This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.
Innovation has been recognized as a driver of performance at both national and business level. Construction industry can extensively benefit from the advantages offered by innovation, however it is widely perceived as being among the less innovative sectors, in part due to its project-based and fragmented nature. Companies no longer innovate on their own, effective inter-organization cooperation ensures the success of innovation in all industries. Despite the lack of emphasis in the literature, this open innovation approach is particularly valid for the construction sector system where innovation is co-produced. The major objective of this research is to investigate the open innovation practices in a construction project setting to explore the enablers of innovation. The case study analyzed is a regeneration project that is a successful example of open innovation. Project parties achieved a series of technical and organizational innovations through cooperation with internal and external parties. The paper explains how collaborative partnership among project members, community engagement, and knowledge management practices helped with creating and sharing ideas along the construction value chain and thereby diffusing innovations. Based on the innovation journey of the case study, the paper provides key lessons that will guide the firms in achieving innovation in collaborative environments.
Keywords: Open innovation, construction projects, collaborative partnerships, knowledge management
The construction industry has always been among the driving forces of the economy however it has also long been criticised for its lack of efficiency in comparison to other industries and its unwillingness to innovate as stated in the Rethinking Construction" report (Egan, 1998), which analyzed the performance of the UK construction industry. The inefficiencies identified in this report pointed to the need for greater partnering and collaboration in the construction industry (Latham, 1994). Dulaimi et al. (2002) have also remarked that the construction industry's fragmentation in combination with poor inter-organizational cooperation hampers innovation. As Blayse and Manley (2004) stated, building and construction is partly manufacturing (materials, components, equipment) and partly services (engineering, design, surveying, consulting, and management). Therefore, the organizational context of construction innovations differs significantly from a great portion of manufacturing innovations (Slaughter, 1998).
Regarding the construction industry, much literature has focussed on how innovation could be implemented in construction projects (Tatum, 1987; Slaughter, 1998, 2000; Winch, 2003) and how construction companies manage the innovation process based on some conceptual models (Seaden and Manseau, 2001; Dikmen et al., 2005), and some case studies (Slaughter, 1993; 1998; Veshosky, 1998; Koskela and Vrijhoef, 2001; Sexton and Barrett, 2003; Cleasby, 2004). The project level is largely ignored in the literature as there are difficulties in monitoring the different activities carried out by different parties in each stage of the project (Dulaimi et al., 2002, Blayse and Manley, 2004). However, as most construction activity occurs at the project level, measurement of the dimensions and elements of construction innovation at that level should be key to improving the innovation performance of such companies. Besides, the role of interrelationships between the participants in a construction project should be investigated in terms of facilitating innovation.
The traditional linear model of innovation has been challenged by a number of researchers (e.g. Kline and Rosenberg, 1986; Von Hippel, 1988) who have put forward the non-linear, dynamic and interactive nature of the innovation process. Chesbrough (2003) coined the term 'open innovation' to describe how companies combine externally and internally developed technologies in a flexible way to develop new businesses. Similarly, Mention (2010) states that innovation is the "outcome of an interactive process between the firm and its environment, as the result of the collaboration between a wide variety of actors, located both inside and outside the firm". Open innovation has received increasingly attention in scientific research, but has mainly been analyzed in manufacturing and services industries (e.g. Chesbrough, 2003; Christensen et al., 2005; Van de Vrande et al., 2009; Lee et al., 2010; Mention, 2010). There is very limited work in the construction area dealing with inter-organizational innovation (Dewick and Miozzo, 2004; Doree and Holmen, 2004; Holmen et al., 2005; Rutten et al., 2009) that emphasize the importance of cooperation among the members of the construction network. However, none of these studies investigated the role of all possible stakeholders including the end-users or the community that are going to benefit from the project as well as the external parties such as the universities and consultants.
The project level analysis is often neglected in studies on construction innovation. Ozorhon et al. (2010) investigated the ways innovation occurs throughout the life-cycle of a construction project and thereby help understand the different stages of the innovation process in the construction value chain. This study aimed at exploring a number of technical and organizational innovations and the role of stakeholders involved within the process of generating ideas, converting these into practice and diffusing them across the organizations. The major objective of this paper is to discuss the innovation journey of in a construction project, by building upon previous research by Ozorhon et al. (2010), and introduce an open approach to analyse construction innovation. In this respect, an award winning urban regeneration project in the North West of the UK was selected as a case study. The case highlights the role of collaborative partnership, community engagement, and knowledge management as enablers of innovation. The main technical and organisational innovations achieved in this project include modern methods of construction and lean production. The paper summarizes the activities, tools, and methods used to convert ideas into practice and diffuse them along the supply chain and transfer the experience and knowledge gained to future projects.
