Speech to the Conference on
“Architecture And It’s Ethical Dilemmas”
New Hall, Cambridge on 23 March 2004

by

SIR MICHAEL LATHAM, DL, MA (Cantab), Cert.Ed. (Oxon), (Hon) FRIBA, FRIAS,
Chairman, ConstructionSkills and CITB,
Deputy Chairman, Willmott Dixon Limited,
Chairman, Collaborative Working Centre Limited,
Visiting Professor, University of Central England

It is a great pleasure and indeed a privilege for me to be at this Conference today. When Nicholas Ray first invited me 14 months ago, I had considerable hesitation about accepting. Ironically, one of the reasons for such hesitation was that I am proud to be a Honorary Fellow both of the RIBA and the RIAS. So far as I know, the only essential qualification for being an Honorary Fellow of both these great architectural institutions is that one must not be an architect! I am not an architect. Indeed my degree from this university, 40 years ago this summer, is in history. So I thought to myself what will I have to contribute to a learned discussion, much of it philosophical, amongst professional architects, both academic and practising, on ethical dilemmas? I was also affected (though much later) by a splendid cautionary tale told to me quite recently by a distinguished and very well known architect, who was formerly with a large practice but now works in his own very small one. He was describing, with concern and regret I would stress, that the architectural profession had not really bought in at all to the new agendas since “Constructing the Team” in 1994, let along “Rethinking Construction” in 1998 and “Constructing Excellence” in 2002. He then told a sad story - well, sad for me at any rate. He said how a very well known and substantial client, recently retired, had addressed a considerable audience of young architects in the large and very well known practice to which my architect friend then belonged. He asked them, “Hands up who has ever heard of Michael Latham?” Not one hand was raised. He then asked “Who has heard of John Egan?”. About six hands were raised in a group of dozens.

So, when I mused on this incident, I asked myself again, am I the right person to take part in such a distinguished conference as this? But I could not refuse my own University and in any case Nicholas Ray reassured me. So, here goes.

On ethical dilemmas, I also thought of another incident, when I was a Visiting Professor at the School of the Built Environment of the University of Northumbria a few years ago. The Construction Industry Council, of which the RIBA is a member, had just arranged that many of its professional institutions, including the RIBA and the ICE, should jointly sign up to a Memorandum of Understanding about some common learning requirements in their professional courses. One of them was that the students should at some stage have to lead or chair a discussion on an ethical issue related to the construction industry. I was discussing this whole theme with the academic staff of the University. One worried lecturer said to me that it would be very hard to get his students, especially those studying for an HND, to tackle this ethical requirement, as they might not be too good on their feet or know how to chair a meeting. I replied that they should save this task until the students returned from their “year out”, at the beginning of the fourth year. They would have had 12 months experience of construction sites or professional offices and it would not all have been happy, to put it mildly. “Then,” I said, “let them imagine that they are a 22 year old assistant site manager on their first job, working for a major PLC contractor.” The firm is approaching its annual report to shareholders. The figures won’t look good. The directors know that the Stock Exchange will not be pleased, and the share price will fall sharply. So the order goes out from head office to regional offices that costs are to be cut by 5% over the next three months. Eventually it finds its way to the site office, and the site manager hands it to the young graduate saying, “More bull from H.Q. You sort it out, son”. What does he do? Actually, he will go round the site chucking set-offs at the subcontractors, in the hope that by the time they do get paid properly, the heat will be off and everyone will have forgotten all about the 5% cuts. “Now”, I said, “that is an ethical dilemma, and a real one. Get them to discuss that”. The academic staff, most of whom had previously been site based themselves, nodded. They understood that this is what actually happens in the real construction world.

Now of course that is not a dilemma for the architect, or not directly. I want to use my time to address two which are real dilemmas for architects, one of them general and overriding, the other more specific. Both were tackled in “Constructing the Team” ten years ago, and both have moved on since then. They are the role of the architect in an integrated team, and the role of the architect as contract administrator, when faced with impartial decisions under the JCT forms of contract. May I say that these also apply to engineers under the ICE forms, though not the New Engineering Contract, but I shall concentrate on architects today, for obvious reasons.

