EP 139

Paul Heming: Hello and welcome to episode 139 of the Own the Build Podcast with me, Paul Heming. Thank you everybody who continues to follow. Share it with your mates. I am inundated honestly with people on LinkedIn now reaching out and telling me that they love the show. And I know that’s all because you guys have been sharing it. So thank you and keep on doing it. As ever, we are continuing our little giveaways and if you go to the show notes, you’ll see who we’re speaking to today, which is very exciting. And you’ll also be able to download and old version, a word version, the old world guys, remember that there’s a new way of doing things. But a PQQ template that we have drafted here at C-link, we pre-qualify contractors all day, every day. We know what we’re doing. We’ve got automated versions of it. We’ve got an entire supply chain management tool, but if you like the old way of working, you can download that PQQ template. You might find it really useful. In the studio today I am joined by Dan Macpherson, who is Executive Director at Henry Riley, who are an industry leading construction consultancy doing cost management, health and safety and project management services among much else. Dan, welcome to today’s show. How are you?

Dan Macpherson: Thank you very much, Paul. I’m very well, thank you. Very well. Really genuinely excited to be on the show and cover all sorts of things. So yeah, really looking forward to it.

Paul Heming: Well, I have to say that you arrived into the studio today with a spring in your step and most people come to speak to me. That’s not, you are beaming from ear to ear. I have to say, I’m taking it as a little bit of a compliment today.

Dan Macpherson: Absolutely. No, I’ve listened to, I’ve done to homework, I’ve listened to lots of the podcasts and you do cover such an array of topics and have some really, really interesting conversations. So hopefully I’ll be able to keep it as interesting today.

Paul Heming: Oh, absolutely. I’m absolutely sure of it. So my background, as everyone knows, former cladding curtain wall building envelope contractor. So, I’m from the Midlands. When I moved down to London 12, 13 years ago, the first job that I ever went onto was a job in Canary Wharf for JP Morgan’s, a really, really big client. And Henry Riley were the charming cost consultancy on the job. And my only ever experience, actually, no, I’ve had two experiences working with Henry Riley and that was one of them. And it was a very good one, actually. So just talk to us about, because I know that you bleed Henry Riley because you’ve been at the company for so long. Talk to us about your journey into construction and then about what you guys do at Henry Riley.

Dan Macpherson: Okay, well, I’ll try and keep it as short and sweet and concise as possible, but I joined Henry Riley just over 15 years ago now as a fresh faced 18 year old, fresh out of six Form College. And have been at the company ever since. I didn’t know what I wanted to do at sixth form or after leaving sixth form, but I met my now wife when I was 16 years old. So very quickly I ruled full-time university out. And so I explored my options. It was quite crude really in terms of how I came across quantity surveying. I’ve always had an interest in construction. My granddad was a carpenter for a local firm called Ratty and Kat, who was a kind of quintessential Cambridge name for those living in and around Cambridge. And so had this interest in construction, thought. Well, yeah, looked around what jobs and careers and sort of roles there might be.

Paul Heming: And you saw the sexy quantity surveying option and you thought, oh, that is a bit of me.

Dan Macpherson: Absolutely. Absolutely. That’s exactly it. It’s funny because on previous episodes, I think that some of the early episodes you did, you said you had to, almost had to caveat about being a quality surveyor, but your market is quality surveyors, we’re really cool people. So anyway, I don’t know what it was specifically about quantity surveying. I think I must have seen a job advert or something. So applied to Henry Riley to Graham, who’s my fellow ED in the Cambridge office. And the rest is history. So yeah, I did the part-time degree course one day a week down in Chelmsford, Anglia Ruskin University. So down there for five years. Then combined my last year of university with the first year of APC. So past APC after year six of being with the business, have had a really, really fortunate experience within the company. Not only because I’m surrounded by people that have just been support, so supportive and is a great kind of ethic culture within the organization. And I’ve been supported on my journey all the way through and kind of landed where I am today as executive director in the last, within the last few months.

Paul Heming: Amazing. This is quite funny and maybe I’m going to go a bit, I’m going to share overshare here, but we actually have a remarkably similar tale to how I ended up being a quantity surveyor. I was at sixth form, I actually wanted to be a journalist, but I wasn’t all that interested in going to university and had a look. And I thought, no. And at the time my misses wasn’t going to University either or anything like that. And so I was looking for work. I randomly found the job trainee QSs. I ended up being a trainee QS working way up, doing part-time QS thing. So very similar stories. The only difference is me and that lady are no longer together, that did not last. I’m afraid she was not impressed by me being a quantity surveyor or maybe there was other issues. But anyway, very, very similar. So could we talk then about, so 15 years of experience worked your way up at Henry Riley, you’re a one club man, but can we talk about what it is that you guys do? There’s obviously employers agent, there’s lots of differing roles for QSs at your organization. What is it that you typically spend your time doing or you’ve had the most experience in doing?

