Building Safety Act Podcasts

David: Hello, I'm David Frise, Chief Executive of BESA. Welcome to Behind The Built Environment and our guest today is Stephen Gill. Welcome Stephen.

Stephen: Morning.

David: Stephen is a leading voice in refrigeration, air conditioning and heat pumps with a career spanning hands on engineering, contracting, design consultancy, policy and international advisory work. He is a past president of the Institute of Refrigeration, founder of World Refrigeration Day and an active mentor and advocate for skills, inclusion and technical excellence across the sector.

In his new role as technical advisor to REFCOM, Stephen brings a rare mix of practical engineering knowledge, governance experience and global perspective. His focus is on helping the industry move beyond basic compliance towards best practice, while preparing contractors and clients for the major technical, regulatory and competence challenges that lie ahead.

Should we start with the first question? We always do, and we get onto the quickfire in a minute, but the first question is, did you choose the career or did the career choose you?

Stephen: That's a good question. I think the career chose me. I think it was a case of I'm naturally curious. I like learning. I always learn, there is always something new to learn, and being adaptive and being willing to change.

I was not good at reading and writing within school, so I finished with, you could say, no qualifications. My father was an engineer and for somebody without written qualifications, engineering was one of the options open to me. So I went into what would be termed an old fashioned heavy engineering company.

It had a foundry, big workshops, milling machines, fantastic. But it was at the time of change. There was something called the TOPS scheme, a government training scheme at the time where you could be retrained to turn in your career.

Computers were coming in. My mum told me computers are going to be the future, you cannot go wrong. So I went along and signed up for a computer course. I went along on the Monday morning to start the course. My name was not on the list.

They said you can come back in another two months or something. Is there anything else? Well, funny enough, there is a course on refrigeration this afternoon. Would you be willing to go along to that? I did not know anything about refrigeration.

So I went along for the interview and the rest is history. The person interviewed me told me I would have a job for life. People always need to eat, people always need to keep cool and it is ever evolving. So I said, that sounds great. So did it choose me or was it by accident? But it suits me very, very well because I like it.

David: Yes, serendipity, that's for sure. We'll talk about the dyslexia a bit hopefully later on in this discussion, but the quickfire bits, which I know you're really looking forward to. Yes, no answers.

Stephen: I can give very long yes, no answers.

David: Yes or no, please. So does the UK still underestimate how strategically important refrigeration and cooling is?

Stephen: Yes.

David: Is the RACHP sector telling a strong enough story to attract the next generation of engineers?

Stephen: No.

David: Are policymakers treating cooling as a critical national infrastructure project yet?

Stephen: No.

David: Is the industry making enough space for neurodiverse talent and different ways of thinking?

Stephen: I'd like to say yes, but I'm going to have to say no.

David: Will the refrigeration transition force contractors to become more professional, not just more compliant?

Stephen: No, it should. No, I'll leave that. No, it will not force them.

David: We discussed in the intro that you've worked across engineering, contracting, policy, standards, international advocacy, pretty much everywhere. When you look at the sector today, what do you think it understands about its own importance? I've always felt it undersold itself, shall we say? What is still underestimated?

Stephen: It totally underestimates. First of all, most of us introduce ourselves by saying, I'm just a refrigeration engineer, I'm just a building services person. That always enters the conversation. We play ourselves down all the time as a sector. We play down the level of skills that we have and the systems thinking that goes into that.

I was at an engineering meeting and I spoke to somebody who described themselves as a rocket scientist. Wow. Another one was from aeronautics. Okay, you design aeroplanes? No, I design the latches that go on the back of the chairs.

A lot of what we consider the high level, big glamorous engineering sectors are often very narrow in scope. Our sector requires a whole range of skills and in depth as well. I think we really play that down. We underestimate the systems thinking, the design, the hands on skills. We do not appreciate ourselves enough.

David: It touches so many areas. It is central to things like net zero, health, food security, data, comfort, resilience, a whole host of areas, but people just kind of neglect it. So how do you think policymakers see beyond the technical niche? And how do we get people to value it more than they do now?

Stephen: It starts with awareness. If people have got a blind spot to it, and policymakers do not see it as a vote winner, then it is hard. We are a hidden industry, hidden in plain sight. Most people have a fridge in their house now. We are in an air conditioned space. It is all around us.

There is nobody knocking on policymakers' doors saying that if this stops, or if this changes, these are ways to reach your goals and get votes as well. We are integral to so many things.

Through the pandemic, our industry kept working. The supermarkets stayed open. Deliveries were still happening. Everybody was talking about nurses, rightly so, but we were hidden. It is difficult to get attention if people are unaware, so we have to start with awareness.

David: It is one of the fastest growing industries in the world, I think, is it not?

Stephen: It is. Air conditioning, I cannot remember the number now, so I'll get this wrong, but it is something like there is one installed every 10 seconds in the world. It is a phenomenal rate.

David: It is everything from maintaining drugs in Africa so they can be effectively used, to modern communication.

Stephen: Modern communication. We would not be able to speak, no phones without data centres. Data centres, which are cold.

David: You are involved a lot in mentoring and supporting emerging voices within the industry. What do you see as the cultural changes that are needed to make the sector more inclusive, confident and open to new talent?

Stephen: It is a good question, but it is challenging because we have to challenge ourselves with that. Certainly in this country, it is fair to say it is predominantly male, white and not young.

Most would describe themselves as being inclusive. We welcome anybody, but we do not realise there is an arrogance to the way we occupy seats. At judging events, I see the same faces and the same judging panels. They are very competent, very good people doing the right thing, but they are occupying the seat for somebody else.

We have to have awareness, almost conscious inclusion. We have to think about who we are excluding by being there. Who is not in the room because of what we are doing? Even though we say anybody can come to our meeting, can they? Will they feel welcome?

We do not see the people we are putting off. It needs a mindset, not just to say we are inclusive, but to be consciously inclusive and really think about who we are excluding by our actions and our positions.

David: I think you use the term arrogance. It is basically laziness on the most part. It is just easier to invite the usual people to do these things.