I begin with the basic theme which permeates both “Constructing the Team” and the whole Egan process. It is that the client should be at the core of the construction process. When I first recommended that ten years ago, it was surprisingly seen as a controversial proposal. One consulting engineer said to me that the client was “a nuisance”. Surely, it was argued, the client knew nothing. He was there to agree to the grand design of the architect and leave all the contract administration to the consultant team, under whatever leadership. He would come onto the site to dig the first bit of turf, and re-appear twelve months later to cut the opening ribbon. His role in between was to pay.

Client empowerment remains a difficult concept for some architects. They naturally see themselves, and very honourably so, as creative people whose inspiration devises and designs the project. One very senior architect wrote an article only a couple of years ago in a prominent construction magazine saying that the architect should not be regarded as part of the supply side team at all. He was an extension of the client. Indeed he effectively was the client, in that he turned the client’s dream into aesthetic and practical reality. The client quite often did not know what he wanted, or could not articulate it clearly in a brief.

But an increasing number of professional clients were seeing it differently ten years ago. They were installing project managers as supply side team leaders, who might be contractors, engineers, quantity surveyors or indeed from external disciplines, but who were rarely architects. When I began my review work in 1993, it could fairly be said that the attitude of the RIBA was that project management did not exist, or, if it did, architects did it. However, by 1995/6, the RIBA Council had set up a task force to report to the President on how the profession could reclaim supply side leadership, and how architects could receive special training for such a role. They came to see me to ask, amongst other things, if the RIBA should set up its own Project Management course. I suggested that they accredit some existing university courses instead. However, they did set up their own course. Perhaps some of you have been on it.

This is an appropriate place to deal in reverse order with my second - and more specific - ethical dilemma, the role of the architect in dealing with disputes between client and contractor. I never had any doubt that the vast majority of professionals, whether architects or engineers, would properly and impartially fulfil their duty to decide such contractual issues, even if they reflected upon the timeliness or adequacy of the production of drawings or instructions from the architect having to make the decision. The problem was that many clients - particularly professional developers - did not see it that way at all. They were increasingly saying “Oi, you work for me, Mr or Ms Architect. What are you doing giving my money to the contractor, especially if it was your fault in the first place? I’ll knock that money off your fee.” Such clients were also increasingly hiring (either in-house or as consultants) those very people whom the RIBA did not think ought to exist - project managers. When I first looked at adjudication in my interim report “Trust and Money” in December 1993, I found growing support for the wider introduction of a system of speedy dispute resolution which was already included in some contracts. For example, some contractual arrangements existed for an adjudicator between contractor and specialist subcontractor under NSC/C, the subcontract for nominated subcontractors, and DOM/1, the domestic subcontract, but they were limited to disputes over “set off” and often amended or deleted in any case. There was some provision in the government’s own contract, known then as GC/Works 1 Edition 3, but it was limited and unsatisfactory. There was also adjudication in the supplementary provisions to JCT 81 (with Contractors Design), based on the British Property Federation formula and in the Association of Consultant Architects’ form of contract. The ICE 6th Conditions had provision for conciliation (Clause 66 (5)), as did the FCEC Blue Form Subcontract (Clause 18(3)). The New Engineering Contract (1993) and the BPF System (1983) made independent adjudication a separate function from that of Client’s Representative (Project Manager), design and supervision. There was considerable support for such a provision to be written more generally into the JCT family or documents. The architectural profession however, took the view in 1993 that JCT 80, the most used building contract, was specifically drafted in terms which laid the professional duty of impartial contract administration upon the architect, and that a separate adjudicator under JCT 80 would be inconsistent with the architect’s professional and contractual duty. Other professional disciplines were more favourably inclined to adjudication provisions, though some engineers, in their consideration of the New Engineering Contract, shared the concerns of their colleagues in the architectural profession.

It followed from my examination of these issues in 1993 that there was widespread, though not unanimous, support for a more direct and speedy system of dispute resolution and there was already some contractual provision for adjudication as a discipline separate from the longstanding arrangements for impartial contract administration by the architect or engineer.