Dan Macpherson: So I did start out as a pure kind of core quantity surveyor. In that role, as you’ll know, you get the opportunity to act or I did at Henry Riley in the employer’s agent role that then has much more sort of PM project management type roles and responsibilities to that particular role. And so I then kind of went QS, EA, CA and then more or less, I think the majority of my time is now doing project management and EA, CA and I think part of that leads nicely into the kind of topic of conversation today. But I’m very fortunate in that I love working with people and the EA, CA PM Role is about people. And that’s kind of both internally within my organization and also externally with project teams and being able to work together as a team collaborate, which I know was a topic of conversation in episode 1, 2, 8. When you’re talking about the future of construction and that the industry, we just need to get there, we need to continue on that journey down the path of collaboration. So it’s a very varied role in terms of what I’m doing. Obviously there’s the ever-growing amount of kind of company management, but also I’m a bid up big advocate of still being involved in the day-to-day of delivering projects and training and mentoring QSs and PMs that we have coming through the business. All the apprentices that we have and trainees across the business. And I think it’s been a really great recipe for me personally, but for us as an organization we’re very much people and culture at the heart of everything we do. And if you can get that right, I think the rest follows, which is great.

Paul Heming: Yeah, no, that makes sense. And we’re going to talk a lot about how you can get that right, which I think you’re a great person to speak to about it. Can I just ask you, because I was only ever a contractor’s QS, so the EA, employer’s agent contracts administrator roles were something that I’ve never experienced, never had to, I’ve obviously worked alongside EAs and CAs but never done it myself. When you are, I don’t know, almost like looking at CVs and looking at people to fill to come into your business to do the EA, CA role, is it something where you think, oh, contract, they’re a contractor’s QSs, but background, it’s going to be difficult for them to make the transition? Or is it something where you think if you’re a QS, you can do it? Obviously there’s bits and pieces to the role. Like how do you perceive, because I know from speaking to some younger contractors, QSs, some of them are interested in making that move. How do you assess it?

Dan Macpherson: I think we’re in a period of time where with the skills shortage as an industry, we are having to think differently and look at open the pull up to roles in when trying to recruit. It’s very difficult. It’s a very hot market out there. Again, I know in, was it episode 1, 2, 4 which was the…

Paul Heming: Cool, you have been revising, but you’re showing off now.

Dan Macpherson: I’m cracking out the episode numbers. But no, it was really interesting.

Paul Heming: You’re the one listening.

Dan Macpherson: It was really interesting to hear what he had to say on that episode. Because it is really difficult. But again, there’s kind of two points here. One is that it’s not just about salary. You know, good companies doing good business and how with people and culture at the heart is partly why I said where I am for so long, money and salary isn’t everything. It is for some people, but certainly not for me. And so if you can nail the people and culture piece, then it’s really when you are, I mean, in response to your question, it’s really when we are looking for a particular, so let’s say we’re looking for an employer’s agent for taking an example of a residential project, an employer’s agent just very briefly acts as a representative of the client under his design and build JCT form of contract. That role is specific to that form of contract. And so you are looking, there are those project management skill sets required and those personable skill sets, the soft skills because you have to be able to get the most out of the team, client, contractor, consultants, all included within that. So if you’ve got a QSs, and it doesn’t matter to my mind whether you’re contract a QS, client side QS or even PM kind of going into an EA role, you’ve just got to be able to demonstrate those, the emotional intelligence, the soft skills, the personable sort of skills and organizational skills as part of that as well.

Paul Heming: And so you’ve segued me fantastically onto the topic of today’s show, which is emotional intelligence in project management, commercial management. You wanted to talk about this today because it’s a topic that you talk about a lot, it’s close to your heart. And could you first describe what you mean by that phrase that you’ve just used? Emotional intelligence.

