Re-engineering the construction supply chain: transferring on-site activity, off-site

Interest in supply chain management theory and practice in UK construction has grown considerably over the past decade. In parallel, a number of other key industry initiatives have also gained momentum. A notable development has been the increasing modularization of the construction process. The theoretical merits of offsite manufacture in construction are well documented and include reported benefits in production, scheduling and quality improvements. However, the impact of modularization on the governance and membership of the construction supply chain are less well-known. In an effort to connect supply chain management theory with modern methods of construction (MMC), the research investigates the potential impact transferring on-site activity, off-site will have on the supply chain. This is a conceptual paper based primarily on a review of supply chain management and MMC literature. Drawing on supply chain management theory and practice, the significance of an increasingly modular-orientated supply chain in construction is explored and evaluated. Secondary data is provided via anecdotal evidence gathered from a number of construction site visits and discussions with a cross-section of industry stakeholders. The adoption of modular construction and subsequent transfer of traditional on-site construction activities off-site is likely to necessitate a reengineering of current construction supply chain management practice. In contrast to the commercially biased supply networks reflective of long-established working practices, off-site modular construction is likely to engender supply chain relationships that are increasingly socially as well as technologically bound and influenced by changes to the power dynamics. The literature highlights many business
related opportunities, however the transfer of traditional construction activities upstream is not without risk. In conclusion, the research provides a conceptual grounding for further investigation of modular construction and the potential impact on the management and structure of construction supply chains.