That is why I recommended adjudication, which is now well established and widely used. I do not believe that it presents real ethical dilemmas for the architect any more, and it has relieved some architects of a burden which they did not relish and which caused them a considerable amount of grief.

This movement towards more clearly defined roles for the designer and the adjudicator - which is clearly represented in the New Engineering Contract - has been assisted by the emergence of the project manager, no longer claiming to be an impartial arbiter of disputes as between client and contractor, but seen specifically as the representative of the client. For specialist procurement routes, the construction manager also emerged, a fee based operation where the client employs trade contractors directly. The role of impartial arbiters, sustained to the best of their abilities by architects and engineers, has been increasingly replaced by the external adjudicator. But if I had to give the main reason why I believe the new system has been beneficial to the profession, though contrary to their original concerns and fears, it is because it enables the designer to concentrate on what he or she does best and enjoys most - design.

I turn now to the more basic and central dilemma - the changing role of the architect in modern procurement, especially when working for a well informed or serial client. And I make no apology in returning to the basic proposition of my report 10 years ago - that the client should be at the core of the process. And if that is to be so, what are the client’s wishes, and how are they to be met by the supply side?

I also have one other associated proposition - that an effective construction process is necessary. Again, not everyone accepts this. One distinguished designer - an engineer as it happens - said a couple of years ago that the Egan report was too much about process. What mattered, he said, was the project, and the project was about design. Get the design right, which was vital, and the rest followed naturally. I cannot agree. Of course design is vital. But it is the process that allows the design to be delivered. it is an orderly method of delivering the wishes of the client. If those wishes are to be delivered, the process must be effective.

Indeed, a modern process must increasingly require the progressive reintegration of design and construction, and do so within the overall approach of flexible responses to client wishes. Procurement routes, project and contract strategy are best determined by the client’s informed choice of risk acceptance or transfer. But whether the client has chosen a risk transfer route of design build, a sharing of risk through more traditional approaches, or significant risk acceptance through construction management which also allows for effective sequential design, the client will still be expecting, and be entitled to receive:

1) A clear, direct and single channel of responsibility – whether through a project or construction manager or a design build contractor – throughout the progress of the work.

2) A supply side team which has no ‘fuzzy edges’ of liability, which is closely integrated, and with the same goals of client focused delivery.

3) Design flair and cost consciousness, jointly achieved by a team assembled at the earliest possible stage, and which accommodates best practice buildability.

4) A proper and early involvement of specialist detailed design by the sub-contractors or trade contractors who will actually deliver it on site, a matter to which I will return shortly.

This over-arching pattern suggests that the best results will be achieved by partnering. It is not a procurement route of itself. It is almost an attitude of mind, a cultural approach which sees the team as a seamless robe of client and the whole of the supply side. It must, by definition, include the consultants and the specialist contractors and suppliers. A partnering relationship between client and main contractor is useful, but is not complete. Best Practice demands a supply side assembled together on a best value basis, initially involving competitive interview based on quality, but not price, followed by building up the design and the price on an open book basis which allows the most effective value management. Repeat clients will then wish to keep such teams together for future work, while periodically ensuring that best value remains best value by interviewing other potential team members. Such an approach will ensure:

1) The client has a team which is specifically signed up to the client’s own goals.

2) Proper attention is given to quality, by involving the designer at the earliest stage.

3) Equally, that the buildability of the scheme proceeds concurrently with the design, and allows for the maximum amount of value management, directed towards stripping out all non value added costs without at the same time simply attacking quality or appropriate specification.

4) The client’s financial advisors become part of the team as well, not there to provide person-on-person marking but to build up the costs on an open book basis with the whole of the supply side.

The team will then work in an integrated fashion. There will be no hierarchies, in that all have skills which are essential to the project. The conceptual design is crucial to quality and to client satisfaction, as well as that of the wider environment and posterity as a whole. But so is the specialist design of the ductwork, or the installation of mechanical and electrical services generally. An ugly and inconvenient building is unwelcome and undesirable. But a beautiful and harmonious structure which does not work internally will enrage the client and all the occupants.

