The BESA Podcast with David Frise and Mark Farmer

Today’s guest is Mark Farmer whose founding director and CEO of Cast Consultancy.

It’s four years on since the publication of ‘modernise or die’ which was a seminal publication on construction and how it needs to change and change rapidly.

We talked about that change and what worked what hadn't and what further changes are needed in the wake of Grenfell and the pandemic and then we talked about net zero the building Safety Act implications the role of clients. 

Fascinating about his early career 26 years in one with one employer and then gave it all up to start again five years ago really interesting guy I hope you enjoy it. 

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Transcript

DF: Hello and welcome to the BESA podcast our guest today is Mark Farmer who qualified as a quantity surveyor started at EC Harris and spent 26 years there rising to group head of residential. Five years ago he set out on his own to form Cast Consultancy and in his first year there, perhaps the thing he is most famous, is his publication or report ‘Modernise or Die’ that was the last major report really on the construction sector. Good afternoon Mark

MF: Hi David 

DF: And welcome, it’s 4 years since the publication of ‘Modernise or Die’ where are we on that path of modernisation do you think? 

MF: Yeah it's an interesting question isn't it, I think we're on that path I suppose in some ways this is not a start finish at question it's not it's not an exercise that starts somewhere and finishes somewhere to continuum and you know when I set out to publish modernise or die it was about trying to instigate a bit of change in the industry by people just sitting up and realizing the nature some of the challenges that we had ahead and I think to varying degrees is done that I think is promoted to debate and that was really part of what I wanted to do I wanted to get people's awareness up I wanted people to debate the issues because the debate and the discussion then leads to change you can't have change out of the ether you have to actually start by having grown up discussion as to what the hell is going on what what are the issues in our industry and how we going to solve them and I sensed that debate has been pretty healthy over the last few years and actually you know if you look back at my recommendations and what I was asking for I was effectively calling for what I called a tripartite government the government clients of the industry and industry itself to come together in a much more aligned way to try and resolve some of the industry's woes and you know if you look at what's happened over the last few years probably the bit that's seen the most progress is the government side of that so there's been a whole swathe of different things happening which no doubt will talk about in in in this session, over the last four years which have really helped I think just try and get the government aspects around policy enabling policy going the government as a client thinking differently perhaps that the bit I think still work in progress is really where is the industry in his own uptake of wanting to do things differently and indeed what role declines really think they have in and they bring that change I I'm pretty clear that we're not you know we're definitely still on that journey and there's significant progress still to be made but it the debates being had and discussions being had which is good.

DF: What impact do you think the pandemic has had on this debate as it does it turbocharged or is it slowed it down do you feel?

MF: Well I think it's a double edged sword in some ways I think the some of the drivers for change that I spoke about in in modernise or die in terms of the fragility of the industry is dependency on site labour intensity is one of my key themes is just this whole thing about why do we insist on doing everything at the final work face that's clearly been shown to be a bit of an Achilles heel during the pandemic and you know as the industry's learn to operate under the new guidelines and CLC and Build UK have done some fantastic work this year to set out what you know the COVID 19 secure environment looks like for a construction site it's clear that has an impact on the ability of a labour force on site to be working closer together you know social distance he has as a real physical impact so I think it's definitely got people thinking its accelerated thinking around off site manufacturing and modern methods of construction and some of the ways in which she might reduce site labour intensity and you know that's been really interesting would be a businesses that wouldn't necessarily engage with that debate I think have been forced to because they have risks around their production they have risks around their contractual liabilities and they're actually deciding to have that discussion about doing things differently on the converse today I think obviously the whole economic output from this in terms of implications on workload on economic confidence on clients that the industry commissioning construction work in the future is bought fragility into play which you know let's be honest you know when it comes to changing ways of working and investing in R&D or doings things differently that's one of the first things that gets knocked on the head so you probably have this sort of slight dichotomy between businesses being forced towards change and that those that are actually putting perhaps change at the bottom of their agenda again because it's more about survivalism so I think it's complex and it's complicated and it's very much about individual organisations outlooks but it's had an impact I've got no doubt it's had an impact and I think on balance of probabilities it allowed more of a positive impact than negative one.

