Australasia's home for timber news and information

Australia doing poorly in offsite construction

Offsite construction in Australia, despite the hype, is wallowing in disillusionment, with some prominent failures undermining confidence in the sector, according to one of Australia’s leading construction experts. Source: Philip Hopkins for Timberbiz

“Despite all the hype, 20 years into the century, why have we seen no material changes on the job site?” said David Chandler, Principal and Adjunct Professor, Centre for Smart Modern Construction at Western Sydney University. “The last 20 years have been a peak of inflated expectations. Now we are in a trough of disillusionment, that’s where we are, we should be honest about that.”

He was giving the opening address at the Frame Australia Timber Offsite Construction conference at Crown Casino in Melbourne yesterday, speaking on how the industry would look in 2030.

“We must …. allow the best performers of the future to really stand out, to go ahead at an incredible rate. To do that, we must raise the platform from where they start, because if everybody starts on the same low platform, our innovation and competitiveness will be questionable.”

Professor Chandler said the ball was in the ‘collective court’ of the industry.

“It does not require a consensus of all existing players to come along; it will be about first movers, a movement of first movers – not just one, this is no ‘winner-take-all’ game,” he said. “We should move the focus of OSCM to transactions and capability-building.”

Much research was coming out of the universities.

“I can’t see what it’s doing. There are start-ups here and there who don’t get it right, yet we are surrounded by chasm of capability,” he said.

An experienced builder, Professor Chandler said he had been appalled by the standard of some of the projects he had inspected.

“We should hang our heads in shame,” he said.

Architects often still did not know how to design for offsite manufacturing, and the workforce did not know what to do when the material arrived from off-site.

Despite a number of success stories, some very high-profile failings such as Strongbuild and other companies undermined the confidence of the board and investment team in those companies – ‘We tried that and it didn’t work. We must stop having projects that are accidents waiting to happen’, became the mantra.

Even on one great project he cited, Professor Chandler said there was a huge gap between offsite and onsite.

“We are not getting the transition to the site. There is a huge discrepancy between getting manufactured equipment to the site and the final completion,” he said.

Globally, the offsite construction mix varied, starting with 20% offsite and 80% construction onsite, with the mix eventually becoming more onsite assembly and less traditional construction.

“We have identified that gap between offsite and onsite – that’s what we must do something about,” he said.

There were still too many gatekeepers who wanted to continue their traditional work in the supply chain before explaining offsite manufacturing and construction to the client.

“That will not work in the future,” he said.

Industry had the ability to lead and should be targeting a greater percentage of the market in projects of two-to-five storeys.

“The key to the game is speed. On all the projects I’ve observed, the critical factor of failure is the speed of assembly on site. If we measured nothing else – ‘How we improve the speed of assembly on site’ – focus on that, measure on that, benchmark that, and we will start to make in-roads into the conversation,” he said.

Professor Chandler said unless change occurred, by 2030 industry would suffer the same quagmire as now.

“We will be exporting more jobs offshore, we are bringing more value-added stuff onshore. ‘Scratch our heads like now’, we will export 200-300,000 Australian construction jobs offshore. We will live at the end of a sea container,” he said.

Professor Chandler said a reconstruction of the supply chain would take place, with the Australian manufacturing platform potentially becoming aggregation-driven and less capital intensive.

“It will be a game of aggregation …we are starting to see that happen. Amazon and other players are moving into this sector, they understand how to aggregate the supply chain. The aggregators will become the Amazons of the future, and the builders of tomorrow will become the deliverers,” he said.

Professor Chandler said in Australian offsite manufacturing, designs and model contracts could be done collaboratively. Numerous fights in the courts over copyright over project home designs had occurred in the past 20 years.

“Let’s have competition, get 50 designs suitable for OSCM and give them to the industry – free. Then you start having home designs being used suitable for OSCM,” he said.

“We must come up with a standard form of procurement arrangement for each contract, so project managers, architects and clients can understand what they are doing. Get rid of the gaps, speed is everything.”

Standard contracts and designs would lead to better and longer warranties, he said.

Professor Chandler said none of the universities and TAFEs could describe what construction work would look like in five years.

“Not one of them have a narrative to say, ‘Construction jobs will look like this’ and ‘These are the skills we need’. We still have the silos of engineering and architecture,” he said, and ‘Construction’ that no one understood.

“In the future, if you want to play in this game, you must understand design management. From the drawing board into production, you will understand procurement, logistics, compliance and QA, a new approach to on-site governance, a new approach to risk management, and accepting elemental pieces of projects.”

The 30-40 trades on a building would shrink down to about 10.

On the job site, Professor Chandler said there would be more regular OSCM design quality and standards, and more effective translation of delivery into manufacturing for assembly, as opposed delivery for ‘scratching your head’.

“There will be much better compliance chains of custody, on-site assembly with multi-skills and self-supervising teams. I have a great hope that many of the small-house building companies will turn in to expert at putting up superstructure, doing the substructure and fit-out. They will not try and do everything, but will deliver aggregated OSCM pieces onto the jobsite,” he said.