The team will, hopefully, work in physical proximity in many cases, or, if not, in cyber space proximity with immediate access to information at the click of a mouse. The use of the most modern IT techniques, coupled with virtual reality in design, gives the client, as part of the project team, a full and early insight into the options before irrevocable decisions have been taken. We are still a long way from adopting the most high-tech methods of communication in the industry, and their absence results in delay, confusion and subsequent waste. I wonder how many projects still involve a sequence of architect printing out some CAD drawings, faxing them to some project manager, who in turn photostats the fax, scribbles on a message and then faxes it on to a site manager who in his or her turn photostats the fax and distributes copies to sub-contractors’ operatives on the site as working drawings. With proper use of IT by all involved, and compatible systems, the original drawings could have gone straight from the architect’s computer to the laptops of those on site, for real time action without any intervening delays, or, even worse, misunderstandings through poor quality reproduction of scribbled faxes by photocopiers. To those who say that such gizmos add to overheads and there is no room for them in tender preliminaries or the consultant fee bids, we can only reply that the same must have been said about telephones in the 1890s, faxes in the 1970s, and mobile phones in the early 1980s, and which was actually said to me about virtual reality models in 1994. No one loses a competitive edge by investing in value adding state of the art technology. They are much more likely to lose it by failing to make such investment when their competitors are doing so.

So, the integration of the team and its very early selection without stultifying hierarchies or lack of effective interfaces must be the theme for these opening years of the 21^st century. It can be called partnering or alliancing, and there are a number of excellent reports which plan the route map and many real experts to build up proficiency and commitment amongst the partners, both of the supply and demand sides. There is still a long way to go to move generally towards what the Reading Construction Forum saw as ‘third generation partnering’, with the effective delivery of supply chain management throughout the process.

Partnering must be here to stay, since it makes so much more commercial sense for everyone than adversarial approaches, particularly for the client. But there is still a long way to go before the message is really spread throughout the supply side process and understood by clients themselves. I am frequently asked at seminars on partnering what can be done to get the message to more clients that they should move away from the lowest tender approaches. I reply that the industry and the Government need to take every possible step to put that message forward as widely as possible and support it with examples of successful partnering which have benefited clients. Real partnering, entered into willingly by all participants and enthusiastically led by the client, delivers real benefits in time, cost and quality. It is not a panacea. Things will go wrong. The difference that real partnering makes is that it enables all in the process to share the problems and engage collectively in their resolution.

Let me develop a little the issue of the involvement of specialist contractors. I devoted a whole chapter of my report in 1994 to detailed specialist design. The practical reality on site is that most projects in the building sector are still procured on a traditional basis. The client is ‘lay’, ‘amateur’, in that construction is not its core business. Let’s imagine a medium sized, family owned and privately run manufacturing company. They are doing well. Trade is brisk and their old fashioned, nineteenth century factory is too small. They have a choice either to expand on the existing site in the centre of the city or move to an industrial estate and a new, purpose built factory on the edge of town. The directors meet together as a Board. They decide to go for a new building. They choose an architect. The architect will do a conceptual design and will choose a consulting engineer who will advise on the structure and perhaps also the mechanical and electrical systems, and do conceptual designs. Some other consultants such as landscape architects may also be involved. After the design and the brief have been agreed, at least initially, between client and architect, tenders are sought from main contractors. They in their turn seek tenders from specialist contractors, and both sets of tenders are usually sought too quickly. Only after the team has been put together, frequently on an adversarial basis with prices which are too low, will the successful specialist M & E contractor be able to see the full picture of how the conceptual design and practical buildability will fit together. Often they do not fit, and then the M & E has to be reworked. Sometimes that rework will take place before going onto the site, but all too often it will only happen when the project is already underway. The result is added cost, claims, delays, and possible litigation. It is certainly frustration for the client.

All that could and should have been avoided. Effective partnering would have involved the M & E specialist, and others involved with design such as cladding or piling, being chosen on a quality first basis at the first stage. If a competitive route had to be followed, it would be best if it was a two stage tender system, with price only coming in at the second stage, preferably with the contractor being the only bid under consideration by that stage. It is then possible for the conceptual designers, the main contractor, the cost consultants and any other team members to work with the specialists to get the design right the first time. This is the essential stage for effective value management when the whole team uses its collective expertise to design out wasteful or non-value adding elements. That does not mean just substituting cheaper M & E kit, though sometimes there may be savings to be made in purchasing policy. What it does mean is producing a design which can be implemented effectively and professionally, with all parties to the project valuing the whole project and not just their part of it.