DF: is it time for a follow up report you think to say to highlight the bits got right and dare I say did you get some bits wrong? 

MF: I’d absolutely I wouldn't say that my thoughts are 100% perfect it is really as I said meant as a stimulus for debate and some of that is subjective it's personal I had a viewpoint I tried to socialise those viewpoints as part of the process of drafting that report so I had a advisory committee and obviously I was liaising pretty closely with civil servants in both abys and MHCLG along the way so you know if I was honest I could have been a bit more controversial and controversies no there's no harm in that I don't think in terms of provoking the debate it doesn't mean you're right or wrong it's just again getting people to talk about it and react but in terms of a follow up reports not on my radar at the moment I'm pretty busy with the day job in terms of running my own business and actually you know with other things I'm doing in terms of advising they helping to advise government on various matters or an MMC yeah that's pretty much right in front of being in the moment that's my focus attention is there a point in the future where perhaps I reflect and look back and I chart progress who knows that you know there if that's something that's going to add value then perhaps I'll have a look at it I'm not in the business of writing reports for the sake of it though so it's it needs to have a purpose really.

DF: indeed, I'd like to take you back if I may, as you've had a career spanning more than 30 years and the beauty of a podcast is that they can't see that you have aged at all in that time. What drew you construction in the 1st place and why a QS? 

MF: Yes, so, I get asked that quite a lot actually, and yeah, I think the whole thing about construction is a familiar story it's one of these things we talk about a lot in terms of where does the industry get its impetus from for new talent coming in and it's actually if you strip it back a lot of it is down to family ties some link with the immediate family of someone who's in the industry and perhaps shares experiences or you know entices another member of their family into it that's what happened with me so why my dad was a stonemason he trains you know the very traditional way he was he didn't apprenticeship that spanned working in the quarries in Portland through to working with marble in Corolla in Italy through to working in restoration work after the war did a lot of war damage work on lights of Saint Paul's Cathedral in the likeand then into general contracting and high end stone marble and granite finishes and in back in the day you know when I was a youngster he used to take me on to construction sites before health and safety was present as it was now but it got me interested got interested in construction because actually yeah he was passionate about everything he did you know laid was laid out in front of everyone as being his CV and he used to go around London pointing out jobs he'd worked on you know going back right 1950s and 60s and I just like that I like the idea of every job is different you know you could make your mark on the world and it was tangible as opposed to just being you know a spreadsheet with some numbers at the QS bit you know I'll be honest I oscillated when I was doing my a-levels as to whether I wanted to be a civil engineer or to work in surveying on the more commercial side and on for some reason right at the last knockings I decided that being closer to the money would not be a bad thing in terms of getting close to decision making and making things happen and that's probably not the wrong decision at that point albeit slight regret that I did the engineering side of things which I was but you know I was pretty interested in maths and physics and stuff like that at school I wasn't able to actually take that forward in the depth that perhaps engineering would offer but no regrets you know I made my decision I had a great career and surveying has given me some really interesting insights good and bad into what happens in industry. 

DF: So you're sure it wasn't your dad just saying if you want to be in construction son then QS is the only way to go coz they only ones who make any money out of this?

MF: There's no my dad wouldn't have said that actually he if I'd ask my dad he would probably said the opposite he would have said you know do something that is actually using your mind to design or create as opposed to looking after the numbers but yeah i know it was a personal choice. 

DF: So then you join EC Harris that must have been for 26 years that must have that was the sort of bedrock of your career? 

MF: it was a fantastic 26 years right you know I have to say I joined as a year out student so I was doing a sandwich degree and you know my first jobs were yeah it's fascinating I think my very first big job was the Channel Tunnel rolling and when it was still being constructed by CML which is the  consortia contractors that came together to back in 1989 I was working on some other the Folkestone terminal construction so it major civil engineering works you know I was 20 years old exposed to this multi-billion pound civil engineering projects fascinating insights to you know the that the upper end of the scale if you like in terms of what goes on and then went back to Uni graduated went back to EC Harris which was a fantastic career I managed to work in most sectors you mention from civil engineering's I've just said through to commercial property public sector work and then latterly got more and more involved in residential construction made my way up the food chain to got made associate then partner then for equity partner and ended up looking after residential for with wider EC Harris Group and at that that international experience was also fantastic so to work with colleagues all over Europe in Asia, Middle East you know was brilliant and you know I look back on those days fondly.