Stephen: There is that as well. We all take shortcuts. If I'm setting up a judging panel or an interview panel, I'll ring my friends. They are available, we can get them in quickly and they will all do a very good job. But by doing that, who have I missed out? Who am I excluding by taking that shortcut?

David: I attended something in the States a couple of years ago. Geena Davis, the actress, was talking about the need for role models. If people can see themselves in the picture, they can feel there is somebody else who has done it. They are far more likely to do that. I guess it is setting up more role models for young people to see.

Stephen: There is definitely the visibility thing. Role model is a term that is becoming a little abused in that people think to be a role model, you have to be really out there. You have to be glamorous. No, being a role model can just be quietly leading or making space.

It is bringing that visibility and awareness. If you are setting up a panel tomorrow and you want five people, include two more so that they can be seen.

We have just won one with AREA, the Women in Cooling video competition, which we do every year. The judges I put forward were two past winners, two young women who had won the award previously. Other associations had their usual senior people judging. Across Europe, there were only, I think, three women in the judging panels, and most of them were not young.

David: And you'll have to tell the audience what AREA is.

Stephen: AREA is the European association for refrigeration, air conditioning and heat pumps.

David: There is a lot of discussion, not just in refrigeration and air conditioning, but about innovation, digitisation, smart controls, low carbon cooling, heat pumps and new refrigerants. What do you think the industry most needs in terms of practical, unglamorous improvement?

Stephen: I think we need to play to our strengths with the smart stuff and the digital stuff. It is becoming very focused again. I have got a friend who has a smart fridge and it tells you what is in there and what recipes you can do with the contents. It is wonderful. His house is awful in terms of energy consumption.

We are doing smart things in isolation, whereas if we are designing systems, which we do, and installing systems, which we do all day, every day, we would think holistically. It is not smart doing isolated smart. We have to think holistically smart and we are capable of doing that.

Connecting the dots, which we naturally do, understanding that there is a system involved, then we are playing to our strengths again.

David: Some of the papers will tell you that smart fridge is spying on you.

Stephen: I'm sure, yes.

David: Let's move on to REFCOM briefly, which we should say is part of the BESA Group, owned by BESA. You are joining at a really pivotal moment. What do you think the role of REFCOM now needs to be? Is it a compliance body, technical guide, best practice movement, or all three of those things?

Stephen: All three and more, hopefully. The days of being a single thing are long gone. Compliance is obviously essential. Competence is essential to our industry, but not necessarily just to meet compliance.

There is connection, learning and sharing. It has to be a hub as well. It has to be the central point for connecting all these pieces together to meet the targets that it has and its role in the industry, the certification and so on. You are not just one thing and you should not be. You have to be much more.

David: We also look at it as how do you communicate with almost 10,000 businesses? That is never easy. Government is always asking, how can we get this message across? This is an excellent medium to do that because you have an open communication channel anyway.

Stephen: Yes, it is a great network. The days of any association or body being the gatekeeper to knowledge are long gone. In the distant past, I joined associations just so I could get the information they had. Information is widely available now, but it is not always the best information. A lot of it is inaccurate. Being a trusted advisor is an important role.

David: As we always say, it is the stuff you do not know you do not know that gets you. It can be extremely expensive.

Stephen: Yes, just type into AI and you get it. It agrees with me all the time, but it is not necessarily right.

David: Good enough, or close, is probably not the answer.

Stephen: Dangerous.

David: We are heading towards a much steeper HFC phase down in the UK, potentially moving from a 79 percent reduction by 2030 target to a much deeper longer term reduction by 2048. What are the biggest blind spots the industry needs to face before that becomes a reality?

Stephen: Understanding the numbers is really important because it is quite complex. F gas is not one thing. There is a whole range and the environmental impact differs from one to another. Those numbers are complex in themselves.

The blind spot is that we have to realise it is actually coming. There are people that do know and are giving good advice, but not everybody belongs to BESA or an association. There is a lot of bad information and disinformation out there. We have to be aware that this is happening.

We tend to go to conferences and speak to people who are generally in the know or want to know. But there is a huge area of people who do not know, or perhaps do not want to know. That is a real challenge to our industry as a whole.

David: Within BESA, we divide the industry into thirds. One third are completely compliant, they get ahead of regulation, they know what is coming down the line and they are always compliant. One third say, I have no idea why I am being asked this, but I run a compliant company, so I will do it. One third say, sorry, there is a regulation for this? The aim is to drive that third either into the middle, where they become compliant, or out of the industry altogether. Is that something you see within this sector as well?

Stephen: Very much so. I'm not sure about the percentages, but yes, it is very much there and it has been there for a long time. One of the challenges is that we often think we are speaking on behalf of the sector, which we are, but we have to recognise there is also part of the sector that is not listening. So we speak for who we can.

David: A very large proportion of equipment is still on old gases, in effect. How should contractors advise clients about what they should be doing?

Stephen: First of all, think of it as an asset. It could be a car. Treat it exactly the same. Stop getting too tied up in the technicality of it because often the client is not interested in what R number it is.

Explain how much it is going to cost to keep it, the risks involved, its criticality if it fails, replacement costs and availability. Break it down into simple language. You can say, you have this piece of equipment, you will not be able to maintain it anymore, but if it falls over, it is not the end of the world. Or, if it is mission critical, a data centre perhaps, if that falls over, you wipe out your whole company for three weeks.

Identify the risk, put costs to it and explain it in simple language. As with any asset register, from somebody's home to a complex facility, look at the estate, look at the assets, look at where they can be replaced, when and how.

Most people understand, my car has done 200,000 miles, it costs more to do my MOT than it does to buy a new one. Does it make sense to keep it? Put it in those terms.

David: BESA also operates SFG20, and we see very much that asset registers are pretty poor by and large. Frequently, clients do not actually know what they have anyway.

Stephen: They do not. They are often not necessarily interested because their business is doing something else. But if they understand what they have, and if it is explained that it could break down at any point and the parts are no longer available, they will understand the problem.

They still will not look at the asset register, but at least they are aware in very simple language of what is required.