The opening years of this decade must also see more progress on the Egan targets. In my report in 1994, I called for a 30% reduction in real construction costs by the year 2000, a 5 or 6 year period, depending on when one began to set the clock. I produced that specific recommendation for a very clear reason. Anyone could see that there was a great deal of waste in the construction industry, much of which was incurred before the team went onto site at all. About 2/3rds of such waste arose through the inefficient divorce between design and construction. If the team could be assembled early enough and the proper integration of specialists and main contractors achieved, much of this waste could be avoided. Then there was all the waste on site itself, with poor integration of specialist trades, late delivery of materials, unnecessary changes and all the other hassles which every contractor and architect the world over regrets and fears. I could just have said that there was a lot of waste in the construction sector and that we should seek to reduce it by better project management. If I had said that in my report, everyone would have nodded wisely, said “yes, quite right”, and absolutely nothing would have happened at all. I realised that any call to cut non-value adding costs – and I stress costs, not margins – must be specific and contain clear targets.

When I produced my target, there were shouts of horror. “Impossible”, “Unrealistic”, were some of the more polite expressions. But that was not the reaction of clients. One of the client organisations who provided an assessor for my report had first suggested such a target. It immediately caught the attention of the Government and the whole construction process and indeed it became the central focus of the newly formed Construction Industry Board in 1995. A number of clients achieved the target. Some exceeded it. Some, including Sir John Egan’s BAA, thought it too low anyway, and looked for 50% by 2000. The target soon ceased to be controversial, and discussion shifted to detailed mechanisms of achieving it.

The Egan Report in 1998 set 7 targets, all quantified. They were to reduce capital costs by 10% per year, construction time by 10% per year, defects on handover by 20% per year, reportable accidents by 20% per year, and to improve by 20% per year predictability (on time and within budget) and productivity and turnover and profits by 10%.

In some ways I regard the most important Egan target as that which seeks to reduce defects on handover by 20% per year, leading to a defects free environment over a five-year period. The immediate response of many of the industry to this target was that it was impossible. Some even thought that it undesirable. One architect said to me that a defects free culture would lead to a safety-first environment and be fatal for new, innovative and risk taking design. I can understand that argument, though I do not agree with it. The industry in the UK regards defects as normal. There are even clauses in the standard forms of contract for both building and civil engineering which prescribe defects liability and rectification periods. ‘Snagging lists’ are expected, and with them goes the system of retention, itself a source of significant cash withholding and abuse for both main and specialist contractors.

To those who say we must expect defects, I have one simple response. I understand your scepticism. We all know the structure of the industry makes it very likely that defects will occur. But there is a basic question. Hands up who wants to fly in an aeroplane which does not have zero defects. Who wants to go to a hospital operating theatre or a dentist’s chair without a zero defects culture? We certainly expect a zero culture there. There are now some major clients who are writing into their contracts that the project is to have zero defects, and, as a result, they are removing any requirements for retentions throughout the supply chain. This is an Egan target which will not go away. Just think of cars or TV sets 30 years ago, how often they used to break down, sometimes within days of coming out of the factory. Then think of them now. Next, think of construction. We have to have the same consumer focussed approach. And it will not do to say that manufacturing, with its repetitive processes, is totally different from construction, where every site is different, it may be raining, there is no standard design, the work is mostly sub-contracted, manufacture and installation of components are undertaken by different companies and a dozen other excuses. Think instead of the similarities, and it does not matter whether we talk about the top footballer or pop star with a Ferrari or you and me with our small family hatchback car. At the end of the day, the process for assembling the Ferrari and the family Ford is the same – a series of outsourced components manufactured by sub-contractors and assembled together in one or more sites to complete the product. Construction is not dissimilar.