DF: Yeah, and so you know you could say you could have seen your career out there presumably well it takes a brave man to say actually you know what I'm going to go out on my own what was the motivation for that?

MF: It was a really difficult decision in some ways but in other ways it was an easy decision I think the fact that I'd been in one place for so long there was that element of you know have I really tried everything have I pushed myself and things that perhaps I should have done have I seen other experiences running a business so being an equity partner EC Harris you are you owned a big business but it doesn't it's not the same you know as close to things as if you know you were sole principle or small business start-up and I couldn't see myself working for one of our competitors I couldn't see myself jumping ship and go into one of the other big names in that in that project management surveying field so you only really left setting up my own business is being on the agenda and I got talking to one or two other guys who also we will independently thinking the same and we just happened to coalesce and you know that was the genesis to cast so long side couple of other partners at EC Harris we decided that staying up all our business would be the right thing and we boldly ventured off into the unknown the you know that you never quite sure how it's going to work out but we've been very lucky over the last five years we've managed to establish a decent business we’re 80 strong now starting from seven or eight people that first day we’ve got some great clients and we were constantly interesting stuff so I've got no regrets, it’s the right thing to do. 

DF: How is the role changed in those 30 odd years to think from where you set off as a graduate to now, how do you think the role of QS consultant has developed?

MF: But I think you know there's some there's some obvious things that with the role of technology is as you'd expect is it is a key change agent so when I first set out in 1980-89 we were measuring everything manually it was literally a scale rule and a die line drawing and you know it was physical quantity or you know it is all about bills or quantities it was about at standard method of measurement and it was about cutting shuffle it was about fletcher more and some of your listeners may remember all of this others will probably think I'm talking in a foreign language but it is a very physical labour intensive process and the surveying of today's much more able to call on automation and technology to short circuit about that stuff but I think one of the things that I don't think has changed as much as I was hoping it shouldn't partly links back to my wider sort of evangelism if you like change in the sector is the sort of player sits at the heart of that commercial transaction whether it's between the client and the contractor or contractor and the subcontractor and so many problems in our industry about transactions there about people arguing over money they argued over contracts arguing overpayment and you know the QS is right at the heart of that and and there is you know I'm hopeful that the role of the QS will be less about arguing and tension and negative aspects of that process and more into adding value and you know delivering professional skills and expertise in a different way and a much more positive way I've seen too much disruption and arguments and ultimately disputes including formal disputes whether it be arbitration or litigation not seeing too much of that over the years to really sit back and say is that you know like that can't be that can't be right you know the amount of waste that's going on it must be a better way of doing and administering and incentivising collaborative working and more integrated working and that that the surveyor has a finger key role in in making that happen alongside the role of technology and that's the bit that had perhaps hasn't changed as much as I thought if I look back and why was doing in 1989 administering JC T80 contracts again for those viewers who remember that some other things that my guys and girls are doing now in terms of that whole contractual administration and you know the adversarial nature sometimes at how that all pans out in reality hasn't moved on as much as it should have done we need to address that as an industry we are going to be serious about changing.

DF: Sure so I'd like to actually bring us right up to date and just go through a few things so you're heavily slanted to the residential market and at the moment there's a bit of a boom in mortgage lending home transactions market but that seems to be counter intuitive we discussed this really uncertain times so do you think it shows that indicates the resiliency of the residential market do you agree with that view or is there something else at play here?