NATURE OF INNOVATION IN CONSTRUCTION
Innovation has a context sensitive nature and it differs in every sector with, for example, patterns of innovation in manufacturing differing from those in services (DTI, 2007). According to Lansley (1996) the occurrence of innovation within the construction industry is often characterised by the widespread adoption of new practices as a result of advances in technological and business processes. Much construction innovation is project-based and unrelated to formal R&D expenditure, so many innovations, particularly organizational or process innovations are neither patented nor trademarked (Slaughter, 1993) and remains hidden at the project level (NESTA, 2007; BERR, 2008). In a complex industry such as construction, firms have to rely on the capabilities of other firms, and often sub-contractors with less understanding of new ways of working, to produce innovations where this can only be achieved by the cooperation between those concerned with the development of products, processes and designs (Blayse and Manley, 2004). Construction services deal with the society; therefore innovation is often more open and user-driven. Project teams aiming at engaging the end-users starting from the early phases of the project designed for the public use are more likely to achieve end-user satisfaction (Barrett, 2007).
In order to understand how innovations occur throughout a construction project, it is essential to understand the role of each project stakeholder both individually and collectively (Ozorhon et al., 2010). It is increasingly accepted that construction innovation encompasses a wide range of participants within what in manufacturing would be called a "product system" (e.g. Marceau et al., 1999). Each stakeholder within the construction value chain has a different responsibility and role in stimulating and achieving innovation. For example, clients can act as a catalyst to foster innovation by exerting pressure on the supply chain partners to improve overall performance and by helping them to devise strategies to cope with unforeseen changes (Gann and Salter, 2000), by demanding high standards of work (Barlow, 2000), and by identifying specific novel requirements for a project (Seaden and Manseau, 2001). Contractors, on the other hand, play a mediator role in the interface between the institutions that develop many of the new products and processes such as the materials and components suppliers, specialist consultants and trade contractors (Reichstein et al., 2008) and those which adopt such innovations such as the clients, regulators and professional institutions (Winch, 1998). Manufacturing firms invest far more in R&D than contractors and are subsequently more likely to develop product and process innovations (Gann, 1997). Research by Gann and Salter (2000) points out the need for a better conceptual understanding and new management practices to link project and business processes. Project-based firms need to manage technological innovation and uncertainty across organizational boundaries, within networks of interdependent suppliers, customers and regulatory bodies (Gann and Salter, 2000), but in tight time-spans and with little feedback on what works well. The same principle is also valid for the success of innovation both at the project and firm-level. This issue has also been raised by Acha et al. (2005) who investigated the techniques to capture learning in the project-based environments and found poor integration between projects and the organizations.
OPEN INNOVATION PRACTICES
The 'systems of innovation' approach (Edquist, 1997) argues that innovation should be seen as an evolutionary, non-linear and interactive process, requiring intensive communication and collaboration between different actors. Rosenberg (1982), Lundvall (1992), Pavitt (1998) and von Hippel (1988) among others, have addressed the interactive, cross-disciplinary and interorganizational nature of innovative learning. Chesbrough (2003) defines open innovation is defined as "the use of purposive inflows and outflows of knowledge to accelerate internal innovation, and expand the market for external use of innovation, respectively". It is contrasted with the old model, termed "closed innovation" in which companies control the whole innovation process, i.e. generate their own ideas; do their own research and development to transform ideas into innovative products; produce these products; market them; distribute them; service them; and finance them on their own (Chesbrough, 2003). The traditional, internally focused model for innovation is being replaced by an open innovation system with the aim of strategically leveraging both internal and external sources of ideas (Swan et al., 2009) that enables the knowledge exchange with a range of partners (customers, supply chains, universities, etc.) at regional, national and international levels. In this paper, two attributes of open innovation are discussed in terms of enabling innovation in construction, namely collaborative partnering between the contractors and clients, and knowledge management practices.