Dan Macpherson: So emotional intelligence for me is about people. And when I say people, I mean yourself and others. It’s not just about being able to work with other people or communicate with other people. And it’s about the ability to understand people, effectively communicate with people, empathize with people and with those skills or being able to do things like diffusing conflict and get the most out of teams whether internal teams, project teams, whatever those teams look like. And the reason I said about yourself and others in that order is because understanding yourself is something that I think we’re on the brink of a new era of understanding neurodiversity and everything that comes with that. And emotional intelligence is very much part of that. And understanding yourself is really, really tricky. You might think you know yourself, but actually when you kind of start doing the homework, the reading, and you start to discover things about yourself which is incredible. So even if you think you know a lot about yourself, there’ll always be more you can discover about yourself. And when you’ve got that point of understanding how you are wired, what your maybe triggers are, strengths, weaknesses, then at that point you can then start to understand other people.

Paul Heming: And so it sounds like it’s a journey you yourself have gone on or are going on. How can you understand yourself in the emotional intelligence context?

Dan Macpherson: So I think, well, I’ll have to probably go back quite a few years now, before I was even born. So, for background, my mum, when she was a teenager suffered with severe mental health issues, was in and out of a local hospital called Forborne Hospital when I was a child. So I ended up spending a lot of time with my grandparents which is where the whole construction kind of piece comes in and my granddad’s woodwork shop, et cetera, which might be the spark for that initial interest in construction. And so I was always surrounded by kind of mental health issues. And my mum was sort of had issues in the era of kind of electroshock therapy, really nasty kind of stuff and self-harm when she was much younger. She was told she’d never have children and she’s worked through all her issues and has been very open throughout mine and my brother’s childhood about talking about mental health issues. So straightaway there’s a familiarity and I’m very comfortable in talking about mental health issues that then affect, well, one of the main reasons actually that me and my wife at 16, we found something in common straight away about kind of talking about mental health in a very comfortable and open way. And finding…

Paul Heming: From that age…

Dan Macpherson: From that age, from mutual territory, those sorts of issues in life. I think they make you grow up quite quickly and you have to become us being thrusted into adulthood in some aspects quite early. And don’t get me wrong, in many aspects I was a child and still very much I’m a child . Yeah.

Paul Heming: You’ve got that bit cracked.

Dan Macpherson: Absolutely. And so you start talking my wife has a very neurodiverse family and it’s really, really interesting the kind of conversations we had discovering how different people are wired. There’s no teaching at school as to how people are wired or how you are wired and maybe looking at your character traits and your personality just doesn’t exist. So I think along with financial management, I think neurodiversity and that sort of thing, those topics would be so beneficial to teach in school. And so I became familiar with the world of mental health and neurodiversity and that kind of one thing leads to another. And even to this day, me and my wife have been together now for 18 years. We are still discovering things about each other and about ourselves. And so the story leads up to this point, COVID 19 hits, we’ll find ourselves under one roof 24/7 and…

Paul Heming: Ah!

Dan Macpherson: Yeah. And my, I suppose behaviors at home at work were kind of being noticed by my wife Katie, and she was kind of noticing that I just go up on my laptop and unless she kind of prodded me with a metaphoric stick, I wouldn’t go out from that laptop for probably an unhealthy amount of time. I was so engrossed in my work that was almost a, it was a distraction from the, and the stuff was going on. But more than that, I really, really enjoy what I do. And so I had all this extra time where I wasn’t commuting, I wasn’t traveling to and from sites. I had crudely 25, 30% extra time to spend working, which I really, really love. And Katie sort of just pulled me to one side one evening and just said I don’t think you could behave as quite normal, Dan, or at least not neurotypical. We ended up having a conversation about the potential for me having ADHD. And so she bought a book, she read it herself. I then read it and yet more conversations and I have discovered so much about myself and I’ve kind of, because it’s a late, it will be a late diagnosis. There’s no real benefit to me to get the diagnosis. But I was on, I went on to five live, two weeks ago because I was on a half term…

Paul Heming: In between listening to own the build episodes back to back.

Dan Macpherson: Absolutely. Yeah. It was the start of summer holidays, the boys were at home. So I had one week off. I just, I went to the gym just a bit of a workout and some relaxation as well. And I got, I just had my headphones in listening to five live and Shappie Cor Sandy was on, and she’s just released a book called Scatterbrain. She’d just recently been diagnosed with ADHD. And my question to her and the conversation that I had with her was about the benefit of being diagnosed later on in life. And there was an element that she said there was a benefit. Because it’s kind of like a validation, it’s like all these things that you thought might be a bit strange or why do I act this way? It’s really nice having the kind of comfort, oh, that’s why I can kind of point, I can point to it, I can put my finger on it. But what she said, which I’m really, really excited about is you can then have the label for lack of a better phrase, but you can then inspire other people and have conversations with other people that are on their journey or have been diagnosed. And you can act as in a mentor, a soundboard as someone who has been on the journey and has gone through life and done what they have in life. So that’s quite, that’s really quite exciting. And I think one of the real interesting takeaways from a previous episode, which was episode 70 where you had Sarah Mcon from mates in mind talking about mental health, is that the suicide rate in the construction industry is two people a day take their own life in the construction industry.