David: The UK will do some changes to F gas regulations. What would you like to see in those changes?

Stephen: Recognising that there is going to be, at least in the short term, a misstep with Europe. I think we all have the same end goals, but in the short to mid term, there might not be alignment in certain aspects of it. That could create issues with things being brought onto our market which would not be available or would not be widely used in Europe.

When we start to bring the two points back together, because we have both got the same end goal, that could create a problem in the future.

David: So, in précis, the answer to that question is not too far divergent from the EU?

Stephen: Yes, I would like to see that.

David: To allow manufacturing to standardise across a bigger market.

Stephen: Manufacturing, skills, everything else. It makes sense to me to be as reasonably close to Europe, certification wise, as possible.

David: You have talked about moving forward in your role as incoming IOR president again, so you are doing your second term. What does moving forward look like for the sector over the next decade?

Stephen: I think I said moving forward together as well. It was a particular message to the IOR membership at the time, but it applies to all the associations and professional bodies I can think of, probably to BESA as well.

We have to move with the times. The days of us being purely a gatekeeper to knowledge have long since gone. I did join the IOR a long time ago so that I could get their technical papers. These are now readily available everywhere. It has all changed.

People still need good advice, but we have to think as an association about what else we can do rather than just say, you can get information from us. There is best practice, compliance, simple networking, exchange of information. We have just launched the Skills Alliance. We are looking at training and bringing people together.

It is helping the industry prepare for now and the future. We cannot stand still. Anything that stands still is going backwards, and we need to adapt and change what we offer, but also align it with what people want and need.

David: We talked very briefly at the beginning about dyslexia and how that had impacted your life and serendipitously led you to that college to do that course. How has it shaped the way you think and solve problems? Is it something you are constantly having to overcome or has it become easier?

Stephen: I never saw it as an issue until recently, strangely enough, when I saw it in somebody else in the last 10 years. We are all different. We are all completely different. I cannot run 100 metres in 10 seconds and you are not surprised at that.

We are all different physically and mentally. My reading skills and writing skills may be different to other people's, but I think some problem solving in different ways is part of the diversity of life. I saw my strengths and weaknesses for what they are, the same as everybody does.

If I had to read something, I knew it was going to be awful, an embarrassment, so I would avoid it. If I knew it was going to be a problem for me, I would mask it and hide it. Do we not all with something?

It was around 10 years ago. I was helping somebody through a mentoring scheme, a young woman who was being fast tracked, very skilled, highly developed and clearly going to be a future leader. She got into middle management and suddenly fell apart. She was not performing.

She confessed to me that she was dyslexic and her new role involved all the report writing and the things that go with middle management, and she was failing badly at this.

I said, do not worry, I am glad you have told me. It is a big company you work for. The best thing is disclosure. Go and see your HR person, explain it, they will put reasonable adjustments in place and it is something we can work together on.

To cut a long story short, she went to HR. They said, you are not suitable for the job. We suggest you either go back or leave.

David: Wow.

Stephen: Luckily, I knew the owner or MD of the company and I phoned him up and said, what is going on here? But it really opened my eyes. Disclosure is not that simple and the reactions are not always the same.

People are busy in their jobs. Managers are busy. What they do not want is somebody coming with their issues, which is another issue that we have got to face and we do not know how to handle. If somebody comes to a manager and says, I am dyslexic, I need this, what do I do? They do not know what to do. It is not part of their training necessarily.

Creating awareness, signposting and pointing people in the right direction matters. When that difficult conversation comes, they do not go, we cannot cope with this. I get such mixed feedback from people who have that difficult conversation. Some companies say, why are you telling us, we have always known you are. The other extreme is, you are not suitable, you had better go. We still get that.

David: And that still happens?

Stephen: That still happens.

David: That is shocking.

Stephen: It is, but it is out there.

David: Young people who want to come into the industry and have a neurodiversity issue or dyslexia, what should they do?

Stephen: I always say be upfront, disclose it as early as you can without making it the headline. It is just part of who you are. You do not put on your CV, I am dyslexic, in bold at the top. It is just part of who you are.

There is more support now in schools, although patchy, but better. Within higher education, there is often support. What happens in higher education and the workplace is quite different. The workplace is very different to the education world.

There is a big wake up call for the person who has been supported through higher education and reasonable adjustments are put in place. Suddenly they go to their new company and have to have that conversation, but the support is not there because it is not the focus of the company.

David: And as an employer, if somebody comes who is neurodivergent, what should they do?

Stephen: First, there should be no knee jerk reaction. They should listen, take it on board and reach out to somebody who can help them. There are lots of agencies out there that can offer support. It is a legal compliance issue to make reasonable adjustments and assess the workplace.

Everybody is different. You do not just say, this person is dyslexic, they had voice recognition, so we will give it to everybody who is dyslexic. Have an individual assessment. Treat the person as an individual because you want to get the best out of all your employees. Find out what will work for that individual, give it to them, and they will shine.

David: World Refrigeration Day. Why did you found World Refrigeration Day and where is it going?

Stephen: Every dinner I ever sat at, or every event when people get together, we always say we are not understood. We are the hidden industry. We have had this conversation even in this conversation. We remain hidden and it is not good for a whole manner of reasons.

In the past, when we needed to raise awareness, we would organise a conference and talk to ourselves, tell each other how important we were, and we would all agree. The idea of World Refrigeration Day was to reach out and challenge ourselves.

It is proving more difficult than I thought because our companies, associations and marketing teams are geared to customers and internally to the industry. We are not generally geared to speaking outside to our next door neighbour, our MP or the person walking in the street with a dog.

World Refrigeration Day is a standalone thing. It is not tied to any association or technology, but it belongs to all of us. It is so that we try and challenge ourselves to speak to the outside world in whatever message matters to whatever audience.

Seven years on, it has evolved. There are those who have understood it and do get into the newspapers, contact their MPs and so on. There are still those having their traditional trade show on the day because it is a celebration. Let them celebrate it because it is worth celebrating, but that was not the intention.

David: So it is for the wider public, not just the industry itself?