Cooperation with stakeholders
Literature provides evidence of the benefits of cooperation on innovation performance in manufacturing and services industries (e.g., Klomp and Van Leeuwen, 2001; Loof and Heshmati, 2002; Vanhaverbeke et al., 2002; Cincera et al., 2003; Miotti and Sachwald, 2003; Zeng et al., 2010; Mention, 2010). Beyond formal cooperation, information from internal and external parties also plays a critical role in knowledge transfer and consequently influences the firm's capacity to innovate (Linton, 2000).
It was stated in "Constructing the Team" report by Latham (1994) that the construction industry was ineffective, adversarial, fragmented, incapable of delivering for its customers, and lacking respect for its employees. The inefficiencies identified in this report pointed to the need for greater partnering and collaboration in the construction industry (Latham, 1994). This issue is futher discussed in "Rethinking Construction" report (Egan, 1998) that identified five drivers of change which need to set the agenda for the construction industry being committed leadership, a focus on the customer, integrated teams, a quality driven agenda, and commitment to people (Egan, 1998).
The partnering approach has embraced the principles outlined in these two reports and, resulting in many cases of 'best practice' for the last decade. Partnering has been acknowledged by many researchers and practitioners for the last two decades as an innovative approach for the procurement of construction services effectively (Badger and Mulligan, 1995; Black et al., 2000; Li et al., 2000). Similarly, the scholars have argued that successful innovation often requires effective cooperation, coordination and working relationships between the different parties in construction projects in particular, the relationship of contractors with subcontractors or suppliers of materials, the government, universities, architects or engineers, clients and international collaborations with other contractors (Gann and Salter, 2000; Ling, 2003; Dewick and Miozzo, 2004; Doree and Holmen, 2004; Miozzo and Dewick, 2004; Holmen et al., 2005; Ozorhon et al., 2009).
Partnering involves two or more organizations working together to improve project performance and organizational relations through agreeing mutual objectives, devising a way for resolving any disputes and committing themselves to continuous improvement, measuring progress and sharing the benefits (Egan, 1998). Partnering provides the basis for project participants to adopt a "win-win" approach to solve problems and foster synergistic team-work among themselves and can bring about advantages regarding quality, safety performance, sustainability, dispute resolution, human resource management, innovation, and also time and cost reductions (Barlow et al., 1997; Egan, 1998; Chan et al., 2003).
Communication at a social level and asking for the input of the end user of a product, process, or a service helps co-creation of innovation. Understanding and communicating end user needs to the wider project team is critical success factor for construction projects. Similarly, client satisfaction and improvement of services have been cited as two of the major benefits of innovation in construction (Ozorhon et al., 2010). This would seem to indicate a mindset within the industry that still views innovation from a technology push rather than a user pull perspective despite the growing recognition in the literature of the importance of service driven innovation (Barrett, 2007). It can be stated that besides collaboration within the construction value chain, end-user/community engagement is one of the significant enablers of innovation in regeneration projects (Ozorhon et al., 2010).
Knowledge management (KM) is recognised as a vehicle through which innovation and improved business performance is possible (Kamara et al., 2002). It is suggested that knowledge workers also increase innovation by turning tacit knowledge into explicit knowledge and by passing tacit knowledge onto others (Nonaka and Takeuchi, 1995). Similarly, as Barlow (2000) has stated the regular use of external organisations with different knowledge bases is beneficial provided that the collaborating recognize the value of knowledge and apply it strategically.
Roper et al. (2008) model the innovation value chain as a recursive process that has three main links such as 'knowledge sourcing' to assemble knowledge necessary for innovation, 'knowledge transformation' to translate knowledge into physical innovation, and finally 'knowledge exploitation' to improve the enterprise performance. The diffusion of innovation is a key stage in knowledge sharing that is defined as "the process by which an innovation is communicated through certain channels over time among the members of a social system" (Rogers, 2003). The use of knowledge management approaches is an effective enabler for the diffusion of innovations within and outside the organisations. In this regard, knowledge management is essential for ensuring that the full project team are aware of and understand the latest techniques that are to be used on the project.
Since knowledge is the crucial component of innovation, universities also play a major role in the innovation process (Van Looy et al., 2003; Marques et al., 2006) especially through collaboration with industry (Tijssen and van Wijk, 1999; OECD, 2002). There is an increasing amount, and many different types of engagement that occur which facilitates knowledge transfer between the higher education sector and industry (Lambert, 2003). These include personal contacts and staff exchanges such as visiting professors/guest lecturers or industry secondments; business support and consultancy; collaborative and contract research; and establishment of joint ventures, licensing agreements and spinout companies.