Paul Heming: Crazy. Yeah.

Dan Macpherson: But if you then take that and look at the people with ADHD are five times more likely to attempt suicide than those without ADHD and you combine that further with the fact that when I left secondary school in the noughties, it was very much the case that the message I picked up as a young person was that if you’re going to succeed in life, you go to university end off. And if you’re not going to succeed, there was options for you. You can go to kind of polytechnic type university and…

Paul Heming: What train?

Dan Macpherson: Yeah, exactly. Or train as a in a trade. And so it was really, really interesting taking what I, that discussion I’d had with Shappie listening to Sarah Meek as well, and the statistics that were discussed with you on that particular episode. And I remember in the nineties and naughties that, or a trait of ADHD is that you got poor behavior and that just statistically people away from school. So you pushed away from university. And so it would be really interesting to marry the two together to see if there’s any link, which I’m sure there will be. Because You know, anyone who’s older than me, kind of late thirties, forties, fifties, sixties, who maybe went through school thinking that they may be just not clever or their teachers told them they’re destructive and they are poorly behaved.

Paul Heming: Self-labeled yourself, right.

Dan Macpherson: Yeah. Maybe a significant number of those people are neurodiverse and have ADHD. So it’d be really interesting as far as I can see, there’s not been studies there. And so very much see ADHD whilst it’s got the word disorder in it very much, you can use it to your strength. And I think that’s one of the really exciting things is that those who are neurodiverse, we all have strengths. Everyone in the world has strengths and everyone has weaknesses. It’s just tapping into those strengths, those strengths being identified by early on, teachers, parents, peers, and then later on in life, obviously employers as well and line managers and managers within the world of business. So yeah, long way of going about answering the question, but as you can see, really, really interested and really excited for the potential that sort of exists and that the power, that understanding all that and applying it to emotional intelligence, it all very much comes together.

Paul Heming: No, I can see, and first, I appreciate your honesty in just telling us about your story. There’s a lot to think about and unpack there, which probably can’t do in one half of a podcast. Can we? But really, really appreciate you explaining that. I guess you’ve always been very attuned to your emotions, to your mental health and even more. So now, it seems naturally it’s an ever progressing metric almost is the right way of putting it. How has having that emotional intelligence, that understanding of yourself, which grows day on day, how have you used it as a superpower to get to where you are today in the context of construction? But you talk about like, you can have arguments day in, day out, hour in, hour out if you really want to as a QS, right? I’m not saying that everyone does or everyone should, but that is the way the world is of our space. So how have you used your emotional intelligence to navigate difficult commercial issues?

Dan Macpherson: I think for me, especially acting primarily in that EA, CAs or PM function, I’ve always believed that you can get the most out of people in life. And that’s both in professional life and the personal life. When you are able to able to get on with those people and work with them rather than adopting a kind of a hierarchical kind of conflict type approach. And that has never failed me. We’ve had really, really successful project outcomes throughout my career by getting on with people and getting people to be put in the same direction. And when it comes to difficult conversations, you’re more likely to get a yes from someone if you get on with them than if you don’t get on with them, you’re much more likely to get a no, if you’re acting as like a bit of an ass or they’re acting as a bit of an ass. And don’t get me wrong, there are people, you do come across, there’s some very, very difficult people in the world generally, not just in construction. We’re not special. And so it’s something that I think I’ve always enjoyed and always had those sort of innate abilities, I suppose. And hence why I enjoyed acting in that EA capacity from only a couple of years into my QS career during the time I was undertaking my degree. So I think in a nutshell, that’s how I’ve deployed the use of emotional intelligence on a project level.

Paul Heming: Relationship management, building those relationships, getting on with the people. I have to say, it sounds like we have both got quite similar approaches to project commercial management, however you want to do it. Because like at the heart of what I always try to achieve on any project that I was involved with was get your ducks in a row and do all of the right things on a project so that if the worst happens, you are ready. But more importantly, make sure that whoever the key stakeholders on your project are, you’ve got a very good relationship with them, you know about their lives, you know what makes them tick, you know what matters to them and you’ve built that relationship with them. It doesn’t come naturally to some people. I’m not saying that it comes overtly naturally to me, right? But if you are, I’m mindful of the time, and we’re almost at, we’re probably past the first half here, but I’m enjoying this. If you are mentoring lots of people, there’s people listening to this show who might be thinking, yeah, but how do you apply any of this? Like, it might feel a bit abstract. If you were speaking to one of your mentees today or someone listening to the show, how would you advise them to be more emotionally intelligent?