Stephen: It is for the wider public. Do my children know? Does my mother know? Are they interested? No. So how do we get that? We have to change our message.

We cannot go and say, here is a picture of a plant room, is it not exciting? Internally, we can, because that is what we do. But we have to completely change our messaging.

With refrigeration, as soon as we start to promote what we do, it is back to hard hats, nuts and bolts. We have to change the messaging about what we do and our role in society.

David: So the outcomes of refrigeration rather than the actual nuts and bolts of it.

Stephen: Absolutely. When I lived in Singapore, I had to do a presentation to a university. It was a trade day or industry day. Different professions went. There was a barrister before me, a doctor, a lawyer and all these things.

Everybody was interested in these high profile jobs because they are glamorous. You were only allowed three slides. My first slide showed all the places in the world I had visited and I said, what do you think I do? Airline pilot? No.

The next slide was people I had helped generally, feeding people, people in hospitals. Saint? No. The third slide, I put my genuine actual wage packet, my payslip, without edits, on the slide. I was earning more than the other professions, as it turned out.

That different messaging was exactly what we do. We travel, we fix things, we help people and very often we get well paid for it. We do not put that message out. We put out, we spend hours on site, and is this dirty compressor not exciting?

David: Both things can be true. Final question, you are king of the industry for the day. What one thing would you change to make it better?

Stephen: Only one thing? A sense of belief in ourselves. We have really got to believe and understand who we are and what we do. There is still this tendency to play ourselves down all the time. We do not really own and feel proud of what we do.

As soon as we get into that meeting, we are the ones who say, well, I am just. I think it would be to ban the word just. I do not mean go out and blow our own trumpet too much, but just own our place in society.

David: Stephen Gill, thank you very much indeed.

Stephen: Thank you.

David: That was Behind The Built Environment podcast. Join us next time for industry discussion and perspective. Do not forget to subscribe to the podcast, like it, review it, and until next time, I'm David Frise and this was Behind The Built Environment.

David
Hello, I'm David Frise, Chief Executive of BESA. Welcome to Behind the Built Environment, the podcast where I delve into the major issues facing our industry through in depth conversations with key industry leaders. Join us as we explore the trends, challenges and innovations shaping the future of the built environment. Today’s guest is Beth West, founder and director of Navigate Advisory and former Chief Executive of East West Railway Company.

Beth has spent her career at the sharp end of major infrastructure, commercial leadership and project delivery. Her background includes project finance, Transport for London, London Underground, Thames Tideway, Balfour Beatty, HS2 and East West Rail. Beth, welcome to the podcast.

Beth
Thank you.

David
Quite a journey it has been. A transport journey, in fact. So we always start the questions piece with some quick fire questions. These require yes or no answers. Never as easy as you think it is going to be. So, number one, can the UK solve more of its infrastructure challenge by making better use of existing assets rather than always building new.

Beth
Yes.

David
Has complexity become a bigger threat to delivery than cost.

Beth
Yes.

David
Is building more always the best answer to growth.

Beth
No.

David
Is upfront capital cost still the best way to judge whether a project is good value.

Beth
No.

David
Is the industry short not only of people to deliver projects, but also of the expertise needed to make better decisions at the start.

Beth
Yes.

David
I think you win the prize for the most affirmative yes or no answers we have had so far. The question we always like to start with is this: did you choose the career or did the career choose you. How did you end up sitting here today in your current role.

Beth
So I'm giving you my politician's answer. It's a little bit of both. I became really interested in infrastructure in particular after the first year of doing my master's. I was in Bologna and we were studying the European Union and how France and Germany stopped shooting each other because of integrated economic systems and how their economies were developing a lot.

And the summer after that, I spent in Croatia when the war in the former Yugoslavia was going on and I thought it'd be a jolly good idea if people there stopped shooting each other. Looking at how you get people to really invest in their own development and stop having wars, people, when they are richer, tend not to shoot at each other.

So I became very interested in economic development and I wanted to do things that were not going to impose cultural values upon any. And I came across project finance and infrastructure because everybody needs infrastructure to develop, and every economy needs water and power and roads and broadband in order for their economies to grow.

So I chose to go into project finance after this bit of exploration into how do I help people's lives get better, and then it has been literally a journey since there.

David
And you founded Navigate Advisory. What does that do.

Beth
So it's, I mean, it's a consultancy of me basically, but it is about helping client organisations look at how do you deliver more effectively. I think clienting is not professionalised, which is a frustration of mine. It's not something that's viewed as something that you need skills to develop. And I think, having been around a lot of projects and pop up clients, there is a pattern of behaviour that keeps repeating itself.

And so what I want to do myself is help clients break out of that pattern and start the projects properly and move into being really cost effective in their delivery and ideally having less of an impact on the planet, but get the same outcomes.

David
It's interesting, in the week that the government announced the end of retentions in construction, there were several comments around how do we protect clients from this. And surely the answer is procure better and then you would not have such a problem with defects.

Beth
Yes. I mean, I think a lot of things with defects are that you do not want your contractors hanging around afterwards anyway. So there is a whole thing about getting your scope right and making sure you are assuring it properly before you declare completion. And there are lots of reasons, lots of good commercial reasons, why people declare practical completion before things are actually done, which I totally understand, but behaviour of contractors and contractor accounting, which is sometimes very interesting, means that it's going to be very, very difficult for anybody to come back and want to fix that problem.

So the onus really is on the clients to make sure that they are getting their money's worth when the job is done.

David
What would you say are the key factors or features of a good client. What makes a good client, do you think, in terms of the procurement process.

Beth
I think there are a lot of things. I mean, I have been saying this week that all projects are the same, but all projects are different. Which sounds ridiculous, but what I mean by that is that all projects have sort of the same lifecycle, but they have their own unique risks. And what happens very often is that companies will say this is how we are going to deliver it.

And then they think about the things that make it different after. And what I think clients really need to focus on is, well, what's driving my costs on this, what is making this different and what am I trying to achieve. Really, what am I trying to achieve.