MF: I think I think it's the latter id know if you think about the drivers as to why the housing market is holding up but is so bullish at the moment it's not just about it's not natural supply and demand you've got artificial drivers in there which include the lights the stamp duty holiday the chancellor has initiated and the you're seeing the near term end of the help to buy incentive as well for house builders both of those things combined have created a bit of a rush to get on the housing ladder or to move or to transact and to make sure that you get the benefit of both of those incentives or one one or other of them and I think that's created this sort of little bit of an artificial boom I think if you strip that back the underlying housing market is a bit more fragile I don't think it's there's any sort of big car crash coming or anything like that but it's certainly not the bull market that you've seen over the last few months I think that you know something some of this is going to perhaps calmed down after the first quarter of this year I think the true market will start to show itself in Q2 probably Q3 terms of what the longer term trends are you know what's the impact to job people losing their jobs job security economic confidence mortgage lending all of those things are really important I think you also see perhaps the beginning of summer changes in trends as to what people want to live in you know do they want to live in in apartments versus houses do they want to live in city centres versus suburban living I think the pandemic will start to influence some of those trends perhaps in a way that we probably haven't seen in the last few weeks and months cause the transactions are a legacy of probably stuff goes back to pre-Covid is to be honest so but it's just to see how the latter part of 2021 pans out because that's when I think you'll see the true shape and housing market 

DF: And I guess over the years how long lasting those trends are so everybody wants a big house in the country at the moment, once they live in the country for a few years they may be hankering after the city again? who knows 

MF: Yeah, we tend to behave a bit like lemmings I supposed to an extent we you have a trend in the follow it and you know these trends they have some of them have shelf lives so you see things that were in Vogue and then it goes off after a while when people with her or need it modifies and that you know it's interesting thing about built environment it generally is not just housing but in commercial trends you're seeing massive seismic shifts in commercial property in retail property in particular and this is for people to wrestle with these really really big issues and what does it mean about what we should be building and where in the future because if you don't build the right things in the right places then you're going to have a whole load of waste and you know why don't be white elephants for the future none of us want that so I think understanding the big society change and what the drivers are for new built environment assets is going to be really important.

DF: I don't know if you had a chance to look at the barking fire report last week that came out but that underlined some real dog's breakfast of ownership and responsibility and it wasn't clear who was owned it or who was responsible and so kind of it is a try think of all the built environment but but particularly housing how do we square this circle of planning reform house prices and housing quality how do we square that circle?

MF: Yeah what is it you know it's a really difficult one to resolve holistically part of the issue is thinking holistically when you have so in some instances policy is not entirely aligned and you know that's just happened overtime you got different aspects different elements of policy that they back to various points when you know if you now bring it all together you've got things actually act against one thing or another and there is this tension whatever way you cut it there's a tension between house prices and particularly land values I'd say because his land values that really driving house prices it's not construction costs and the idea of housing quality as you say in relation to what people will expect and want of new build homes versus the wider planning environment and clearly if you take the planning environment as a planning white paper the this being issued by government their ambition is to obviously deregulate you know that's the reality if you strip it back it's about making the planning system easier and to actually modernise it digitalise it in many respects you make it align to pattern books and design codes more than you know I'm trying to create more of a rules based system like you see in the states perhaps compared to the very political nature of planning that we have in the UK at the moment but you know is that going to solve the issues around house prices it's not a lot of people think if you sort the planning system out that will increase supply and you'll reduce house prices I don't think that link is proven in reality but there's a bit of a misconception there and reality is planning if you if you ease up planning you don't necessarily get the a greater velocity of output you'll get you know the mechanism of delivery whether it's house builders or whoever that you won't get anyone flooding the market with products that's going to impact their own sales values so there's a sort of unless you regulate for that and you have some kind of intervention into the land market in terms of how land values are assessed or the claw back on for the public sector and planning uplift then you'll never really I think the planning quality issue is obviously you know it complex lot of people you know the whole planning debate at the moment is being led by this the building beautiful idea building better to build useful which is quite subjective in many respects but we also have big issues and on the ground what does that mean what does it mean around space standards what does it mean about daylighting or does it mean on heating and air quality or does it mean around amenity and public space and there's still attention there that that hasn't quite yet been resolved and it you know as long as house builders and developers can make money doing things the way that they are doing at the moment and there's no regulatory regime to change that then it's difficult to see how some of those things are going to get positively impacted so I know I'm a realist at the end of the day you want some of these things change is only two ways is going to come one is government intervention and the other is the market voting with his feet and either of those is possible but you know in the short supply market where you don't have enough homes being built you could argue that the role of the customer in trying to drive change is more difficult because they haven't got a lot of choice but you know who knows I'm hopeful that we're going to see some disruptors come into the sector with new ideas and that's going to put a bit of pressure on somebody incumbents to raise their game.