Dan Macpherson: So one of the things I’m a big advocate of and then people who have consequently picked it up, who are in my team, one-to-ones communication. There’s so much value to be had from one-to-ones, and it doesn’t need to be formal. I like to make it formal because I like to put aside time for people so that there’s no distractions, there’s no day-to-day and you are deliberately blocking out annual calendar to be able to spend time with those people. I don’t do on teams, I like to do in person because again, a lot of emotional intelligence comes with being able to read people. And I don’t know what the percentage is, you’ve probably heard it before, but 80% of communication comes through body language. I’m a big gesticulator you probably see on the screen right now, but, yeah, so be in person and I think going off piece very slightly, but one of the advantages of kind of hybrid working, bit of working from home, a bit of in the office, if your role enabled you to do that is that you can’t read people as well when they’re behind a screen. In person you can really have those sort of chats at thet station. The chat’s just popping your head over their desk or bumping into each other in the corridor, whatever it might be. And you can learn so much from being with people in person. So there’s definitely a win there for working in the office or on site.

Paul Heming: I have to say actually that one-to-ones, something that I have in the last six months, kind of like built into my repertoire with the team that I’m managing. And you do it, I do it every four weeks. Some people do it every, I know my girlfriend, she does it every two weeks with her boss and this is sad, but we were having a pint over the weekend and I was chatting to her about it. I’ll say, God one-to-ones are absolutely amazing, actually completely transformed my relationship with my team in terms of the regularity of the conversation. You can actually talk quite openly and honestly in that conversation both ways, right? And in doing that you can actually really start to map out a direction. I’ve been doing it for six months with my team and you can just see slow progression in, a, the relationship and b, what you’re both trying to get out of it. It’s good for them, it’s good for me and that completely echoes and I completely agree with you. We are at the end, we’re probably beyond the end of the first half, Dan, but I have enjoyed that and we will talk more in the second half of the show right after this.
Oh, I think I’m going to have to lie down after that first half. That was really something. That’s great man. I really honestly love having these conversations. Love the energy and love everything that you’ve just said. It really, really resonates. One of the things that we discussed, Dan, when we did our pre-show meeting was the market for hiring QSs. You guys, I’m simplifying things by saying you’re a QS business, but QSs are absolutely at the heart of everything you do. Hiring, recruiting QSs is such a big part. I read some recent reports which said that ROCs reports, which said somewhere between, I’m not going to quote the number because I’ll forget it, but somewhere between 50 and 55 and 65% of construction companies who are hiring QSs are finding that there are not enough. They’re struggling to hire QSs and it is holding them back was the result and the findings of that study. I want to talk to you about how you guys do it, but first, what do you make of what I’ve just said? Is that something that resonates with you guys? Are you finding it difficult to hire good people?

Dan Macpherson: So I kind of briefly touched on it earlier, it’s a very hot market out there. I think the chap you had on in, as I say one episode, 124 summed up perfectly is on the cold face of recruitment. But yeah, it’s difficult. It’s challenging. There’s no doubt about it. I think it’s a symptom of perhaps, again, what I’ve mentioned and touched on earlier is that at one point in time, not so long ago, for some, it’ll be a long time ago, but for me it’s time has flown is that there was a period of time where investment in skills and apprenticeships didn’t seem to be there, especially as a young person in school and in sixth form, the message was go to university, not go into construction, and these are your options. And that message has definitely changed at government level, I think in the last sort of, should I say, four to five years. And so we’ve taken a long term view for a number of years now whereby we’ll kind of go into six form colleges. And so when I left my sixth form college, we’ve now been back into that six form nearly every year to go…

Paul Heming: And you talk QSs.

Dan Macpherson: About construction.

Paul Heming: They go, excuse me. I survey quantities, get out of my site. That is not cool enough for me.