Lastly, but with some trepidation, I turn to the issue of design quality itself. Over the last twenty years, clients, sometimes in exasperation, have increasingly concentrated upon the process and buildability of a scheme, and demanded single point responsibility for delivery. Architects have felt marginalised by this and have complained that the status of architecture has suffered, particularly with the growth of design build procurement. I understand that, and have some sympathy with it, though more and more well known architects act on a novated basis to design-build contractors nowadays. But leaving that aside, there is, I sense, a real swing of the pendulum back towards design. It is not against design build as such, which remains an efficient and productive procurement method, and one which in any case has many varieties and different degrees of risk transfer to the contractor. Rather, it is to emphasise that design should not be minimised, whatever the procurement route, and that the creative instinct of the architect or engineer should be harnessed jointly with the skills of the constructor. In short, that buildings and engineering projects should look nice as well as working. To coin a Gertrude Stein-type phrase, a shed is a shed is a shed, and no one wins any design awards for it. But we do not want a land full of sheds, though they have their place. Design should be creative, bold and striking. It should be practical and it need not be expensive. Clients can insist upon it, and treat designers properly. The full integration of the designer within the team will allow for the flow of his or her talents without losing sight of client requirements and buildability, and on a properly remunerated basis.

The first decade of the 21^st century, symbolised so dramatically by the London Eye and a number of other grand projects, will hopefully be a period when designers recover their morale and are allowed wide expression of their free spirits, but as part of a disciplined team working closely with the client to deliver his or her objectives in a best value for money way. I believe this is increasingly happening, and I welcome it. Old barriers against creative teamwork have broken down - not that they were all that old. Most of them only emerged, almost by accident, in the nineteenth century.

This decade must also be the era of the client. There will still be thousands upon thousands of small jobs, many of them repair and maintenance, for domestic customers who will be uninstructed, price driven lay clients. But for the larger and medium sized jobs, the priority over the next few years is to ripple down to prospective clients that there is a new culture in the industry which is based on teamwork and which aims to deliver best value. But it makes demands on clients as well as giving them commercial advantages. They need to choose their building or engineering team in the way they would choose a new car, a holiday or their own home. They would not simply buy the cheapest holiday resort, car or house which they could find. They would look instead for the one which was best for them, and which suited their preferences and their ability to pay.

So, finally, what about those ethical dilemmas? For the main issue, the role of the architect, there will always be differences of opinion about this. Architects are not what the politicians called “lobby fodder” - obediently doing what they are told by some higher authority, in the case of MPs their whips. They are creative, highly educated people with an instinctive belief in their profession being a branch of art. When I was an undergraduate here, my next door neighbour in my college was reading architecture, which then called itself very emphatically the school of architecture and fine arts, with the emphasis on the last two words. It was an education, not a vocational training course. Many architects who graduate will never actually practice their discipline. Others - many others - will work in one-person practices, fiercely independent and trusting to their own creative skills to translate fine buildings for private clients from their minds to reality. I doubt if the dilemmas which I have discussed today will influence or trouble them. Whether they will earn a comfortable living from their inspirations is another matter. I hope they do, and wish them well. But the facts of business have moved against such independent free spirits.

But there are other architects, equally creative, equally believing in their artistic skills, to whom best practice and team work come naturally. Sometimes they will lead the team, for other projects they will not. They may be designing exemplar schools for “Building Schools for the Future” initiative, or they may be working in a novated role, doing the detailed design of someone else’s conceptual work. To them, the projects and the client’s wishes are always paramount. They know that their role is essential. They hope that the client will see the project as contributing to the wider environment as well as being cost sensitive and buildable. They understand that the process of design and construction is best realised as seamless role, where all involved value the whole project, not just their individual part of it. This is not marginalisation of design. It is its effective realisation without conflict in the 21st century.

Does it work? Yes. Is it always working? No, because many are not signed up and that applies to all parts of the demand and the supply sites. Will it ever finish? No - best practice never finishes. Are there any aphorisms which capture this process? Yes, I believe there are two. The first comes from an American business guru, and it matters equally to the finest design practices as to any other form of commercial activity. “When you think your business is through changing, you’re through.” And the second is one which I regularly use, and it is this. “If you always do, what you always did, you’ll always get what you always got.” Clients in 2004 demand more than that.