Building Information Modelling has been a regular on the agenda at industry conferences and talking-shops for at least the past fifteen years. It needs little introduction, and less propaganda: everyone knows that it offers the potential for slicing away unnecessary costs in the design, construction and operational phase of most projects.
But in 2011, BIM has quietly left the conference hall, and established a presence in several corners of our vast industry. BIM is being adopted by public and private sector clients (try Manchester City Council or Asda); by the leading edge of contractors and project managers (think Laing O’Rourke, Skanska and Mace); and, in descending order of enthusiasm, by structural, civil and services engineers, and architectural design teams.
The scope and complexity of what’s being achieved varies, and no one has run a project on an integrated project-wide BIM model from Day One to handover (or beyond). But what’s important is that BIM has definitely moved from being a talking point to an action point.
But how does the middle ground of the industry get to grips with an issue with no fixed form or defintion, no agreed protocols or technical standards, and the perceived risk of buying BIM Betamax?
The message from the experts seems to be that the industry has to ‘get over’ BIM. It’s not going to change your life, so stop expecting it to. It’s not going to put a hole in the balance sheet, so stop worrying about it. The software can only be ‘wrong’ if it doesn’t achieve efficiencies or encourage new ways of working, the same rationale that always applies to new software, and any step towards BIM is going to be a step in the right direction.
BIM, in other words, is just another business decision, and to be viewed as such. And like many other business decisions, the risks don’t lie in taking the ‘wrong’ approach, as in not reacting at all.
More power to the industry’s SMes?That seems to sum up government thinking on public procurement, evidenced by recent comments from Cabinet Office minister Francis Maude. It’s hard not to agree: SMEs have undoubtedly had a tough time in the era of high-value, long-term framework deals. But those same deals have also delivered savings, training opportunities, and real collaboration.
Elaine Knutt, editor
Feedback
CITB levy is fair to companies big and small
Mark Farrar, chief executive, CITB-ConstructionSkills
I read with interest the letter in the January edition of CM from Kathy Bachler of BAC Construction, in which she raises questions about how we invest employer funds back into industry. I would like to clear up any misconceptions about CITB-ConstructionSkills.
Bachler raised a common question that we are often asked: how much of employer funds do we use towards our operation costs? Employer funds are not spent on supporting the general overheads of CITB-ConstructionSkills. Surpluses derived from the sale of products and services and a contribution from contracted income cover the majority of the running costs.
What about micro employers? As Bachler rightly asks. Small and micro firms contributed 42% of levy income in 2009 and benefited from 47% of the grants, college fees and other training allowances.
We are an employer-led organisation with a board and a number of committees and advisory panels with strong representation from federations and employers from all sectors of the industry. Without commenting on Bachler’s particular case, we believe in the value of a fair system, and reward so in the form of grants and apprenticeships support.
We actively encourage the industry to come forward and make their views known on how we’re performing, supported by our trained customer-facing staff who are ready and willing to listen.
If you want to find out more about CITB-ConstructionSkills and our grant system please visit our website at: www.cskills.org.
Getting the numbers right
David Roberts MCIOB, MACostE, MRICS, MCIPS
I was surprised to see CM publish a misleading quote from Suzannah Nichol of the NSCC: “Our members are financing the industry through retention funds. If their profit margin is 2% and if the retention withheld from them is 5%… well you do the maths” (CM February, News) without a “health warning”.
In fact, profit for a sub-contractor should be calculated as a percentage of the company’s working capital invested at any one time. In a contract with stage payments, the actual profit in the bank could amount to a much higher percentage than the 2% headline figure.
As the rates/milestone are invariably front-end loaded, and if the contract is of a reasonable duration, it does not take long to be in a position where the client is financing the project and the contractor’s profit has soared. If this were not so then no one would bother being a specialist contractor.
In addition, no contractor has to accept a 5% deduction from its invoices as any respectable client will accept an on-demand bank guarantee or in some cases a bond in lieu of the retention deduction.
If the contractor has a reasonable financial profile the set up costs are usually a few hundred pounds. For really large contracts these guarantees and bonds can start low and track the invoices submitted to further minimise cost.
If the NSCC campaigned for all construction contracts to have retention guarantees or bonds it would have far more support from all sides and life would be fairer and simpler for all. The only people who would lose out would be those with insufficient financial backing to be in the game in the first place. Such a change would benefit the majority of contractors/subcontractors.
The system I suggest here is tried and tested in the petro-chem, oil and gas, power and marine sectors with contract values ranging from tens of thousands to billions.
I would suggest the problem stems in part from the unquestioning use of existing standard forms of contract that include percentage-based retentions.