Dan Macpherson: Exactly that, but you can touch on project management as well, but yes, it’s effectively telling the students there that there are more options available to you. This is what the world of construction looks like. It is diverse, it’s a complete variety of sectors, projects, people, skill sets, and we’ve been very, very successful in that approach. So I started out going back there and more recently it’s one of my colleagues who actually went into to give a presentation to 250 teachers at the same sixth form college. She’s 19 years old. She came from the same sixth form college that I went to. And she’s educating teachers on what quantity surveying and project management, the world of construction looks like. And we’ve had a great deal of interest and success from that approach. And so if you imagine, you kind of take on a couple of apprentices every year as an office. This is not just as a company as a whole, this is just an example using the Cambridge office that I work from. You can take that and then after 2, 3, 4 years, you’ve then got people who are aligned to the company values and the culture. You’ve been able to mentor them and nurture them. And it’s been fantastic. And that’s been such an enjoyable part of my career, more laterally. I spoke on a midpoint through my career and onwards is again, mentoring, coaching and being with people, working with people. So that’s kind of the approach we’ve taken there. We’ve got an internal recruitment consultant that is doing a fantastic job and one of our approaches is, again, touching on the people and culture piece. And that is so important. We’ve got really high levels of staff retention and that comes, I’m sure, I have no doubt I can talk from personal experience given that I’ve been at the company from…

Paul Heming: Yeah.

Dan Macpherson: From being an apprentice is that it does really mean so much working for an organization that has a true and genuine focus on its people and the culture of the organization. And it’s not just implementing what you think is right and then just sitting on it and not progressing. It’s an ever evolving thing. And that is to be a part of an organization that is constantly trying to push forward and always looking for new initiatives, new ways of working. And one of our kind of strap lines is doing the right thing as an organization. And you can apply that phrase in so many situations and it’s amazing how powerful, it’s just do the right thing. What’s the right thing to do in that situation? And so that’s very much been or and is our approach at the moment, but it’s certainly tough.

Paul Heming: And do you feel, I mean you’ve described it quite a lot from the younger entry level quantity surveyors and guiding them through that entire process sounds like it’s a journey that you went on yourself. Well it is, isn’t it? So it’s at the heart of how you feel about the organization. When you are hiring, how do you try to stand out from or not how do you try to stand out from your competitors, how do you know that you guys stand out from your competitors?

Dan Macpherson: I think it’s difficult to articulate when you’ve not worked for an organization, you are in an interview situation, you’re perhaps taking what people are saying from that organization on face value. So it is sometimes difficult to articulate the value of the people and the culture within the organization. But let’s say there are internal recruitment consultants doing a fantastic job of advertising all the things that we stand for, all the benefits of working for Henry Riley. And I think that’s all you kind of, I suppose that’s all you can do. You’ve just got to try and convey the message of what you’re about as clearly as possible to make yourself stand out from the crowd. And very much post COVID era things like hybrid working and flexible working. And it’s so important for us, so many people, not every organization is able to adopt certain policies because of what they do, where they’re located, what industry they’re in, but certainly being consultancy side in the construction industry, that opportunity is available to us and something that we will continually review to make sure and try and ensure we’re always doing the right thing.

Paul Heming: And as an organization, I’m sure you’ve listened to all of these, but we’ve talked on this show about the evolving role of the quantity surveyor with tech that’s coming in, as there’s interesting to put that to the test for a company where the role of the quantity surveyor is at the heart of what you sell and what you do. How are you guys preparing? Are you preparing for like a shifting role for your business?

Dan Macpherson: I think it’s really exciting and again, it’s something that was kind of touched on in a recent episode when you were talking about artificial intelligence and the future of construction. And also a big part of what I do, which I didn’t mention earlier, is again, during COVID with that spare capacity that we all found ourselves having is that I launched…

Paul Heming: Most people were just chilling out by the way. It was just you, it was ramping up.

Dan Macpherson: We launched as an organization, our MMC consultancy service. And so that was a UK first amongst PM and QS firms, which was really proud to have kind of spearheaded that with the experience, particularly in modular that I had CAT1-MMC modular construction, volumetric modular. And when you are as an organization always focused and always looking for the next thing and always trying to keep your finger on the pulse of where things are heading, that’s really exciting because you are with the world of modular, it possesses such great opportunities. I personally and as an organization, we’ve got a team that’s working with me, work very closely with a organization called the Offsite Alliance who are really pulling together, collaborating, whether you are client, consultant, manufacturer of different forms of MMC to push the industry forward. The world is changing. And so when you are looking at the ever evolving role of the QS, when you start to work in that world of modular construction, there’s so many opportunities for different ways of cost management and project management and program management and it’s just a slightly different way of doing things. It’s a step change in the process and a step change in the approach. And so yeah, hopefully that semi answers your question there Paul.

