In 2018 the House of Lords reported that the benefits of modern methods of construction ('MMC') include:
■ 'Better quality
■ Enhanced client experience
■ Fewer labourers and increased productivity
■ More regional jobs away from large conurbations
■ Improved health and safety for workers
■ Ensure buildings meet quality assurance standards
■ Improved sustainability
■ Reduced disruption to the local community during construction'.
The Construction Playbook emphasises the potential of MMC and of 'product platforms comprising of standardised and interoperable components and assemblies.' It requires Clients to collaborate in finding opportunities for cross-sector platform solutions and it states that 'procurements and frameworks should support this'. The Playbook also recognises the potential for 'Greener solutions as a result of an increase in manufacturing approaches' and requires that 'solutions put forward by potential suppliers are accompanied by a whole life carbon assessment'.
Modular construction, offsite fabrication and other MMC solutions depend on factory production lines, and these in turn require the long-term commitments that are created by an alliance. MMC solutions also depend on the prominent and early involvement of manufacturers, and this can be established through a system of Supply Chain Collaboration.
The September 2020 report 'Build Homes, Build Jobs, Build Innovation - A Blueprint for a Housing Industrial Strategy' explains how 'more innovative and progressive contracts reflect earlier and closer engagement with manufacturers, for instance the ACA Framework Alliance Contract (FAC 1) for long-term strategic relationships enabling one or more clients to integrate housing programmes that are delivered through smart construction linked to separate design, construction and operation contracts'. The same report recognises the value of long-term contractual commitments under a TAC-1 term alliance contract where this approach was adopted by the Royal Borough of Greenwich and Ideal Modular.
Supply Chain Collaboration under a framework alliance or term alliance enables the appointed Principal Contractor (whether this is a general contractor or an MMC specialist) to lead reviews of sub-contracted supply chain members that establish longer-term, larger-scale supply chain contracts and attract improved MMC investments and commitments. The Trial Projects have demonstrated how ESI using Supply Chain Collaboration strengthens and improves commercial MMC relationships with subcontracted supply chain members through:
■ A better understanding of the programme of work and an opportunity to achieve competitive advantage by demonstrating proposals for improved design/risk management/programming.
■ The opportunity to win larger amounts of work for longer periods than originally anticipated
■ The opportunity in pre-construction phase discussions to influence directly the approach taken by the Client(s) and/or Principal Contractor(s) to any aspect of the project or programme, so as to improve efficiency and reduce risk in delivery of the subcontractor or supplier work/service/ supply packages.