A version of this article first appeared on the Sustainability Talk & News website, published 6 February, 2014.
As we emerge slowly from the ‘Age of Austerity’, commercial organisations are running lean, with budgets tight and few personnel available to pursue speculative process improvements, or explore new ways of working. Time, money and people are all at a premium and investment is in short supply.
In principle, these market conditions would seem to provide perfect justification and incentive for an approach based around co-creation – where parties collaborate to share, combine and renew metrics and resources, with a view to getting better results, faster and cheaper. Surely working together is smart, now?
Whilst such logic seems easy to accept, its application is not… for Construction. Historically, Construction has been portrayed as an adversarial industry, driven by a dispute culture and long tradition of putting self-interest first. In a sector notoriously bad at sharing and ‘playing nice’, introduction of a collaborative approach calls for as much, if not more, in the way of changing mindsets, as it does modifying practices. So, if the idea is not a natural fit, why bother?
There are two reasons: Firstly, with its diverse development stakeholders, project cohorts and extended supply chains, Construction is effectively in the co-creation game already, whether it likes it or not; secondly (and more importantly), whilst the concept might not be new, the context is.
Estimated to be worth some $3.5bn last year (up 25%), the ‘Sharing Economy’ is a booming new market phenomenon and engine for social change. Using services such as Airbnb, Lyft, or Freecycle, people are choosing to be part of a revolution in transactional relationships and participant expectations (fuelled by advances in digital and mobile technologies). All around the world, individuals are trading, sharing and swapping peer-to-peer (P2P), across communities and continents; plus collectively, as the ‘crowd’, they are sourcing, funding and growing (with revenues of $5bn forecast for 2013).
There is a disruptive and dynamic consumer trend and there is also an active and responsive business case. In business-to-consumer (B2C) and product markets, global brands and manufacturers such as Nike, BMW, Coca-Cola and P&G have all developed strong co-creation channels and programmes already, plus point to impressive figures for such as waste reduction and productivity gains. Operating systems and culture are described as open and innovative. Benefits include creation of shared value, social good and equity (in every sense of the word), with an implied mandate as reward, plus reputational plaudits for transparency and governance.
Make no mistake, this arena is unashamedly commercial and seriously competitive: In effect, ‘Sharership is the new Leadership’.
Three primary business routes provide for co-creation of shared value:
1) Engaging upstream with customers – opening up the design, specification and procurement processes to improve understanding of value generation and refine its delivery together;
2) Working with the supply chain – sharing information and negotiating optimised solutions, so driving efficiency, encouraging and enabling innovation, to mutual benefit;
3) Acting jointly with peers/competitors to tackle important technology/policy/market breakthrough issues.
The latter (and least common) avenue is where Construction has achieved one of its first notable co-creation successes, with the launch last year and ongoing development of the Supply Chain Sustainability School, bringing together rival contractors to help address social and environmental issues in procurement, contracting and sourcing. With literally thousands of sub-contractor and supplier members registering for free sign-up, the initiative offers a prime example of collaborative and creative thinking and doing, driving the sustainable construction agenda. As evidenced by the School, the co-creation lesson to learn is essentially simple: It’s good to share, even in Construction.