Business excellence: lessons for the construction industry

The construction industry has been accused of being, at its worst, wasteful, inefficient and ineffective, wasting over £1 billion in 1999 due to errors and rework (Nicholson, 1999). Competitive pressures from within industry, as well as external political, economic and other considerations are forcing the industry to re-examine and improve its modus operandi (Anumba et al, 2000). The message is that to survive and prosper, the industry must change its management and practice. Nevertheless it took the publication of both the Latham (1994) and Egan (1998) Reports, both advocating the use of performance measurement, for the industry to recognise that it needed to modernise in order to tackle the severe problems facing it. However, in order for it to improve, the Construction Industry is faced with a bewildering range of business improvement models and approaches, all with their unique features, to use on their quality journey, all proclaiming to improve organisational capability and results. Hence, the aim of this research is to provide guidance on how these business improvement models and approaches can be used to support and improve bottom-line results to achieve business excellence. The scope of this research is to focus on three industry sectors and companies: Construction (Morgan Est Pic), automotive (Lear, a first tier supplier) and aerospace (Rolls Royce), as proof of concepts. An analysis of the overlap between the business improvement models and approaches, conducted in the literature review, confirms the need for this research. The initial concept adopted in this research is to pursue and evaluate the most popular business improvement models; ISO 9001; the European Foundation for Quality Management (EFQM) Excellence Model and the American Baldrige Model and the business improvement approaches such as Total Quality Management (TQM), Business Improvement Review (BPIR), Six Sigma and other "tools" that help Managers understand the business, such as Balanced Scorecards and the Process Classification Framework (PCR). Accordingly, a theoretical evaluation model was developed to demonstrate where the approaches support the business improvement models. The model was subjected to the empirical feedback of expert interviews and case studies and to confirm its suitability for use within the construction industry. The now developed evaluation model demonstrated that these models and approaches are "TQM" with ISO 9001 providing the support and consistency between them all. Furthermore, the results of a questionnaire survey revealed that ISO 9001 can be the starting point for the journey towards world-class performance. It provides the platform for taking the organisation forward by achieving control over leadership, customer focus and continual improvement. However, it needs to be implemented with a view to excellence rather than compliance. The main finding from this research is that the construction sector still needs to provide major investment in improvement models and approaches to deliver bottom-line results and achieve business excellence.