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Commitment is a funny word really. People make and break commitments to each other on a regular basis. Time commitments both prevent and enable extra-curricular activities. Commitment to a specific pursuit may be both hugely rewarding and debilitating to other parts of your life at the same time. My favourite analogy for commitment is the consideration of a plate of bacon and eggs – where the chicken is definitely interested, but the pig is fully committed!
NSW Government's 2023 Progress Report
In December 2023 the NSW Government released their Progress Report on the 10 commitments they made to the construction industry, first published in 2018. Despite the fact that it’s now at least 9 months old and the 2024 report will be issued relatively soon (perhaps I have not been committed to writing this blog), it’s worth reflecting on a few items contained within it.
At the risk of spoiling the ending, and in the hope that you will still read to the end of this piece, there are both some really positive items and some areas that leave you with more questions than answers. We will focus on three specific areas – KPIs in general (across all ten points), a paragraph from within Commitment 3 (Standardise contracts & procurement methods), and Commitment 9 (Improve skills and training), especially since this is the most relevant to Elemental Projects.
Measuring Project Success Through KPIs
Why do we set KPIs up? Generally, I’d suggest that it’s to enable the monitoring and reporting of items that we consider important to our organisation's success. To this end, you can see how the KPIs listed in the Progress Report relate to each of their categories and define success. I don’t take any issue with the KPIs that are listed. However, the KPIs that aren’t included (whether by design or accident) raise questions for me.
In Commitment 2 (Adopt partnership-based approaches to risk allocation), there is no measure of how completed projects judged the risk allocation post-completion. The KPIs indicate that projects have been set up with appropriate risk allocation considered in the process. But how does everyone feel about it at the back end of the project, or even mid-way through for contracts lasting more than 5 years? The intent to share risk in an open and transparent manner is laudable and definitely positive for all parties involved – but how has this practically manifested, and what lessons have been learned from it? That would be a very interesting piece of information to understand and would give us insight into the realised, long-term success of Commitment 2.
Commitment 7 (Monitor and reward high performance) performed very strongly in 2023, with all three KPIs reporting a 100% success rate. The use of performance assessments to inform future engagements creates a positive cycle where excellent work can be rewarded with further opportunities, which is great for the industry. A world where we are striving to be the best that we can be, rather than engaging in a race to the bottom to cut costs, is a significant boon. The subsequent question that this raises relates to the standardisation of assessments – are they all being conducted in the same manner, with the same intent?
Acknowledged, there are guidelines and criteria outlined to facilitate consistency of reporting, but there is always room for interpretation. The huge number of people conducting the assessments means that there could be a variation in their approaches, for a multitude of reasons. Perhaps it would be interesting to see how many completed performance reports were disputed – gauging how industry has accepted (or not) the completed reviews.
Generally, the KPIs have been set up to track the implementation of controls, rather than measure how effective each of these has been. This would be a positive evolution for the KPIs to capture the retrospective success (or failure) of the intent of the Commitments, rather than just the compliance with implementing them. This isn’t a major fault – it’s important to set things up correctly – and six years into the process, it would now be great to understand the impact that these are having on the industry. Writing KPIs is notoriously difficult – you don’t want to incentivise the wrong behaviours or create unduly tricky or vague administrative processes. Therefore, consideration should be given as to what outcomes we really want to achieve and figure out how to capture and report on them in the fairest, most forward-facing manner.
Commitment 3: Standardise Contracts & Procurement Methods
I think I need to start by saying that there is nothing wrong with Commitment 3 as a whole.
There was just one paragraph in the 2023 Progress Report that made me raise my eyebrows so high that they met my hairline. Here it is:
It is important to note that while some contract models are commonly considered more collaborative than other ‘traditional’ models, genuine collaboration can be achieved under any contract model. This is possible when project governance is structured in a way which promotes a culture of trust and collaborative behaviour on the project.
I love a collaborative contract as much as the next person, and I also agree with the sentiment that any collaboration is possible under even the most stringent of contracts. What I can’t get on board with is the notion of governance being structured to promote a culture of trust and collaborative behaviour. In my mind, governance is the necessary amount of documentation to provide a framework within which a project is delivered. You can have good or bad governance, and each will have its own impact on the project. What governance does not do is impact culture or trust in any way.
Ok, theoretically it can have some impact here, but I would very strongly advocate for the primary factor in determining culture and trust in a project to be the people that are involved in it. Individuals, teams and whole organisations are the bedrock of all culture. Positive, proactive, emotionally intelligent people will enrich and develop a culture, even if it is rooted in the worst possible governance. On the other hand, deceitful, self-centred, ego-driven individuals will drag even the most positively geared and governance-enabled project culture into oblivion.
I appreciate that you can’t measure how each individual upholds the cultural values of a project, and you could determine if project governance has been set up with a collaborative, growth-based perspective at the core, so I understand why this paragraph was written. Ultimately, you need psychological safety and a leadership team that engender the culture you want to achieve, to make a positive culture and trust a reality and not a pipe dream. This is all about people and can be enabled in several different ways. For instance, Elemental Projects runs award-winning, gamified simulations that bring teams of people together under project environment conditions, forging deep connections and developing a spirit of camaraderie that you can take right back into your project with immediate effect.
Commitment 9: Improve Skills and Training
This is the commitment that we hold closest to our hearts at Elemental Projects, because it’s all about training, which is what we are all about. It’s pleasing to see that all bar one of the surveyed projects invested in developing leadership and commercial skills, and we hope that these were made available not just to the existing leaders, but those leaders of the future as well. Leadership is such a wide and exciting topic, it’s one that I love learning more about. Elemental Projects runs an Emotionally Intelligent Leadership course which focuses on the ‘soft skills’ of individuals and helps them focus not only on what they need to sustain their motivation and belief, but also on what others need to achieve the same.
In times of fiscal uncertainty (such as now!), it’s easy to overlook the value that training offers, and it’s often one of the first casualties of a downturn in the economy. The knock-on implications include stagnation and loss of motivation, so consideration should be given to the value of maintaining existing employee satisfaction through investment in training, versus the cost of replacing them should they leave your organisation. In light of the emphasis that the NSW Government has placed on skills and training in the original 10 Point Commitment to the construction sector, it seems they share the same view.
The Future of Project Management in the Construction Industry
To conclude, there are many positive elements outlined in the 2023 Progress Report, and it’s reasonable to hold the view that there has been a positive impact for the construction industry as a result. There is also more reporting to be done to understand how wide this impact has been, and if the initiative has been successful in transforming the paradigm from one generally of adversity as a result of contracts to one of collaboration enabled by contracts. We look forward to seeing what 2024 and beyond has in store for us.
Whatever the future, Elemental Projects remains committed to delivering training that builds up the capability of our future leaders, enables our current project managers to be more efficient, and inspires all to be the best possible version of themselves. All you have to do is be interested.
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