DF: You mentioned in an article recently about trust, trust is about delivering promises and how important trust is I mean anybody who's listening to the Grenfell inquiry will be say how on earth do we rebuild trust in an industry that's just being shoved through the wringer hasn't it in effect over this. What do we need to do to get that trust back?

MF: We've got to do things better if you boil it back it is about actually you know too much of the loss of trust that we've experienced as an industry has been down to the fact that people we say things and then we do something else and I know this is not casting aspersions at any particular part of our industry I think we will we're all in it together we all own this is an outcome from clients of the industry through to people manage your buildings this is a wider issue here of multiple stakeholders when they all put together in the Grenfell inquiry is highlighted this pretty tragically we're not doing what we should be doing and what we say we do and it's about actually delivering on what you say you're going to do but not only that but in the case of construction particular home building delivering better so actually what we offer is not good enough in many respects I think we have to raise our game in terms of the quality of what we deliver the whole aftercare customer experience has to change you know for something that is the biggest consumer durable you can ever imagine you know a lot of people talk about buying a car or something like that as being a big investment buying a house is multiples of that but you don't have the same level of consumer comfort and redress that you do when you're buying a car and that has to change I think you know ultimately the consumers are increasingly pushing back and saying it's not good enough and you know what I sensed there was a real risk accelerated to an extent Grenfell but I think in many ways it was happening already that sort of empowerment of the public in in pushing back and saying enough's enough that isn't good enough and calling out poor quality build or you know unscrupulous developers or poor quality management of buildings that's become very high profile now and use of social media and other ways of publicising that is a big reputational and brand risk now for many of the players in the market and I think they realised that you even if they weren't thinking about it before they got to now think about raising their game and doing things better and trust is at the heart of it you know you've got to build your brand, brand is about building a consumer trust relationship and you see that in some of the biggest brands out there whether it's you know Apple or Dyson or McDonald's whatever it is there's a big brand that's associated with something this is behind it which people know what they're gonna get whatever that is and then you know it's different brand positioning you don't have that in home building and construction you know it seems to me it is no real alignment to consumers going back and saying I'm gonna build I'm going to buy or rent another XY and Z home you don't get that is mostly driven by location no one's really thinking about the brand and that's the opportunity it's a risk but it's also great opportunity if people think differently and build trust then you know massive headroom and I would I would highlight to your listeners one particular area that I think it's really interesting stuff happening at the moment on the other side of the world so I'm on my travels over the last 4-5 years I'll be privileged to meet lots of really interesting people all disrupting the markets in their own countries and one of these persons is guy called David Chandler who is the building commissioner in New South Wales in Australia and David is setting about really roughing a few feathers down under, particularly residential construction and it's all about this trust issue he's really is driving home needs re-establish a trusting relationship between designers contractors suppliers and the end consumer in the residential market is he brought through legislation now there's a whole series of things he's doing around legislative change and he's then going to use technology and digital thinking to try and drive this distrust in terms of if you if you can't be trusted then you won't be able to sell or rent your units at the end of it and that's a really big stick to wield as opposed to carrots that aren't always ways of incentivising people properly I think yeah and he's taking the view that you have to be a bit more muscular and that's what he's doing in Australia and I'm really I'm keeping a close eye on that because I think it's a it's an interesting sort of marker for how you can change behavioural changing in the market

DF: Interestingly, so in the UK I guess the building Safety Act will be a bit of muscle behind that do you are you hopeful that will deliver that behavioural change and clients understanding and feeling their responsibilities the other bit will be on net zero what impact cause we're doing that and net zero at the same time what do you think will be the dominant piece on that?

