In Part 3 of Labor in the Era of ConTech, we learned that ConTech has presented us with an incredible opportunity to make our construction organizations more efficient and sustainable. The organizational approach towards vertical-integration allows for our industry to not only capture lost costs, but also innovate and build faster.
Where ConTech hasn’t yet succeeded is in the area of human capital, or investment into the people that make building possible, through workforce development. Even with the solutions that ConTech is proposing and executing on job sites, there is still a misalignment between ConTech’s People Management Regimes and utilization of Skilled Labor.
In Part 4 of this series, we identify some of the initiatives we’ve seen ConTech take to cultivate healthy people management for skilled labor and what the next steps might be to make a real, lasting impact for shareholders, clients and industry partners.
What’s Being Done Well
ConTech firms are just now making their first attempts at developing training programs for their in-house teams. Katerra, for example, is just completing a first round of training that started in June of this year to train 250 skilled tradespeople via two weeks of training on job site and tool safety.
According to Nigeria-based engineer and concrete building industry leader, Jumoke Adegunle of the globally-reaching building materials and solutions firm, Lafarge, recent attempts made by the government may solve the skilled labor shortage there. Hinged on technology, the N-Power Build program was launched in 2018 and is about to commence its third year. The application and selection of participants, as well as performance monitoring and control, is all done online.
According to Adegunle:
The training is a ‘starting from the scratch’ approach to ‘Skill Up’ young graduates and non-graduates across the country addressing unemployment and poverty. The actual skill acquisition is localized at centers in various states around the country with on-the-job training at construction sites under the guidelines of the National Occupational Standards.
But Adegunle warns:
Though the development of skills is crucial, the true test would be how the newly trained artisans can be linked to job sites and their impact on quality and efficiency of projects.
Well, there’s an app for that!
EdTech for Workforce Development?
A handful of software solutions are filling this void. While construction recruitment firms have been around for decades, it’s only been a few years since tech companies have begun to connect users to skilled trades. Faber and iBuild are two examples with some traction bridging the gap to find skilled labor while giving them platforms to “skill up.” These solutions differ in depth, quality and function from home services aggregators like Thumbtack, TaskRabbit, and Home Advisor, which aren’t dedicated to skills development.
The Center for Infrastructure and Society (CIS), which helps innovative construction companies integrate their people management regimes with the traditional labor supply, is quite impressed with the direction that iBuild is taking in emerging markets. Strategically linked to the world’s largest development banks and mass-housing organizations, they have recognized that the “elephant in the room” contributing to the global housing crisis is the inconsistency and overall lack of labor skilling. iBuild wants to create pathways for money, consumers and builders to access quality skilled labor. Like CIS, iBuild recognizes that the global housing crisis will not be solved by philanthropy, but by social entrepreneurship.
Though not socially-driven, Faber seems equally impactful for workforce development, marketing its services to the world’s largest builders. Parker Sloan, an engineer who has been working in regional sales for some of North America’s largest legacy and forward-thinking materials companies including Prosoco, recently stumbled upon Faber at a “net positive” symposium. Though it probably should have, Faber wasn’t attending the conference. While meeting with architects who are beginning to design buildings with the fourth dimension of time in mind, Sloan noticed a large workforce between the ages of 21 and 25 gathering on a commercial construction project across the street from the venue.
Faber banners were hung at the jobsite. After looking into them a bit further, Sloan reports:
Faber seems to be on the cusp of creating a savvy platform for the labor supply and demand marketplace. Getting the mentorship piece right will be key.
Lessons and Suggestions For How We Can do Better
Being the largest of these firms, Katerra gets most of the attention. So when things don’t go well for the company, like their struggle to align with their skilled labor supply, negative headlines, like these, hit the newsstands hard. Top management has seen high turnover over the last year. This now includes co-founder, Fritz Wolff, who stepped down from the board this week.
But Katerra shouldn’t be singled-out for failing to align with the traditional trades. All ConTech firms have venture capital investors pressuring them to grow quickly. Investment in workforce development doesn’t show short-term returns, so human capital, workforce development is always a low priority for these companies.
But it’s the reason they are all struggling to grow. ConTech has reached a point where it needs to integrate construction education and career planning for skilled labor into the growth path of the organizations.
Perhaps, taking a workforce development lesson from another industry could give us a fresh perspective. According to workforce development expert, Hildemir Chacin,
The oil industry is a sector that demands a high level of technical aptitude, therefore it warrants the development of skills of its workers through career planning. In some companies in this sector, the participatory training diagnosis has been implemented without considering the associated budget and strategic objectives. Training plans have also been developed that are not associated with the worker's career in the company, which is why these mechanisms have not been successful.
Additionally, technology has impacted labor relations, forcing companies to adopt measures that guarantee skilled labor will achieve organizational objectives. A focus on human resources becomes essential to connect all the dots. Traditional technical waves of recruitment, selection, employment and staff development must coexist with technological advances that impact the workforce.
Like oil and gas, construction requires a high-level of technical expertise. So, until ConTech begins to shape its companies’ people management around skilled labor, shareholders will continue to be disappointed by performance.
ConTech companies can evolve by:
1. Integrating company workflows into traditional workflows of building tradespeople.
2. Assigning key performance indicators and objectives and key results with clear daily, weekly and monthly targets--something not done in traditional construction, ever--to all aspects of these new workflows.
3. Coaching the skilled labor’s people manager in how to think about creating a proper career path for the role (to make it scalable and retain great talent).
4. Designing creative and constructive on-boarding and training processes for new hires that inculcate skilled laborers into the company culture in a healthy way.
5. Designing a continuing education training curriculum that follows the new hires through their introductory employment period until they “graduate” as official employees or “certified” labor for the company.
6. Leveraging market analyses to build hiring plans.
7.Establishing periodic evaluations that allow the exchange of ideas with workers to improve performance.
To conclude, we recall the “net positive” symposium that Parker Sloan attended where architects are starting to think in the fourth dimension. It’s no longer enough to build net-zero homes, which in theory, eliminate negative impact on the planet. Back in the 70s, we called this “sustainability.”
That was 50 years ago. It’s time to evolve. Our industry, our planet and our people want “positive” impact, “regenerative” impact. Curious about learning more? Contact your local Regenerative Housing expert today.