Questionnaire surveys and case studies are two different means of measuring construction innovation. There have been relatively few large-scale surveys of innovation in construction and what role these processes of innovation have in reshaping practices (e.g. Reichstein et al., 2008). Case study methodology has been rarely adopted to investigate innovative activities in the construction sector (e.g. Acha et al., 2005). In this research, in-depth qualitative case study methodology has been adopted to gain full understanding of the project-based practices and corporate policies on achieving innovation in collaborative environments. Participation of relevant parties in these project-based interviews was critical in terms of obtaining the contradicting opinions and/or communalities based on each stakeholder's viewpoint. By this way, the interaction of the actors involved in the selected projects are examined and discussed. Although the results cannot be generalized, through experiences explained in the case study and the mechanisms outlined, the findings are expected to raise awareness in terms of co-producing innovation for similar projects and correspondent key parties.
This paper builds upon the research done by Ozorhon et al. (2010) in collaboration with the Centre for Construction Innovation Northwest in the UK, which involved a questionnaire survey that was administered to the applicants of the 2009 North West Regional Construction Awards and following case studies with the award winners. The awards entrants (for the survey) and winners (for case studies) were chosen as they all believe that they are at the leading edge of construction in the region and were willing to share their innovations, and so the sample should provide an insight into perceived best practice. In this paper, the innovation journey in an urban regeneration project is discussed that was notable with its open approach to innovation. The innovation experiences in this project are explored through 1.5-2 hour-interviews with three participants (client, the project manager, and business development director). The interview data and application forms for the Awards are used to generate the innovation stories for the cases.
The following issues were addressed during the interviews: drivers to innovate; inputs of innovation (investment and internal/external knowledge sources); major innovations (technical or non-technical); enablers of innovation (partnering, community engagement, knowledge management); major tools/strategies employed to realize innovation; barriers to innovate; roles of each stakeholder in stimulating/implementing the innovation (relations, communication, and cooperation among project participants); major benefits/impacts of innovation (productivity, profitability, image, new markets, etc.); and finally the lessons learned from the innovation process.
CASE STUDY ILLUSTRATING OPEN INNOVATION PRACTICES
The Regeneration Project in Cheshire, UK was a unique 10 year partnering regeneration scheme that has delivered an award winning range of over 500 units of new housing, as part of the vision for a sustainable future for the area. Since the transfer of new town stock in 1989, the client has been a landlord of the estate together with an additional Housing Trust. Both Registered Social Landlords formed this partnership agreement with the local Borough Council, English Partnerships, and the Housing Corporation. The contractor, the architect, consultants and the structural engineers were brought into the partnership in late 2001 to undertake the housing regeneration phases. The project was started in March 2002. The Regeneration Partnership has been using more than £44m of funding to completely revitalise this estate that was first built between 1968 and 1972. The master plan proposed a comprehensive programme of over 50 individual projects from the redesign of infrastructure and transport to community facilities and modern mixed tenure housing. To date approximately 800 unpopular deck access units have been demolished with a further 400 scheduled over the coming years. These have been replaced with approximately 470 new homes, with a further 650 under construction or planned. The project also includes leisure and environmental improvements. The next phase of regeneration includes the redevelopment of the existing local centre, into a new community hub that will contain a vibrant mix of shops, homes, community centre and health centre, set around a public square.
Modern methods of construction
The UK Government's initiative to create sustainable homes is specified in the CfSH (DCLG, 2006). This code requires the contractors to use innovative products in their construction processes and deliver the specified sustainability performance levels. Due to the recession in private housing market, contractors and suppliers have diverted to social housing. Funding conditions set by the Housing Corporation promoted the increased use of modern methods of construction (MMC) in social housing particularly off site manufacturing (OSM) as a key potential method for promoting sustainability within the construction industry. Sustainability and carbon reduction was a prime consideration for the analyzed case, therefore the project parties committed to achieving high levels of environmental performance.
