TCA Builders’ Digest is published for the Toronto Construction Association 70 Leek Crescent, Richmond Hill, ON L4B 1H1 Tel: (416) 499-4000 • Fax: (416) 499-8752 www.tcaconnect.com Publisher Robert Thompson Editor Roma Ihnatowycz Sales Executives Nolan Ackman Dawn Stokes Derek de Weerdt Cheryl Ezinicki Pat Johnston Contributing Writers Matthew Bradford Warren Heeley Sarah B. Hood Senior Graphic Designer James T. Mitchell Published by: 33 South Station Street North York, Ontario M9N 2B2 Toll Free: (866) 480-4717 robertt@mediaedge.ca 531 Marion Street Winnipeg, MB R2J 0J9 Toll Free: (866) 201-3096 Fax: (204) 480-4420 www.mediaedgepublishing.com President Kevin Brown Senior Vice-President Robert Thompson Director, Business Development Michael Bell Branch Manager Nancie Privé All rights reserved. The contents of this publication may not be reproduced by any means, in whole or in part, without the prior written consent of the association. Published February 2019 Publication Mail Agreement #40787580 Return undeliverable copies to: Toronto Construction Association 70 Leek Crescent, Richmond Hill, ON L4B 1H1 Phone: (416) 499-4000 • Fax: (416) 499-8752 Builders’Digest Builders’ Toronto Construction Association’s Quarterly Perspective Toronto Construction Association’s Quarterly Perspective PRESIDENT'S MESSAGE John G. Mollenhauer, President Toronto Construction Association CONSTRUCTION ACCOUNTS FOR ABOUT $10 TRILLION IN GLOBAL SPENDING ANNUALLY AND IT IS AMONG THE largest sectors in the world economy. That would be impressive were it not for the fact that our sector is arguably also best known for its long track record of poor productivity. That is about to change. According to U.S.-based McKinsey Global Institute, the “productivity opportunity” in our construction sector is in the order of $1.6 trillion of additional value add that could be created with improved productivity. What matters to TCA members, however, is that tech-savvy industry leaders are taking the bull by the horns and leaving those of us that are slow to evolve in the dust. For what it’s worth, McKinsey believes there are seven action areas related to our industry that will potentially have the most profound impact on productivity. Some are pure commonsense, like reshaping regulation, improving the procurement supply chain and rethinking design. Others, like re-skilling workers and rewiring contracts, are theoretically easier for constructors to tackle. For the moment, I would like to focus my report on the last two action areas in the McKinsey study, specifically improving onsite execution and infusing technology and innovation. Let’s talk first about improving onsite execution. Ironically, leaders in our industry are achieving onsite productivity gains offsite by moving in the direction of a manufacturing style production system. And while component prefabrication isn’t new, the performance metrics associated with a manufacturing style production system are. The dividends of remote sub-assembly are particularly significant in markets like the GTA, which are characterized by skilled labour shortages and site access and/or staging area challenges. What matters most, however, is that industry leaders never stop looking for creative ways to cost-effectively save time and money. The fact that innovators have better access to technology and more enforceable safety protocols in a factory environment versus traditional site component assembly is an added bonus. Construction reinvented: The productivity opportunity 6 | Builders' Digest Quarter 4 2018