UK Construction Key Performance

Indicators
Presented by: Tom Crane, Economist
Date: 11th February 2015

The 2014 Report

Free to download from Glenigan- just
search Construction KPIs 2014
Headline findings on Client
Satisfaction, Project Predictability,
Profitability, Environmental
Performance, Industry Workforce,
Consultant Performance
Industry benchmarks are tip of the
iceberg.

Market Conditions
Double dip recession

Construction Activity

120

Renewed pressure from

public sector cuts in 2011
& 2012

Gradual private sector

recovery
Costs have risen
alongside improved
volume

110

100

Current Prices - Index 2006 = 100

Initial slump falls in

private sector work in
2008 & 2009

90

80

70
New Orders
Output
Underlying Project Starts
New Work Output

60

50
2006

2007

2008

2009

Sources: ONS, Glenigan

2010

2011

2012

2013

2014
ytd

Property Market & Construction Prospects

10

% Annual Growth

Government looking to private

sector to lead the recovery
Public sector capital funding
constrained by Budget deficit
Improving consumer
confidence
Broader housing market
upturn in 2015
Office Market strengthening in
major conurbations
Retail property facing
structural change
Infrastructure investment plans

0
2013

2014

2015

2016

-2

Household Consumption

-4

General government
consumption

2017

2018

Business investment
-6
General government
investment
-8

-10

Source: OBR, Autumn Statement 2014 Outlook

2019

Construction Costs
10%

Construction Inflation Accelerating

8%

4%

2%

0%

Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3

Change on a year earlier

6%

-2%

2006

2007

2008

2009

2010

2011

2012

2013

2014

All work

-4%

New Work
-6%

Source: ONS Implied Construction Output Deflator

Industry Profitability Squeezed

1,400

Construction Company
Insolvencies

Profitability
10%

1,200

9%
8%
7%

Median profitability

No. of Construction Firms

1,000

800

600

400

6%
5%
4%
3%
2%

200
1%
0
Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3
2007 2008

2009

2010

Source: Insolvency Service

2011

2012

2013

0%

2014

Sources: Companies House & KPI Survey

Respect for people

Staff Turnover

6%

5%

Median % staff turnover

Low staff turnover

as departing staff
are not replaced
Staff loss begins to
fall
Rise in skills base

7%

4%

3%

2%

1%

0%
2006

2007

2008

2009

2010

2011

2012

2013/14

Customer Satisfaction
90%

Client Satisfaction

% rating 8 out of 10 or higher

85%

80%

75%

70%

65%

Product

Service

Value for Money

Defects

60%

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013/14

On time & to budget

Time Predictability

80%

Cost Predictability

90%
Design

Construction

Project
80%

60%

70%

Proportion on time or better

Proportion on time or better

Design
70%

50%

40%

30%

Construction

Project

60%

50%

40%

30%

20%
20%
10%

10%

0%

0%
2007

2008

2009

2010

2011

2012 2013/14

2007

2008

2009

2010

2011

2012

2013/14

Environmental Performance
Designed Energy Consumption
5,000

Construction Process
140

4,500

120
4,000

100

3,000

2006 = 100

kg Co2 per 100 m2

3,500

2,500
2,000

80

60

1,500

40
1,000

20

500

Energy

0
2006

2007

2008

2009

2010

2011

2012 2013/14

Mains Water

0
2006

2007

2008

2009

2010

2011

2012 2013/14

10

Summary
Industry retrenchment
Profit squeeze, reduced workforce

Pressure to meet rising client expectations

More projects delivered to budget
Projects delivered on time
Drop in client satisfaction with product, service,
defects & VfM
Rising to environmental performances challenge
Increased investment required to develop skills base to
meet rising demand and expectations

2015 Construction KPIs

Surveying all projects completed in 2014
Client, contractor and consultant on 7,000 completed
projects, over 25,000 surveys in total.
Centrally collecting company employment,
environmental and project data
Look out for your survey!