MF: Yes on your first question you know the building safety bill clearly is laying out a new framework for how we deliver particular complex buildings high rise buildings over 18 metres etc there is a debate as to whether we should really have a twin track industry there was a different strain of building that's 12 metres in 18 metres not wanting to add complexity and regulation into the mix but actually the issues are generic you know they don't stop at 18 metres so there's a broader issue about owning an outcome coming back to the role of duty holders under the legislation getting someone to own the outcomes mostly these the most important thing here but it's too much finger pointing going on and you see that with the Grenfell inquiry at the moment someone needs to own an outcome and be responsible for it and actually realises consequences if something doesn't isn't done well well done done correctly I have to say I'm still nervous slightly slightly sceptical as to how we're going to drive competency I know the competency bit is downstream around secondary legislation and you know having seen the CIC’s report raising the bar you know there's a big challenge here and raising competency in our industry how do we ensure everyone doing their job is qualified to do it and it's competent to do it we you know a lot of my modernise or die now it is about the skills and training needed to move us on and we we're in a pretty unhealthy place at the moment so I'm nervous that you could legislate whole load of stuff and you can set a framework up if you can't implement it because actually you haven’t got the right competences and you have got the right behaviours then yeah without the right sticks going back to how you drive change the you know the it doesn't have its desired effects and I suppose one of my disappointments in the legislation and actually you know going back to the Hackett review and some of the things that that could have been done is perhaps much more focused on technology and the role of the Golden thread driving compliance and assurance and actually forcing people to think differently about how we design and physically build buildings and I think that that could have driven people much more towards MMC see much more about manufacturing thinking and and quality assurance that will actually have happened on your second point about carbon and net zero yeah it's a big this is a big ticket item now you know we've had a few full stones on this in the past where people have talked about 0 carbon and it's gone off the agenda because governments being talked out of it and have been spooked the it's going to impact output or costs or whatever this is not going away now this is a one way ticket 2050 the issue is I'll be going fast enough and you know we clearly in the last a couple of weeks we've had the future home standard consultation responses released by government fixing what they're doing or publishing what they're doing which is positive absolutely positively endorse everything in there again the issue is whether you know you could go a bit faster and it's good to see that actually debility too for local authorities to go in and ahead of building regs and to set exemplars founders it has now been retained in the future home standard you can see individual local authorities wanting to show leadership in that and yeah it's going to drive change as much is the building safety issue I think carbon and safety are two big picture issues which I'm going to have to force change because you won't be able to deliver low carbon safe buildings building the way we've always built I've got no doubt about that so if there's one thing that comes in as an indirect change agent or two things is going to be decarbonization is going to be the building safety agenda just how it's actually managed and the oversight that's given to both of those things is going to be really important so we have a balance of changing our industry modernising skills methods techniques using technology but we also need to make sure that we don't impact on output so we can't make this unachievable but we gotta make it challenging.

DF: So, four years on from ‘modernise or die’ is Mark Farmer optimist or a pessimist about the future?

MF: On balance I'm an optimist David, I think you know clearly is already set out there's lots of work still to do we're not any tipping point I think tipping point is a term that's used a lot and I don't win we're not there yet we could easily revert back to doing things to same old way and we haven't really changed or mass enough to say that we are doing things significantly different to what we've always done but there is some there's enough reasons to be hopeful around those external environmental factors now that are driving the industry in another direction some of that of the industry's own volition realizing that it's got a big problem with skills and resourcing pandemic is accelerating that as we've discussed those other drivers around the consumer and brand the reputational risk are going to get more and more challenging as would regulatory issues around safety and decarbonization so you put all of those things in the mix then there's an element of you know industry making his own mind up to that it has to change of his own volition and accord and that actually an element of where it's got no choice it's going to have to change just to be compliant that you and and that you know 4-5 years on now from when I wrote ’modernise or die’ I think is a good enough backdrop to expect the next five years if you like and I talked about a decade of change to be have to be a positive one and to move the industry into a better place.

DF: Mark Farmer, thank you very much.