And you have to set up properly. One of the first questions, and the reason we were in contact in the first place, is, is there a project to be built. What's your problem. And how can you solve this by doing something other than building. Is the first question. Can you put a traffic light in rather than a roundabout in order to manage traffic flows.

As a simple example. And I think that we jump into building sometimes. We jump into finding a solution looking for a problem, rather than going, I understand what my problem is, I understand who I am doing this for, and then that is leading me to the right scope and defining the right outcomes I am trying to achieve.

So it's a lot about that setup, understanding what you are doing.

David
I guess it is mirrored then by the construction process of building before you have designed it. Actually, if you think about how you intend to use whatever it is, or the problem you are trying to solve, then you have more chance of defining it more clearly and getting a good result.

Beth
Absolutely. And I was having this conversation with a client this morning, which was, oh, well, if we are looking at risks, do we really need to talk about operations. Can we just start talking about design. And the answer is, well, no, because the purpose of what you are building is to put it into operations.

The design is only in service of the thing that you are operating in the end. So you cannot just say, go left to right on this, because then I think also you get the wrong scope.

David
So when you have argued overcoming the building problem may be to actually build less, what do you mean by that.

Beth
It's looking at everything. And there is the boring bit, you need to look at your business case and really understand what the options are. And when I think about something like housing, and there is the statement of we need to build one and a half million homes, I am not sure that's the problem. There are a lot of people that are in unacceptable housing that need to be in better housing.

There are also a lot of empty buildings, and those people might not live in the same place. But the first question has to be, is there a way to solve this problem without building stuff. Because building takes a long time. Planning itself takes a long time, irrespective of the planning reforms. So looking at building as the first answer is not necessarily the right answer, because I think that you need to look at what all the options are.

And if there is a retrofitting opportunity, you probably are not going to have to go through planning. I mean you might, but you probably will not have to. It should be quicker. And if you are really trying to solve a problem quickly, how do you do that and how do you find ways to deliver that quickly.

I think there are also lots of ways to think about policy issues. There are lots of people who are living in four bedroom houses that are single families. The demographics of how people live are really changing and people do not necessarily like to move.

But can you incentivise people to maybe change. What are the ways to incentivise people, and that is a policy decision rather than being a building decision, to downsize and free up other space for bigger families.

David
The government have defined this really as a capacity issue and we just need to build, what is it, one and a half million homes. Yes, the majority of those would have to be flats if you are going to hit that target. And Pete Apps wrote a very interesting article on his Substack last week, I think, or a couple of weeks ago, saying actually demand is the issue.

We should also be looking at, and particularly around leasehold reform, so that is the point you make. It is as much political and legal as it is the ability to build. If there is no demand, why would you build.

Beth
Exactly. And I think it is looking at do we understand the demographics of what we are building now. There have been lots of conversations in London about councils wanting loads of three bedroom flats built. There are increasing numbers of people who are living on their own or just with a partner or just with a friend.

And looking at what is really the demand for our housing needs, and is there enough accommodation for seniors. If there is really good and affordable accommodation for seniors, would they still have extra rooms for their kids to visit. Would that encourage people to move out of their big houses, which are becoming increasingly difficult to maintain.

I think there are a lot of different levers you can pull. But it also requires, I think, that you look at short, medium and long term plans. Because building a million and a half houses is not a short term plan. That's not a short term solution. It might be a medium term solution, but it is probably a long term solution, and the problem is real and it exists right now.

So how do you fit in solutions that work in the short, medium and long term. That requires some thinking, and there are policy issues as well.

David
I was actually about to ask you a question. I see you have segued very nicely into that. Because we announce projects without really having honesty around supply chain limits, workforce constraints and delivery capacity. Do we have a skills problem or do we have a capacity problem. Are they the same thing.

Beth
It's a good question. I mean, we have been talking about the skills problem for a really long time and there are not enough people in the industry. A lot of people left because of Brexit. There have been a lot of people who have been working in the industry for a long time who are retiring or getting closer and closer to retirement age.

And it's not necessarily an attractive industry for kids to go into. So I think that there is always a risk. And the nirvana of lots of modular construction has not really landed, has it. So there has been a lot of talk about whether or not that's a solution to the workforce problem, but it has not resolved it either.

So construction is expensive, but it is also not productive.

David
But why do you think off site or modular construction really has not landed.

Beth
I do not know. I think this goes back to a procurement issue and it goes back a little bit into there being multiple stages to this. Part of it is about nobody likes to spend money until they get planning permission. But if you want to build something in a modular way, or you want to build something that is using design for manufacture and assembly, you need to spend a lot more money actually a lot earlier.

And I think that there is a problem between how much money you need to spend to do a modular build and how little you want to spend to get your planning permission.

David
You've also talked about better decision making. So is that a real skill shortage for us, that we have an inability to make intelligent decisions early enough in projects.

Beth
Probably. There are several dynamics as well, because I think that people who are designing like to design big things.

David
Right.

Beth
If you go into engineering, most people are not going into engineering to do a retrofit or to do something small. They are going into engineering because they want to build big things. So there is a natural desire to build bigger things. I think in a lot of the circumstances that I have had, especially working in government, there are not people who have the technical skills that are actually the decision makers.

And so you get into situations, and this is more infrastructure than the building side, where there is a lot of design development that is not controlled and it is not viewed by the engineers as change. It is just design development, just design development. And then you do a design freeze and then somebody costs something and the budget has exploded, and then often because of political pressure, you keep carrying on with your design and there is no time to go back and fix the problem.

So this is where you get costs escalating massively. But as a colleague of mine says, you have had this massive cost escalation, but you are no longer designing the same thing. It has changed beyond recognition. So yes, it is way more expensive than what the other thing was, but it is not the same thing. It is not controlled in a lot of circumstances.

And it goes back to decision making. Are people actually focused on the right questions.

David
I guess in the commercial world and non infrastructure world, that's the equivalent of the professional team designing a building the client cannot afford. They brief for a Stirling Prize winning exemplar building, but they cannot afford it. But that design time is lost, the financial clock is ticking, so then we value engineer our way into a solution that looks very much like the thing we put in for planning but is in fact just a facsimile.