Building regulations is a significant accelerator of innovation in timber frame production. Timber frame is a tried and tested structural system. It is the most environmentally friendly form of construction available that conforms to MMC and OSM principles. Building Research Establishment (BRE) reported that that modern timber frame construction produces near zero carbon emissions (Reynolds and Enjily, 2005). Timber frame is also renowned for its excellence in energy efficiency terms. As the structures are assembled from components made to manufacturing tolerances, the better fit achieved improves air tightness and hence positively effects energy efficiency. The closed timber frames were used as the structural elements of the superstructure in the project among the many forms to choose from, including advanced and closed panel, volumetric and hybrid systems. By using MMC methods, the closed timber framed panelled units went from ground floor slab to panels in place in just twelve weeks - half the time of a similar traditional build. The wall panels and floor cassettes were delivered to site with windows and doors already fitted in the factory. The benefits of MMC were evidenced in many ways; not only was the site accident free, it was dryer and cleaner for the labour force to work on. There were also benefits for local residents too, with reduced levels of vehicle movements and noise. Through a design focus on energy efficiency, the development received a rating of GOOD in the BRE Eco-homes accreditation. This means energy and water bills will be reduced and reflects the special design attention that has been paid to the use of sustainable materials.
MMC required tighter, more reliable processes leading to the adoption of lean principles. Lean construction is "the continuous process of eliminating waste, meeting or exceeding all customer requirements, focusing on the entire value stream and the pursuit of perfection in the execution of a constructed project" (Design for Manufacture Competition, 2005). Lean construction may require more time in the design and planning phases, but this attention eliminates or minimizes conflicts that can dramatically change budgets and schedules. Supply chain management is an important support function for facilitating lean construction. Partnering arrangements with suppliers are based on effective communication of shared objectives of continuous improvement. Each member of the construction supply chain should be made aware of its influence on the overall project. In addition, organizations are required to change their business processes to deliver the expected benefits of lean construction. Standardization of the finishing processes brought benefit to the supply chain, reducing wastage of materials on site as well as wasted operations.
Essentially the combination of lean construction process and modern methods produces several advantages such as saving on programme and associated preliminary costs; not weather dependant; continuity for following trades; less impact on the local community (transport); less waste; a safe working environment; savings on foundation costs; flexibility of design; improved quality; higher achievements under Eco homes and the CfSH.
An Open Approach to Facilitate Innovation
The project has demonstrated the efficient use of MMC and lean construction through the collaborative partnership between the client and contractor, which then extended to the supplier and the consultant; community engagement; and knowledge management practices. These proved to be enablers of innovation all of which are components of open innovation. Each party in the construction network has its own innovation value chain and their individual roles and interactions should be investigated to better understand the co-creation of innovation.
The 'Rethinking Construction' report by Egan (1998) stated that partnering was integral in helping to deliver such projects and to reduce adversarialism, which had confounded previous attempts to encourage better integration and cooperation between contractual partners in the construction industry. This project is a successful example of collaborative partnership that embraced the principles set by Egan (1998) and best practice ideas from around the UK construction and development industry. New product (timber frames) and process innovations (MMC and lean construction) could only be achived through product R&D; considerable investment; strong committment; and collaborative partnership among the supply chain. The basis for all successful business processes employed throughout the regeneration scheme started from the close relationship and integration of the project team. It was essential that all members of the team including key supply chain partners were included in planning and programming as early as possible. The key decision in this regard was to use a procurement approach that enabled early contractor involvement. Increased integration and cooperation between the actors through early involvement of contractors helps team members achieve efficient and value-adding solutions (Korczynski, 1996; Barlow et al., 1997; Briscoe et al., 2004). Early contractor involvement is critical to establish a trust-based cooperative relationship in order to facilitate contractors' contributions in the design stage (Korczynski, 1996). This ensures that ideas can be tested for their buildability and building methods can be developed that are appropriate to the design. Through the partnership, all parties contributed to the achievement of the sustainability targets by taking a holistic approach, developing a clear strategy for driving forward an agenda for the sustainable future for the area; utilising lean construction principles to eliminate waste in every area of operation through costs, time, quality and environmental improvements; adopting a 'zero defects' and 'right first time' approach generating marked reductions in snags and defects at handover; focusing on continuous improvement on health and safety on site for employees and environmental sustainability; and providing employment, training and development opportunities for local people (Ozorhon et al., 2010).
