Welcome Speech at 2nd CIC-HKU International Consultation Forum: Shaping a More Productive Construction Industry

Event: 2nd CIC-HKU International Consultation Forum: Shaping a More Productive Construction Industry
Date: 25 April 2017

Good afternoon, Ir Eric MA, Professor Norman TIEN, distinguished guests, ladies and gentlemen.  It is my great pleasure to welcome you today to this second international forum co-organised by the Construction Industry Council and HKU.  Perhaps some of you may have joined the first international forum on 21 March in which our Singapore guests shared their productivity enhancement strategies. Today, we are pleased to have invited prominent speakers from the UK and also colleagues from Hong Kong to share their experience in shaping a productive construction industry.

Challenges to UK and Hong Kong

The construction sector is one of the main pillars of the world economy. According to a recent publication by McKinsey Global Institute, the global construction industry employs 7% of the world’s working population, with US$10 trillion spent on construction-related activities each year, accounting for 13% of the world’s GDP. Unfortunately, it is a global problem that our industry has a very low productivity. Labour productivity growth in construction is only 1% a year over the past two decades, compare with 2.7% for the entire world economy.

The Global Construction Perspectives and Oxford Economics in 2016 anticipated that the UK’s construction market would become the largest in Europe, and the sixth in the world by 2030.  For Hong Kong, our construction volume will remain at a high level for the next 10 years, mainly because of housing demand.  Both UK and Hong Kong will be enjoying high construction demand, but facing the same problem of shortage of skillful workforce.

Measures to enhance productivity – 3 “I”

The McKinsey Global Institute advocates that the construction productivity can be significantly boosted with the improvement in three areas started with letter “ I ”.  The three “ I ” stand for “Infuse technology and innovation”, “Improve procurement and supply chain” and “Improve site execution”.  Let me share in more details.

1st “ I ” - Infuse technology and innovation

All of you should have heard of Artificial Intelligent Autopilot Driving System.  It is said that the system can interpret its surrounding environment and control the vehicle that can avoid human errors, reduce travelling time and carbon emissions. Appears that there is no limit to the power of science and innovation.

To be fair, we have some emerging technologies bringing benefits to construction, for example 3D printing for casting building parts, drones for aerial surveying, virtual reality for safety training, robot automation for manual lifting and welding, etc.  We need many many more.

To spearhead the development of the Hong Kong construction industry, the CIC has set up the Construction Innovation and Technology Application Centre.  It will come in operation later this year to facilitate technological and digital development of the industry.

We are also organising the 2^nd CIC Construction Innovation Award this year to encourage international, local and young practitioners to invent new technologies and enlighten our stakeholders.  The deadline for application is 15 August 2017.  Please join us.

2nd “ I ” - Improve procurement and supply chain

New technologies could deliver not only innovativeness, but also improvement in supply chain management. 

This is the second “ I ” – Improve procurement and supply chain.  As we all know, BIM facilitates project co-ordination, improves works quality, and reduces construction waste. Contractors could make use of BIM to achieve progress visualization in real time. To drive for wider use of BIM, the CIC has recently set up an industry-wide Committee on BIM with industry leaders to direct its application in Hong Kong.

Over the years, UK has driven the evolution of the New Engineering contract (NEC) with successful examples like Heathrow Airport terminal 5 and the 2012 London Olympics. A key feature of this collaborative partnering procurement is to save cost and time – hence the efficiency of work. In Hong Kong, we are also yielding some good results from NEC pilots, which set a good start to promote its wider adoption.

3rd “ I ” - Improve site execution

The third “ I ” is Improve site execution. The heart of the issue is to move from relying on process control towards a more holistic production and operating system. In the last forum, Singapore BCA has introduced the adoption of modular Prefinished Volumetric Construction (MPVC) which demonstrates “plug and play” design for manufacturing and assembly.

I look forward to learning more from our UK friends and local colleagues, to guide us formulating a development path for the Hong Kong Construction Industry.  Particularly, I thank our overseas guest speakers, Mr. Don WARD, Professor Jennifer WHYTE, Mr. Rory BERGIN, and Mr. Will WALLER, for travelling a long way to help us.

Wish you all a very fruitful afternoon.

Thank you.

Mr. CHAN Ka-kui
Chairman, Construction Industry Council