This blog post shares what we’ve learnt in the thirteen months since the launch of our Modern Methods of Construction (MMC) Category 1 volumetric framework.
A year ago, we launched a procurement route we believed would plug the hole needed for housing associations and local authorities to begin scaling their use of MMC.
It needed to be novel, meeting the needs of manufacturing partners in a nascent market while providing comfort to housing providers, addressing fears of the unknown as well as the greater risks involved in offsite manufacturing.
Our members say we’ve set the bar in terms of the collaboration, process and due diligence. And the model for the MMC Category 1 framework works: direct call off, fixed and transparent prices and a partnership approach to relationships between manufacturers and members with a view to iteratively improving both design and delivery.
This commitment to getting better over time was imperative from the get-go because we knew we wouldn’t get everything right from Day 1. Here are some of the lessons we’ve learnt.
1. Moving from individual sites to an aggregated pipeline
It was always going to be tricky transforming a collection of sites into a long term, visible and aggregated pipeline. Over 1,400 units have been put forward by our members to the three manufacturers on our framework and about two thirds remain live.
Lesson number 1 in moving from a broad range of sites to a narrower funnel of legitimate options was knowing how to prioritise. The huge delays in the development process have meant we prioritise those schemes where the housing provider owns the land in combination with upcoming planning response deadlines.
2. Being upfront about cost
Housing associations and local authorities have historically been guarded about the budget they’re working towards on a scheme – but this is counterproductive on our framework. We know what all the costs are above ground and have an overhead profit and loss approach to unknowns and below ground costs. So, either the manufacturer can deliver at the price needed, or they can’t. A more efficient approach is to be as upfront as possible with budget early doors so the housing association or local authority can either progress the scheme or quickly move on.
On the flipside, manufacturers are still building their experience and understanding of pricing for turnkey services, rather than just the product. So, feedback from housing providers is critical to that maturity occurring as quickly as possible.
3. The importance of operational meetings and factory visits – for both us and members
There is no substitute for physically going and seeing how things work in a factory with your own eyes and checking in honestly about how the relationship with your partner is working. We developed a relationship model right from the start and always share both positive feedback as well as negative rumours in our quarterly operational meetings. This then allows us to be super upfront about sharing feedback on designs and costs, because it benefits everyone to do so. We’re also pulling together dates for factory and site visits throughout the year for interested housing associations.
4. Clients behaving badly
A board member recently joked that as in the Dogs Behaving (Very) Badly TV show, where it’s often not the dogs at all, but the owners who are behind the problem, similarly in our industry, it can sometimes be housing providers, i.e., the clients, that need to change the way they think.
We’ve worked through what, as a client group, we’re after, and constantly remind ourselves it’s not a construction contract, but a manufacturing one. Reframing it this way changes the tempo and encourages our members to be a different, more informed customer. Another way to look at this is attempting to work in partnership to achieve an agreed goal, moving away from the roots of our transactional relationships in the past.
5. Role of the principal contractor
The MMC ecosystem has lots of moving parts and we know that the sector is going to include many more providers who want to provide only their product, without taking on the role of principal contractor delivering turnkey services. This means we need to figure out how best to bridge this space without adding a whole lot more risk to the housing association or local authority. Finding a route to the right contractors who really want to work with manufacturers is key here, and we’ll need to think about how to get the best regional knowledge as well as social value at the local level.
One of our biggest lessons has been the value and comfort gained in learning from others. We hope to keep building the relationships between members through regular catch ups where we share learnings on a site level.
Membership of Building Better is open to any housing association or local authority in England and Wales and provides you access to our Category 1 framework, as well as our Category 2 DPS. If you’re interested in joining, do get in touch.
By Trina Chakravarti, Project Director at Building Better
20 September 2022
Membership of Building Better is open to any housing association or local authority housing provider in England and Wales.