It is not easy to find the product for a reasonable price in the market; closed timber frame production can have high unit costs for the small suppliers, similarly large suppliers are risk averse so they are reluctant to change their operation process to comply with the demanding standards of CfSH. It took the project members some time to discover that MMC could deliver both sustainable and affordable housing. The client and the contractor were strongly committed to the environmental sustainability and wanted to create a competitive advantage in the market. Although at the time of the project was undertaken, most of the suppliers could produce timber frames that meet CfSH Level 3 requirements (standards that were required level at that time), the client and the contractor decided to look for a supplier who could meet the Level 6 that would be introduced in near future. They were able to identify only one supplier that has completed its R&D on Level 6 and they managed to secure a long term partnership with that timber frame supplier that placed them one year ahead of their competitors.
In addition to the supply chain partnership, the client and the contractor jointly invested in lean construction consultancy. They employed a consultant to aid in the development of methods and procedures to improve site processes. The contractor determined to work with the contractor to eliminate the initial cost barriers of MMC in order to reap long term savings and benefits. The agreement to invest jointly demonstrates both partners' desire and willingness to engage other specialists who could help to drive out waste through the adoption of lean. These benefits have been brought through from phase to phase, demonstrating continuous improvement.
One of the most important ingredients of any successful regeneration partnership is the involvement of the local community. In order to ensure that the community involvement continued through the life of a similar regeneration project (Ozorhon et al., 2010), an interest group was established, that was comprised of local residents, community groups and representatives from retailers, leisure facilitators, hotels, restaurants, the police, and commercial bodies. Regular meetings of the community and construction team were held to resolve issues and take forward good ideas. Similarly, in this scheme, residents of the area have been heavily involved in the regeneration process as well as in the development of each individual scheme. Project team members have had the opportunity to establish positive working relationships with the local community, and better understand the needs and wants of the residents affected by the redevelopment. The client, architect and contractor have also worked with local primary schools to involve children in the construction processes as part of their curriculum. This has begun the process of embedding a sense of place and ownership in the community's children, which has been lacking for so long.
Knowledge sharing mechanisms
According to Mention (2010), managers should put in place the mechanisms and tools (such as a knowledge-sharing platform or communities of practices) that foster knowledge sharing within the group to facilitate innovation. This project revealed that effective knowledge sharing and then its management are essential for achieving innovation; not only in bringing the right ideas into a project, but also to ensure that these ideas are known by the entire project team and are diffused to following projects.
The client has been involved in the MMC North West Group of RSL's (funded by an Innovation and Good Practice Grant from the Housing Corporation, English Partnerships and New Heartlands). They have devoted resources from across their group to ensure they understand and are able to effectively deploy new technologies and techniques as they emerge, ranging from renewable energy sources through sustainable housing solutions to MMC to create high value low cost solutions for the clients. They have been very keen to create a true learning culture with their contractor and mechanisms to enable more sharing knowledge and best practice. They together presented at three North West Best Practice Clubs on MMC in 2006.
The contractor has also been very keen to share its knowledge and experience through the supply chain. They have been trying to foster innovation based on their business and innovation plan. In this respect, they discover and share new insights, work with clients to explore new areas, work with suppliers and construction materials companies to field test new products and technologies, and provide training to staff to help them both at a technical level and with soft skills. Their ultimate objective is to be able to meet client needs better and be able to adapt to a changing world. The key actions that will help them innovate both individually and collectively focus on the staff, clients, suppliers, and lean construction. They have introduced a scheme called 'Innovator of the Month' to reward the individuals having exceptional contributions, i.e. who resolve a client concern imaginatively and effectively, get fantastic client feedback, deliver a great project, have a great idea to save costs, improve productivity, make a significant contribution to profitability, generate new business opportunities, just undertake a job with enthusiasm and commitment. They arranged Chairman's lunches every two months to give direct access to the top, where views and ideas can be aired freely. Moreover, they created a sustainability group to research innovation within the industry. Knowledge sharing was initiated within the organisations and extended beyond the organisation through an action learning approach (Revans, 1983) known as 'Innovation Circles' (Lu et al., 2007) that bring together the supply chain in an open approach to sharing ideas and tackling problems. The use of extensive public consultation and knowledge exchange between project participants helped generate ideas and transform them into viable products, processes, and services.