Paul Heming: Yeah. No, you’re future proofing it by looking at different methods of construction, et cetera, et cetera. But talking about MMC, really interesting that you talk about it. And I am no MMC expert, far, far from it. My MMC experience goes as far as, so I worked with unitized curtain walling, I was on project where’s bathroom pods, et cetera, et cetera, but not real volumetric modular construction. This year, 2023 has seen the failure of several MMC organizations, right? So again, no expert but LNG Caledonian, is it ILCA homes as well? What’s your take on those failures?

Dan Macpherson: So, it’s an interesting question because I’m actually 70% of the way through writing a UK MMC report for one of the largest housing associations in the country currently. There’s reasons why there’s been issues there at those organizations and unfortunately they are no longer around to start with the good news message. And I have to do this because the likes of ILCA, and LNG especially have done so much good for the world of MMC, but particularly volumetric modular count one MMC. But some of those issues, which I won’t go into great detail, relate to I suppose single sector, the residential sectors difficult enough to navigate through with the obstacles, particularly in relation to land and planning are two really big hurdles. And when you’ve got a factory like ILCA and LNG had, and you’ve got really big overhead, if you’ve not got a full factory, you’ve not got pipeline, you’ve not got commitment, which is really difficult in the residential sector. You’re burning through your overhead on a daily rate very, very quickly if you’ve not got anything running through your factory. Other organizations of which there are many, and there’s some great success stories which generally go under the radar. We love a bad news story. The media does that have organically grown, that are multi-sector, that are growing year on year that maybe have higher divisions to plug any gaps in factories, for example that are investing in R and D that are getting the various accreditations such as BO-Pass and the NHBC accepts building warranty in the residential world. And there’s also manufacturers of volumetric modular products that do have pipeline and are very, very steady, very, very strong. And where they’ve got clients and often government departments that are feeding factories, keeping factories busy. So MOD, MOJ, schools, hospitals really geared up. And so if you’ve got that multi-sector approach, that’s brilliant.

Paul Heming: And so, again, like I said, this isn’t something I have ever gone into great depth in understanding, but my base knowledge is that obviously to do volumetric design and supply, you have these huge factories set up, you’re spending a lot of money, the fixed costs are absolutely gigantic and you just need volume to keep on, churn it out and keep on making it work. Otherwise, if you’re not delivering anything, you’re spending hundreds of thousands of pounds each month for an empty factory or a non-functioning factory. Are you saying that a lot of the problems that those companies experienced were actually due to the fact that planning and other issues were holding them up, which meant that their pipeline dried up?

Dan Macpherson: It certainly is what a factor.

Paul Heming: Really?

Dan Macpherson: There’s no doubt. It’s not that it dried up. It’s that when you are trying to pencil in your factory slots and plan ahead as best you can, and a sure thing, planning application turns out not to be a sure thing. You can have hundreds and hundreds of modules, hundreds of houses, apartments, residential dwellings that then aren’t in your factory. And there’s some great, great things being done by lots of different organizations and lots of groups of people. Again, the offsite alliance being one of them who are have the ear of government, there’s make modular who again go into 10 Downing Street. And just from a manufacturer’s perspective, we’re able to convey what the needs are for the industry to thrive. And as said earlier, there’s such great potential that exists with modular. You step back from the failings and the issues and the obstacles. If you step back and you take someone like housing or apartments or prisons or MOD housing and barracks, it just makes sense to deliver something in a standardized way. Not all eggs in one basket with one manufacturer. And this, you might have heard that the term platforms, platforms are something that have, again, such great potential. But all I mean by that really is that you’ve got different manufacturers that can all agree to, yes, have different specifications, but all those, a different module for one manufacturer will connect with a module from another manufacturer. And that’s a really over simplistic way of describing it, which then can overcome some of those perceived risks and actual risks when you’re talking about manufacturer and contractual insolvency. Because if one goes belly up, you’ve got someone who can step in. Again, payment mechanisms, the contractual amendments that you can explore and adopt to really leverage…

Paul Heming: Oh, don’t get me started.

Dan Macpherson: The benefits of modular. Oh, I could go on all day.

Paul Heming: But tell me, I know that you are 70% through writing this piece. By the time this comes out, you’ll probably be a hundred percent right. But where are we with MMC? What’s your view?

Dan Macpherson: In some sectors progressed, in others, particularly the residential sector, there’s still work to do. The biggest challenge is aggregating demand. And what I mean by that is getting that demand across, for example, housing associations, which homes England have been doing a great job at trying to do and do. But without that assurance and confidence in getting full factories, it’s going to take some time.