Beth
Yes, yes. And there is not a sense that, and I think this is really important, what is your budget and designing to a budget. We seem not to want to do that. And it goes back to, okay, well where is the point at which it is no longer acceptable.

And how do you avoid making unpleasant compromises by designing to the budget to start with.

David
We often talk about a lack of innovation in the industry and certainly a lack of profitability in the industry, but it is one of the reasons why we do not see massive change. Actually the construction industry is very good at delivering profitability for development companies, for example, and clients. It delivers a very nice return, thank you very much. Therefore why would you want to mess with that by innovating, shall we say.

Beth
It's a really interesting question. And I still think the industry is unique and somewhat odd compared to lots of other industries because, other than house builders who often have the full vertical integration, you have a client and then you have got a contractor and you are always looking to the developer to specify the job.

The contractor is not specifying the job. And so unlike lots of other industries, any kind of manufacturing where if you are business to consumer you are looking for what sells to the consumer, construction does not do that. They are responding to a request by a client to do something a certain way. So I think that's how the innovation can often get lost.

Because unless the client is driving it, how do you bring the innovation in. How do you justify investing. How do you take those things forward when you are responding to a client request. I have been talking about how you can look at different ways of modelling consultancy, because it is normally bums on seats, you pay for bums on seats.

But we have loads of technology now that should be able to be integrated with people to get better, quicker answers. But we pay for bums on seats. So how do you actually pay for the designing of the model you are going to use to do lots of iterations. Because the value is not necessarily on hours of people working on it, it is on building of the model and then letting that run.

And so the innovation could happen. But the ways in which clients procure, I think, sometimes block that from happening, or a lot of times block that from happening.

David
I've just come back from the US and there was a lot of discussion at the conference I was at about the use of AI and whether it was a good thing or a bad thing for people. I think the general consensus was that it was going to increase the productivity of those people who are already experts.

Do you see that this will disrupt the industry significantly. Will it allow us to do more, or how do you see it impacting.

Beth
It's one of those things that is too soon to tell, I think, in a lot of circumstances. But one of my concerns is that a lot of the skills you get when you become the expert come through hard graft and lots of repeat work where you are learning how to design.

If you are a lawyer, you are learning how to draft documents. If you are in finance, you are learning how to run a model. You are looking at all these different risks. So you cannot get those skills without doing a lot of projects and seeing things from lots of different angles. So I think there is a risk that the kids these days are going to have a hard time getting that experience.

But I do not think we have necessarily figured out how we embed building expertise with the modelling. We are just sort of assuming it is going to solve all issues, where I think we need to figure out how we use it to its best advantage. So I think about computational design that's been around for a long time, and you can put in all of your constraints and then let a model come up with all the different permutations for building a building in London with your rights of light and the streetscape and how do you get your angles right.

And all of these questions. So you can let the model run that, but that's not your end answer. You still have to do lots of work once you get that shape, but it allows you to have more shapes than you could possibly ever think of before that. And that's a good thing, right.

You are trying to optimise. But it has to work in partnership with humans, I think, to get the best outcomes. It's allowing for those lots of variations and then allowing humans to do the things that humans really do.

David
Yeah. And one of those is the ability to look at something and say, yeah, that looks right, or that does not look right. Have another look.

Beth
But it's also about, does this building work for human beings. Does this thing allow people to move around in a way that people are going to want to live.

David
It's interesting. The value of the built environment largely seems to be discounted by many people. Ninety per cent of us spend ninety per cent of our time in a building and we have people who are made ill by buildings, we have people who are less productive, kids in school do not learn as well because the indoor air quality is not right.

How does that get sorted in this mix of the need to hit budget and the need to operate buildings as cheaply as possible. How do we square that circle.

Beth
Well, I think again it goes back to how do we think about what we are doing and do we think about who we are building for. We do tend to focus way more on profitability than thinking about human beings.

David
The question is, I have always kind of argued that the client does not want a building, they want a return on investment in a lot of these issues. So again, as long as it looks like the thing we put in for planning, with zero enforcement, you end up with buildings that do not work.

Beth
And there is a question about, when you are a building owner, how much do you care about your customer. When we are homeowners we care a lot about the customer because we are the customer of our house. So we really care about what's happening in there.

And I think when you've got a lot of the real estate investment trusts, they are kind of going, well, are we doing return on investment, are we a financial organisation or are we trying to provide a service to our customers. And that's a dichotomy that is really interesting from their perspective because they have lots of investors who want to make sure they are getting the return.

But I think that this is one of the things you also see on the high street, where people who own shops want to get a really good financial covenant. So there are phone shops, which might not be the thing that the people on that particular high street need, but the people who are the owners of the leasehold are not necessarily interested in that. They just want somebody who is going to pay the rent.

And I think that is where it is a really interesting split between the end user and the rent payer and the owner.

David
And society, is there not, because if it does not meet its energy targets, for example, we have to build more capacity into the grid. We build Hinkley C at the taxpayer's expense. So there seems to be a lack of social contract in that sense. The buildings that will be there for hundreds of years, yet the people who have got their return on investment have disappeared while the rest of us pick up the tab.

In the longer term, does that require a major rethink on the built environment and how do we get people to value it more.

Beth
It's a great question because I think we do value our environment. But I think there is a separation.

David
When it goes wrong though, then you value it.

Beth
But there is a separation between the people who use it and the people who own it. Do they have the same interests. Are their interests aligned. And I always think in any negotiation that in any good project you need to have aligned objectives. And I think in a lot of circumstances we do not have aligned objectives between the people who own the built environment and the people who use the built environment.

And that's where the social contract is broken down because building ownership is financial whereas building usage is social. So trying to get those aligned objectives, how do we do that. I do not know on that one.

David
No, I think that's a legitimate answer. I do not know. Very difficult. Could we talk a bit about complexity and particularly from your time on East West Rail. What did you learn about the cost of complexity and how much complexity is self inflicted.