Innovation Summary of the Case
The innovation summary of the case study is illustrated in Table 1. The table outlines the components of innovations achieved by the team members. The main driver of the project team to innovate was the sustainability requirements outlined in the CfSH; other objectives were to improve the quality and safety in the project and achieve cost effectiveness through the 'Rethinking Construction' principles. The major inputs utilized were R&D work; planning efforts; and consultation. MMC (closed panel timber frames) and lean construction were the main innovations introduced in the project. Integrated teams (long-term partnership, community engagement, supply chain integration and good relations); knowledge management activities (innovation circles, seminars); understanding policy and client requirements; conducive company culture and vision; and establishment of a sustainability group within contractor were observed to be the enablers of innovations. However, the project team has encountered some barriers, most important of which were the reluctance of the suppliers; unavailability of products in the market; inexperience of the work force; and resistance from the employees. Through the innovative activities the team achieved to improve environmental performance; reduce the costs; reduce the project duration; improve quality, health and safety; and minimize waste. The overall benefits and impacts of the innovations can be listed as experience gained in MMC and sustainability; knowledge transfer to inform future projects; contribution to organizational learning within the contractor; being an example regeneration scheme; receiving awards; and opportunity to further collaborate with the supply chain members.
Table 1: The innovation summary of the case study
Need and objectives
Client's requirement on sustainability (CfSH)
'Rethinking Construction' principles
MMC ( Closed panel timber frames)
Integrated teams (long-term partnership, community engagement, supply chain integration and good relations)
Knowledge management ( innovation circles, seminars)
Company culture and vision
Sustainability group within contractor
Resistance from the employees
Reluctance of the suppliers
Unavailability of products
Inexperience of the work force
Improved environmental performance
Reduction in cost
Reduction in completion times
Improved quality, health and safety
BENEFITS AND IMPACTS
Experience in MMC and sustainability
Knowledge transfer to inform future projects
Contribution to organizational learning
Example regeneration scheme
Types and patterns of innovation in the construction industry are different in many ways from those of others. The construction industry is largely project based and fragmented; so much of the innovation remains hidden, as it is co-developed at the project level. The link between business level practices and innovation at the project level should be explored to develop a deeper understanding of how innovation occurs in a project setting. Companies can no longer afford to rely entirely on their own ideas to advance their business. Coordination across several organizations is essential to facilitate innovation. Besides construction firms, suppliers, designers, and service organizations play a large part in innovation. Previous research also suggests that strength of inter-organizational cooperation support innovation performance in construction industry, as well as manufacturing and services. In the context of this paper, the open innovation practices were discussed within a case study where collaborative partnership, community engagement, and knowledge management have been observed as the key enablers of innovation. Innovative activities were trigged by the client requirements focusing on sustainability, cost reduction, quality and safety improvements. Building regulations shaped the way the housing developer, contractor, and suppliers worked. The objectives set by the clients were met through the implementation of MMC and lean principles. The case study is also a good example where the contractor and wider project teams have aimed at understanding the end user and thereby provided innovative solutions in response. This user driven approach is often cited as a characteristic of innovative industries.
There are many lessons that can be learnt from this project. Firstly, the collaborative partnership between the project parties that was later extended to external stakeholders was the key success factor. Another important point is that understanding client requirements is essential for initiating innovation in construction. However, the implementation can only be achieved by devotion throughout the whole project lifecycle to break the industry's resistance to change since adoption of new methods is frightening in the construction industry and benefits of MMC cannot be achieved in short-term. Being fully committed and adopting the lean principles, sustainable construction can also be affordable. Sharing knowledge and best practice along the supply chain is critical to improve the culture and skills of the workforce. Experience and knowledge gained in this project can easily be transferred to future projects to ensure cost effectiveness and ease.
The benefits of innovation can only be realised by fully understanding the components of the whole innovation process that is based on knowledge acquisition, transformation, and diffusion. A deep understanding of these stages of innovation at the project level adopting a multi-stakeholder approach can be considered as the main contribution of the study. This research is based on a successful innovation implementation in a project undertaken in the UK, so the variables associated with the innovation performance is limited to the conditions and relationships among the analyzed project. Although the findings cannot be generalized, individual and joint contribution of the project team as well as the community and the university collaboration is emphasized in this research and thereby the 'open' and 'inter-organizational' nature of the construction innovation was illustrated. In a collaborative environment, such as the construction industry, some platforms should be established to enable the knowledge creation and sharing to support the systemic management of innovative activities. The research can be enriched further by detailed work involving more case studies in other countries as well to recognize and measure innovation accurately. The findings of this case study and analysis of additional cases are also expected to provide guidance to analyze innovations in other project-based industries.
The author would like to acknowledge the support of Salford Centre for Research and Innovation and former colleagues at the University of Salford. I would also like to thank the industrial collaborators who have been involved in the case study.