Paul Heming: So just jumping in there. So my understanding then is the DOJ, if you’re talking about prisons, if you’re talking about barracks, you’re even talking about schools, right? The government can say, I want to build hundreds of these or X, Y, and Z. So you can build that, you can get that certainty in pipeline. But with housing where it’s much more fractured in terms of who wants to deliver them, it’s more difficult. Is that right?

Dan Macpherson: Absolutely. It’s difficult to get clients and organizations who are delivering these schemes to commit to pipeline. It’s very difficult, but you don’t have to commit necessarily to pipeline. But it’s about having that agreement between organizations that if for example, you’re delivering retirement living or extra care assisted living which is something we deliver a lot of, and I’ll use that as the example. You’ve got one bed and a two bed apartment type that from provider to provider of an affordable kind of product won’t differ too much and so…

Paul Heming: Shouldn’t differ too much, right?

Dan Macpherson: Yeah. They won’t do, the layouts will be more or less identical. The specification might vary, but you’re talking really finishes. So the actual box can be the same from provider to provider, the internal specification that can be agreed from scheme to scheme. But if you can get to a point where you’ve got different providers that understand the strategic decision making that I think is required or I know that is required to go down that modular route, you can leverage so much potential in modular and solve so many problems. I mean talking about the skill shortage earlier on, you want got a massively aging workforce, third of the walk workforce or over 50 as an example. So if you’ve got a nice warm factory where you’ve got a nice canteen area, there’s not the mud, there’s not the cold, you are encouraging people to stay in the industry for longer. You’ve got then the opportunity at the other end of the spectrum. If you are an apprentice looking at the world of construction, you don’t just have to be looking at performing one role or one trade. You could have multiple skills. Not only that, you can then perhaps go into programming or the world of design and engineering and supply chain, procurement, commercials. There’s so many opportunities that exist because you’re under one roof. And again, the kind of the, I very much think of modular particularly, it solves the E and the S, the ESG, environmental, social governments. There’s so many benefits that precision engineering reduce waste from an environmental perspective, better generally inherent quality because of those conditions you’re working in. But from a social perspective, again, I remember one of the more recent episodes I’ve listened to, I think it was lady called Michelle on, within the last kind of five or six episodes. She was a woman that in construction had worked contract aside and the poor behavior that she’d experienced in her career. If you take that and you put it into an MMC sort of modular factory environment, the management should or has the ability to be much better. The potential for poor behavior is limited. Things like going back to motion intelligence, again, you’ve got people that are coming in and out of that factory every day, whether office based or factory floor based. And you can have that one-to-one interaction with people to make sure they’re okay. Ask the question, how are you today? And so that addresses potentially the issue we’re seeing with two people every day try and take their life. So there’s all sorts of issues to go at that can be addressed by modular.

Paul Heming: And so this is in the context of what you have just said. This is probably a stupid final question Dan, but do you believe in a future of MMC?

Dan Macpherson: 100%, no doubt in my mind, the key to success is the right team all pushing in the same direction who understand that step changing process and approach. And it’s got such potential and it just solves so many issues. And I talk about MMC more broadly as well in that because AI and robots and things are on that MMC spectrum as defined by the MMC definition framework. Absolutely no doubt in my mind and thinking ahead to the horrible situation in Ukraine at the moment, hopefully that conflict comes to an end as soon as possible. There will be the need to rebuild the country. And if you can train people maybe Ukrainians in the world of modular construction, because that’s where we’re going to see the fastest sort of at pace rebuild potential for things like accommodation. Let’s use again, apartments and housing as an example. You can start the process of rebuilding outside of Ukraine. You can build the modules, the homes, you can train people now with a view to them to going in and rebuilding when that conflict comes to an end. So for lots of different reasons, again, from the ESG perspective, there’s so much great potential that exists there and gives, in that instance, people, their homes back as quickly as possible. But good quality accommodation and homes, them to go back and live in.

Paul Heming: That is a really hopeful and optimistic way for us to end this thoroughly enjoyable conversation. Dan, I mean, we have covered a breadth of topics in the time that we’ve been talking. I feel like we could talk a lot more and perhaps in the future we will. But look, I will share Dan’s details, Henry Riley’s details in the show notes. And Dan, thank you for, like I said at the start in the first half of your honesty, but also for bringing your emotional intelligence to this conversation. I’ve really enjoyed it and I’m absolute certain everyone listening has too.

Dan Macpherson: Fantastic. Thank you very much Paul.

Paul Heming: Absolute pleasure. And guys, as always, I will speak to you next week. Have a great week end. Cheers.