Keeping the United States competitive in the world-wide $7.2 trillion construction industry market is not only a tax issue but a far more holistic economic and cultural issue. There are currently well over 250 associations and agencies related to the construction industry in the US. Many have dynamic plans to make productivity improvements. However, most of them, if not all of them, all are focused on a single sector of the facilities and infrastructure industry, such as architecture, civil engineering, mechanical, electrical, construction, etc. Few are looking at the collective industry wide impact of their productivity improvements.
While in general this is a positive strategy, it does not tend to move the industry as an entity forward on a national basis. In May 2011, the UK published four national goals toward which all their efforts can now focus. The following six goals are proposed as ten-year – 2028 national goals for the USA:
- Reduce project Total Cost of Ownership (TCO) by 40% – A truly sustainable position is to look at an asset over its entire life. Looking only at an individual products’ life cycle cost is not a broad enough view. The impacts of any cost decision must be looked upon as its effect upon ones’ entire portfolio of existing and new assets to ensure one is truly making a sustainable decision. In some cases, assets may need to be retired to achieve a TCO reduction. The UK is looking at reducing first cost by 50% by 2025. I believe, an acceptable goal of 40% of TCO measured in current dollars seems an appropriate goal most positively affecting asset owners.
- Reduce project delivery time by 50% – Time in fact is money. The sooner you can begin using an asset the better for the owner financially. All agree there is currently significant waste in the construction process that could be mitigated by implementing a more parallel approach to construction business processes. We also see significant improvement in time schedules when incentives are provided, which proves change will reduce time and save money. The best way to measure this metric will be to identify the delta of delivering early based on the per day value of an operating asset in dollars. One of the UK goals is also looking to reduce delivery time by 50% by 2025.
- Reduce land fill waste and increase recycling by 30% – Construction generates over 40% of the landfill in the United States, currently much of that site waste is comingled material which is difficult or costly to recycle. Approaches such as off-site construction have proven to create less waste and can be applied more creatively. This is not only a dollars and cents issue, but can be measured in yards of waste reduced which does translate into dollars, although the value is far higher to the environment. This is not a goal of the UK, however is felt to be a significant opportunity for the United States.
- Reduce carbon footprint by 50% – There is no disagreement that there is more free carbon in our atmosphere today, the impact of which quickly becomes political. The goal of this metric will be to reduce the amount of carbon released based on the impact of the built environment which is estimated to be 40%. Reduction of the carbon footprint can also yield productivity improvements. We need to develop a nationally acceptable way of measuring carbon reduction and use that for this metric. Continuing to add carbon to the atmosphere is the true carbon tax. The goal of the UK is a 50% reduction also, their approach to measuring the goal could also be applied in the US.
- Increase the percentage of Net Zero Buildings by 20% – Achieving energy neutrality can be achieved on many levels, as either a single asset or across an entire portfolio. Once a baseline is identified then progress toward increasing the number of assets with zero energy required external to the organization can be measured, as either an energy reduction or number of assets requiring external energy. This too is not a UK goal, but I believe to be important item to measure and manage.
- Increase collaborative education by 20% – Currently education is segregated by discipline at most universities, and continuing education programs. We need to develop a more collaborative approaches to prepare practitioners for the future. It will no longer be acceptable to only optimize one aspect of the asset, it must support all stakeholders with a primary focus on the impact to the owner. This metric can be measured by identifying which programs truly support a collaborative approach and work to continually increase the number of programs taking an integrated approach to communication. This too was not a goal set by the UK in 2011, however, since then they have been working with the US based Academic Interoperability Coalition (AiC) to focus on transforming education to a more collaborative environment.
The first step in achieving these goals in the United States will be to establish a baseline from which we will begin measuring. The second is agreeing to the metrics by which to measure progress. Suggested metrics are included in the definitions above.
The UK began their effort seven years ago, assuming we begin in 2018 a ten-year goal can be reached by 2028, just 3 years after the UK reaches their goal. Finishing earlier would be advantageous and may be possible if we are able to focus our energies. Finishing later will put the US at a severe disadvantage as foreign design and construction firms will likely see a very desirable market in the US and legitimately win contracts to design and construct our facilities and infrastructure. We are already beginning to see this occur with several large international construction firms now working in the US. This will only continue and most likely escalate in the years. Failure to react is not an acceptable option and will have long term impact from which we not recover.