Beth
There is complexity in a lot of things and I think one of the things that I have recognised for a long time is that we often try to solve complex problems with complicated solutions which then are not implementable. So it's really difficult and there is going to be someone very clever coming up with a complicated way to solve something and then when they leave the scene, the person who is trying to implement it does not understand it, so they do something else.

And at East West Rail, one of the things that was happening when I joined was that it was trying to be lots of things. So really the purpose of East West Rail is to be a commuter railway. And when you think about it as a commuter railway, you think about it in a much more straightforward way because it does not need to be fancy, it needs to be reliable.

As I like to say, you need to make sure that your kids are not chained to the fence post from nursery because you know the train is going to get you there. You are not going to move somewhere if you think that you are never going to be able to get home on time to pick your kid up from nursery or school or get to your yoga class or whatever it is that you are doing of an evening.

Those life choices are going to be dependent also on your transport and where your job is. And if the objective is to try to get people to move to that region and work in Cambridge Biomedical Campus at Addenbrooke's Hospital, you need to make sure that that train is reliable. So we were talking about stations and do stations need to be whatever.

And it's like, no, the stations need to be a shed because nobody should be there more than fifteen minutes ever. If they are there for more than fifteen minutes, something has gone wrong. So it just needs to be simple and dry and probably some toilets, but it does not need to be anything fancy. Does East West Rail need to have lots of great connectivity.

I would not say that is a priority because, yes, we want to be able to get to our Wi Fi and everything else, but if you are on the train for fifteen or twenty minutes, it does not need to be amazing. The train needs to be reliable so that people can depend on it.

And when you can strip things down to what is the purpose of why you are doing something, you can strip away some of that complexity because you are very focused on that key objective. And it should make your decision making easier rather than more complicated.

David
So avoid mission creep.

Beth
Avoid mission creep.

David
Good advice. Should we therefore spend more time, this is kind of part of this, but should we spend more time designing buildings before we start constructing them and make better use of digital tools and DFMA and other modern methods of construction.

Beth
I think we should, but I think that even before we start designing, there is a bit of that starting right issue of understanding who and why we are building for. Because you can design anything. Engineering can solve most things. It depends on whether or not you want to pay for it. So really understanding all of the reasons why you are building something and who you are building it for should allow you to spend that time in design more wisely.

And I do think if we want to move into more manufactured space, we do have to spend more time at the outset trying to understand what products are available to us and how we build them into our buildings.

David
And similarly, we have a huge focus on capital cost and yet that is a fraction of the total cost, the whole life cost. How do we break that focus on the initial cost of a building and saving pennies here that costs us hundreds of thousands over the lifecycle of the building. How do we break that.

Beth
It's really, really difficult. And it's one of these things that when you look across different sectors, everybody talks about TOTEX. And when you look at water, for example, you are looking at total expenditure. But at the end of the day, the money up front is what everybody ends up focusing on. When you have to make a decision between, oh well, should I spend a bit more to make it more cost effective later.

It is often eye wateringly expensive to do things at the outset. I think it's a really hard thing to break because also these assets are lasting for a long time. So these operating costs go on for a very long time. And each year's operating cost is a fraction of your capital cost, despite the fact that in total it is bigger.

So it's a hard thing to break. Probably the issue is how do we bring down capital costs so that we can focus more on the balance between capital and operating costs.

David
And does that mean more things like standardisation of design. Why should a hospital be different in Sheffield from Manchester.

Beth
I think the more that we can look at standardisation, the better. There are a lot of other things that I have noticed on projects in that people like to do something new or do it their own way. And the standardisation does not necessarily just need to be on design, but in how we organise data.

I spend more money than I'd like to say on paying for people to set up a project management office and my project controls. Why can I not have something in a box that I can just push a button and it pops up, that's my structure. It would be really useful. And then you would have better data as well, because everyone would be reporting data consistently in a bunch of different ways.

But I seem to have worked in loads of places where you have to set it up from scratch every time. That costs money.

David
I get that. But also the data sharing bit. We have a toxic relationship with information in construction.

Beth
We do.

David
The first question you ask yourself when you get a request is, how can that be used against me. And therefore you tend to hang onto it. Which leads me onto behavioural change and culture change. Surely they are the critical things that need changing in the industry. How do we go about that.

Beth
My flippant answer will be bring in more women because I think that there is a, well, that's more of a diversity point, because there are a lot of people who have the same behaviours that reinforce themselves over and over again. That is flippant, but there is a point that we need to learn how to communicate with each other and there is a trust point in the industry.

Nobody trusts each other. And I think that's been a longstanding thing. You bring up the data point really, really effectively because nobody should be arguing about the quality of the data. Nobody should be arguing about whether or not a number is right. You should be talking about how do you solve the problem.

But it goes back to are people's objectives aligned. Are we all trying to win here. I have never seen any of these things as zero sum games where I win and you lose. We both need to win together because we can both win together. And I have said loads of times as a client organisation that I do not want people to make no profit.

I want companies to make a profit, but I also want you to save me money. So how do we find ways that everybody can win on these jobs. And the trust element just is not there to do that. And it's an interesting dynamic. There is also a whole thing about people not trusting that they can raise an issue.

People are afraid that if they raise an issue that's problematic, they will get shouted at or fired. There are some really problematic behaviours in the industry that lead to the lack of trust.

David
Is that driven by contract law. Most of it is adversarial.

Beth
I do not know. I do not know where it comes from, but it is not going away. And you have had all these different reviews over the past however many years talking about being more collaborative. We are no more collaborative, right.

David
We are all very collaborative until it goes wrong. What does the contract say. Oh, you are liable.

Beth
Or we are collaborative with each other on the top tier of the supply chain, but down the supply chain, nobody is collaborative at all. And it all goes to really aggressive behaviour. I think that there are lots of things that we have to talk about in terms of what is this culture that we are trying to establish and how do we all win in this environment.

David
So in the UK, we have introduced the Building Safety Act, which is all about culture change, essentially, notwithstanding everything else. It talks about behaviour change, culture change, and in the competencies one of the SKEB criteria is behaviours. What behaviours do you think we need to change.

