International Construction Law Review
PROMOTING INNOVATION IN CONSTRUCTION
Shy Jackson1
Partner, Pinsent Masons LLP
Construction is in many ways a conservative industry. Materials such as concrete and bricks are still being used, contracts are procured on a lump sum basis and there is a clear divide between employers, main-contractors, engineers or architects, and the wider supply chain. There is no denying that there has also been a great degree of innovation and a lot of effort is going into incorporating technology, using BIM and seeking to create smart cities. There is a general acceptance that innovation is the way to ensure that construction becomes more efficient, more competitive and provides better value.
Earlier this year, the UK government held a consultation asking for ideas for a proposed national innovation plan. Innovate UK is the UK’s innovation agency, sponsored by the Department for Business, Energy & Industrial Strategy, working with companies to de-risk, enable and support innovation. Having identified innovation as an objective, the question is what can be done in order to encourage more innovation in terms of the contractual frameworks and also as a wider industry initiative. This was the subject of a research project supported by Innovate UK and carried out by Costain, the University of Cambridge and the Pinsent Masons LLP.2
WHAT IS CURRENTLY BEING DONE TO PROMOTE INNOVATION
Innovation can mean different things and it will of course depend on the context. In general, it can be taken to mean an improvement in an existing method or process. Innovation has always been part of construction but traditional lump sum contracting does not encourage innovation. As noted in the guidance for the IChemE contract,3 this leaves little scope and margin for innovation as “… when the contractor is limited by a lump sum contract he will be reluctant, or may simply not be able, to explore all the possibilities of optimisation
1 Partner, Pinsent Masons LLP, LLB, LLM (Cantab), MSc (King’s College London), FCIArb, FCInstCES.
2 The report was written by Professor Simon Deakin and Boya Wang of Cambridge University, Adam Golden and Tim Embley of Costain plc and the author. A copy of the report can be found at http://www.pinsentmasons.com/en/media/publications/innovation-in-the-supply-chain/
3 2013 IChemE Form of Contract Lump Sum Contract: (The Red Book, 2013) 5th Edition Guidance, at p 79.
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