The Egan Report 23 years on… Part 1: How has the construction industry changed?

More than two decades on from the release of the influential Egan Report, Nathan Doughty, CEO of Asite, reflects on the progress the construction industry has made with five key drivers of change

In 1998, an industry task force chaired by Sir John Egan, the founding chairman of Asite, published Rethinking Construction, also known as the Egan Report. Broadly speaking, it considered how the automation and efficiency measures used in other industries, such as automotive and aerospace, could be applied to the more fragmented UK construction sector.  

It also attempted to look at the construction industry from a clients’ perspective and identified opportunities for improving the quality of its products and services, based on five key drivers of change: committed leadership; focus on the customer; integrated processes and teams; a quality-driven agenda; and commitment to people. So 23 years on from its release, what progress has the construction industry made?  

Well, let’s start with committed leadership. The Egan Report defined it as “management believing in and being totally committed to driving forward an agenda for improvement and communicating the required cultural and operational changes throughout the whole of the organisation”. And, generally speaking, there has been considerable progress here.

The impetus for the systemic change advocated by the Egan Report needed to come from the top of the supply chain and, for a large segment of the UK construction industry, that’s the Government. Over the past 23 years, they’ve driven improvements in everything from procurement and supply chain economics right through to technology adoption.

Naturally, this has happened in fits and starts; we all know that government departments don’t move in the same direction in a unified way. But if you look at the longer arc of the past two decades, it’s clear many of the recommendations of the report have been implemented.  

In 2016, for example, the UK Government mandated that all government-funded construction projects must be delivered with “fully collaborative 3D BIM”, which has increased the adoption of Building Information Modelling (BIM) throughout the industry. It has also set out clear targets and agenda points for improving how different stakeholders work together to deliver the built environment, and the result has been real, positive change.

Customer focused

As the Egan Report stated: “In the best companies, the customer drives everything.” However, the task force found the construction industry tended to focus more on the next employer in the contractual chain rather than the end-user, an issue digital transformation has helped to address.  

Thanks to BIM and other digital technologies, every participant in a construction project now has a clear idea of what will ultimately be delivered to the end-customer. And with the advent of digital twins, there are now outputs beyond the physical asset that can improve its function and long-term maintenance.

That said, if you’re a labourer on a construction site, your customer is still a subcontracting firm; they’re the ones you’re working for rather than the government department funding the project. This is the root of the industry fragmentation the report mentioned and why it called for integrated processes and teams. But it’s worth remembering that fragmentation is both a weakness and a strength, allowing for flexibility at the expense of getting a common message across to all the different moving parts. 

With cloud collaboration platforms and standard messaging interfaces, you can retain that flexibility while addressing the communication gap. It’s something we’re dedicated to delivering at Asite, which was founded to develop a digital platform that would support the changes recommended in the Egan Report.  

I strongly believe the platform we offer can help the industry to deliver better results for end-customers. In fact, digital collaboration technologies and open data, which are increasingly commonplace in every industry, are integral to the fifth key driver of change from in the Egan Report: a quality-driven agenda.

“Quality means not only zero defects but right first time, delivery on time and to budget, innovating for the benefit of the client and stripping out waste, whether it be in design, materials or construction on site,” the report said. And thanks to the digital tools I’ve mentioned, we’re now much better at eliminating waste and defects, and delivering the “real quality” requested by the task force than we were at the turn of the century.  

The crucial difference between “value” and “low cost” is also much better understood now thanks to long-term partnering arrangements and large integrated construction firms that support value-based procurement. There’s still a lot of work to be done, of course, and that’s something the Government can assist with by improving transparency during the procurement process to dispel the notion that it’s “all about cost”.

Educated and engaged

One big positive of the past 20 years is clients are now more educated and engaged in the outcome of a project. Thanks to greater access to data and information on projects from around the world, expectations of quality are rising, which is ultimately a good thing. However, there remains much to be done to address the final key driver of change: commitment to people.

According to the Egan Report, this means not only decent site conditions, fair wages and care for the health and safety of the workforce. “It means a commitment to training and development of committed and highly capable managers and supervisors.” But in my experience, the emphasis on training within the industry is still spotty two decades on.

There are highlights that have rightly been recognised: Laing O'Rourke, for example, is widely renowned and applauded for their Apprenticeship+ Programme, which brings hundreds of talented young people into the industry each year.  

But if we want to make construction a truly attractive career choice for smart young people, we need to make more effort to communicate the attraction of the industry and that it allows you to help create the world we live in. 

Finally, it’s worth reiterating that the ideals of the Egan Report can still help to guide the construction industry in the future. Much progress has been made since it was published, but we all need to recognise that change is an ongoing process and the industry will never reach a point of perfection. However, if you pause, take a look back, and consider the more open, collaborative and efficient ways of working we have today, it’s clear we’re moving in the right direction.