. Cash is sold on harnessing BIM as a building management tool too, BAM has just used it this way for the first time on a £25m commercial project in Soho for Great Portland Estates.
But is he seeing a payback yet on digitisation? “You’ve got to think long term,” he says. “As far as I’m concerned, it makes so much sense to construct a building in your computer before you build it on site. And what you learn from that is easily transferred to your subcontractors.
“Previously, you could have that sort of modelling information in big computers. But now, through BIM 360 field, you can have it on your iPad. So the guys on site don’t have to go back into the office to see a drawing, it’s all in there. I went onsite the other day and spoke to one of the site engineers, and he said he was 70% more efficient since he got the iPad with the data in it.”
Cash says the benefit of equipping site managers with iPads is also huge in terms of motivating and retaining a younger generation. “They are much more digitally enabled, more free thinking, more prepared to move around companies. I mean I’ve been here 30 years, and I’m a new boy. I don’t think the new generation think like that. But if you treat them well and have the right culture, they stay.”
Moving forwards he says he’d like to employ digital construction systems to reduce administrative tasks and make life easier for those at the front line too. “In the old days, you’d have to fill in a form for safety, a form for fire, a form for this and a form for that. But now, if we can digitise our systems, you should only have to fill something in once at the pre-construction stage, and then it would be replicated throughout the project.
“And that’s a key task for us now. We’ve led the digital revolution, we now have to make sure our systems and procedures match that, and support the staff in doing things better, and in a new way.”
Cash on the Farmer Review...
“The Farmer report says the same sort of things as many before it. We do need to improve things, there’s no doubt about it. But the industry doesn’t seem to change. In the UK at the moment, it’s very competitive and aggressive, and there’s always someone willing to go that little bit further down in price. And that takes you down to high-risk, low margin, and not having the money to invest in R&D, which is what we should be doing.
“But the only way we can do it is to have a healthy business. And how do we have a healthy business? By doing it better and doing better things.
“And that’s the philosophy of what we’re doing, together with the fact that we’re not seeking turnover, we’re seeking a reasonable return.”
... On being part of a larger group
“I sit on the management board of Royal BAM in the Netherlands. It’s useful because I sit with Dutch, Germans, Irish, Belgians. We benefit from sharing knowledge. It’s about an attitude and an approach, rather than specific technologies.
“Being part of a larger group doesn’t restrict us. I think it adds rigour to your consideration of what is sensible and correct to do. But that dovetails with our strategy anyway.
“It helps that we have digital systems. From my iPad, I can look at any tender in the whole of Europe, and learn from that procurement.”
... On getting into housing
“We’re the biggest residential builder in the Netherlands. But in the UK, we only do residential where it’s part of a mixed development. That said, we are very conscious of the private rented sector being a growth market in the future. And we’re looking at how we can add value into that arena before we enter it. If we were to enter the PRS market, then we’d want to do it in a new way. But we’re also conscious that there’s a lot of risk around it.”
... On Brexit
“The market is slightly fragile. But actually, I feel quite confident about Brexit. I think it’s more of an opportunity than a threat. The group has not been impacted yet, apart from the fall in the value of sterling.”
... What about down time?
“Home is Harpenden. But I’m a country man. I’m happy in my Barbour and wellies, walking and fishing on the Derbyshire Wye. Everyone has their retreat, and when I cast that first fly, nothing else exists. I do enjoy watching a good football game and was proud to have built a new training ground for my team, Manchester City.”
Mancunian Cash, who bears a familial resemblance to younger brother actor and writer Craig Cash, of The Royle Family fame, got into contracting by chance. After graduating with a first in architecture from Newcastle University in 1980 he completed his professional qualification as an architect in 1981 before working with firms such as Arup Associates on leisure and international projects. It was while working at the St Albans-based John S Bonnington that his path crossed with BAM.
“I accompanied a colleague of mine from Venezuela to an open day, because he wanted to work for a contractor. I was sitting in reception and this guy next to me asked me what I did. I told him I was an architect and that I’d just come back from working on the Diplomatic Quarter in Riyadh.
“‘Oh that’s interesting,’ he said, ‘we’ve got the Japanese embassy to design’. So, that’s where it started, I joined the then Kyle Stewart in 1986 to look after the design of the Japanese embassy in Piccadilly with Kajima.”
Cash took a leading role on a number of prestigious Crown Court projects for the then Lord Chancellor’s Department — an unbuilt one is that model in his office.
He was appointed BAM’s design director in 1991, became director of BAM’s operations in the south-east region in 1997 before joining the board of BAM Construct UK in 2007. He landed the top role of chief executive on 1 April 2010.