More business skills needed in construction - expert
Fri, 08 Feb 2013 6:16a.m.
The plight of contractors who might be left out of pocket by the Mainzeal collapse highlights problems within the construction industry, says a Christchurch company director.
Steve Lowery from My Office says a lack of business skills amongst building firms could slow down the Christchurch rebuild.
“[For] the smaller and medium-sized businesses there are bigger concerns. As a whole, a lot of the guys that are in the industry and owning these businesses are technicians, they are builders and chippies and very good at that, however a lot of them don’t necessarily have the experience or the financial skills to be managing their businesses as well as they may need to be, especially as there’s an opportunity of large growth for these organisations.”
Mr Lowery says in recent years the Master Builders’ certification has focussed on business skills, as well as traditional trade skills.
“The industry has faced these sort of issues in the past and they’re far more aware of that and are in fact getting more members onboard as to ensure they’ve got the business skills to try and avoid this sort of issue for members and clients that are using Master Builder members.”
He says as one of the major construction companies Mainzeal should have had the knowledge to avoid going into receivership.
“It comes as a huge shock. Being one of the leading players within the industry, it was seen as the frontline leader [and] with the financial management skills and the resources they have it would have been expected to be leading the rebuild here in Christchurch.”
Watch the video to see the interview.
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8/02/2013 9:38:33 a.m.
Ed DeLilla wrote:
It is not only business management skills, but also project management skills which are lacking. In an environment where lump sum, fixed price contracts are the norm, contractors need to be able to deliver on their contracts whilst earning a reasonable profit margin. As a professional project manager, I am apalled at the lack of project management systems and expertise I continually encounter. With all the tools available, there is no excuse for contractors to deliver projects late and over budget. Unfortunately, it is not just here in NZ that I encounter this. Having just returned from a couple of years in Oz, it is a real problem there as well. In this business climate, winning work is the easy part. Delivering on the contracts and making a profit is the tricky bit.
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