Beth
I think there are many. I think that this unwillingness to share information is really, really important. No one is going to get a better outcome if you do not actually acknowledge that there is a problem. So running three sets of books on a job helps no one. It makes sense at the time, but it does not help your client relationship.

If you are telling them one thing, you are telling your board another thing and then you have your real job, right, it does not help. So I do think going back to consistent data and the ways in which we are talking about it, and being able to have an honest conversation about what is actually going on, is the start of how you can move into a more trusting relationship.

But I think that there is still lots of shouting on site and all, you know, when I go out on site a lot of times I am looking at housekeeping, because housekeeping will tell you what's going on on the whole site. Are things in the wrong places. Is it a messy site.

All those kinds of things should be coming out of the Building Safety Act. They are the immediate red flag that something is not going well and it is about caring about your work, really.

David
There is increasing fragmentation and that is, how do you get that message through highly, highly fragmented sub, sub, sub, sub subcontractors.

Beth
Well, and I even think at the main contractors you have an issue, which is that you are not going back to the mothership very often. You are out on site all the time. So how do you even have a corporate culture at all. You just have your project culture. And often that's what you have got. You've got these very fragmented project teams that are around and they have the culture of the leader and that's it.

So some of this goes back to the client and what is the client doing and how does the client foster the right environment. But it's trying to make sure that the specialists who are down the supply chain feel like they are part of the work. And this might come back to design, and how they factor into what the design solutions are.

David
I think very often they know that the design is wrong, but if that's what you told me to build and that's the way I make money, so I will carry on doing what I've been told to do in the full knowledge that it's wrong.

Beth
But that's not a very good culture, is it. I mean, that's terrible. It's wrong, but I am going to do it anyway because that's what you've told me. And I'll make money, but then I might have to change it. No one wins there.

David
So apart from having to change contract law, the way we account for projects, the way we design and build them, everything else is pretty good. Yeah, it's pretty good.

Beth
But there are a lot of amazing things that are getting built. I think there's a privilege in working in this industry, because we do need to acknowledge that there is a massive privilege in being able to shape people's lives. And we do not talk about it enough. What we do is really important to how we all live.

And that is a privilege and it is something we should embrace as an industry.

David
I think so. And I think almost everybody that goes to a site in the morning has the intent of doing the best they can. And somehow we manage to mess that up on the way. But we still deliver fantastic projects.

Beth
We do.

David
But just in a really unproductive and hurry scurry way, which helps say we have not even talked about the mental health of people involved in this hurry scurry process. But all of those things, like untidy sites, I think the mental health and the suicide rate are tells of an unproductive system. So I am going to ask you a final question on this, and that is, so you are the new construction regulator.

What one thing would you change that would make a significant difference.

Beth
This is very utopian, but I think it's worth having everybody who is working on a job understand who they are building it for. So that there is a bit of a, and I hate the word chartering, but there is something about why are we doing this. It's like when you think about good teams, they know what they are trying to achieve and you understand why you are on the pitch or why you are in the boat and you understand what your role is.

Who are you as an individual and then what's the end objective. And if everybody on site were to understand that, would you get a better outcome.

David
And what their part is within that.

Beth
And what their part is, yeah. So it is like, if you are a striker, you know you are the striker, but you are still trying to win the game as much as the goalkeeper is. You have your part and you have got your role, but you are a team. And I think it is that whole thing.

And here again, that privilege of providing our built environment, knowing who you are building it for and understanding your role in making somebody's life better, that's really powerful.

David
Beth West, thank you very much for joining us today on Behind the Built Environment.

Beth
Thank you.

David
Hello, I'm David Frise, Chief Executive of BESA. Welcome to Behind the Built Environment, the podcast where I delve into the major issues facing our industry through in depth conversations with key industry leaders. Join us as we explore the trends, challenges and innovations shaping the future of the built environment. Today I'm joined by Paul Ruddick, Chair of Reds10.

Reds10 has emerged as a standout in the offsite construction sector, pushing industrialisation, embracing digital tools and setting bold ambitions, including a £500 million turnover target. But the journey has not been without headwinds, especially in a market where many modular firms are struggling or folding. So what makes Reds10 different. Let's find out.

David
Paul, great to have you on the podcast.

Paul
Great to join you, David, thank you very much.

David
So, Paul, before we get into the main discussion, let's start with some quick fire questions. Yes or no. More difficult than it looks.

Paul
Okay.

David
But it sets the agenda for today. Do you believe industrialised construction will be the dominant delivery model within the next decade.

Paul
Yes.

David
Can modular buildings consistently match or exceed the quality of traditional builds.

Paul
Absolutely, yes.

David
Has the construction sector embraced digital transformation fast enough.

Paul
No.

David
Is the UK's current procurement system fit for supporting offsite and modular innovation.

Paul
Yeah, I think so.

David
Do you believe AI will significantly transform how we design, manufacture and manage buildings in the next five years.

Paul
Yes.

David
Great. I think you're the first person who's ever managed that without a maybe. I'm not sure. Before we go into the major bit, did the career choose you or did you choose the career. How did you end up running Reds10.

Paul
It was a series of accidents, really. When I finished school, I didn't really know what I wanted to do. I was applying for universities and I didn't understand and actually my mother came to me and said, why don't you consider a career in construction as a quantity surveyor. Now, I've got no family relations or history in construction.

I was quite surprised by it and I said, well, why have you chosen that. And she says, well, I know you can't sit. I struggled to sit in a classroom all the time. I was a bit lively as a child, but I was quite good at maths and she saw that in me and I applied to university and I did a degree at Heriot Watt in Edinburgh. It's quantity surveying and building economics.

I did that and then it took me to London. I chartered as a surveyor, did that for seven or eight years. And then in 2006 I started Reds10. So my background is actually a consultant, not a manufacturer, not a contractor. So how I ended up here is probably going to talk about it, actually.

David
Yeah, that's quite unusual for your mother to suggest construction. I think most mothers kind of go, yeah, you don't want to do construction.

Paul
I don't know where it came from. But she was actually a teacher, so she was careers advice and all that kind of thing.

David
Did she have any other options for you. Was it simply, this is. I've done the homework and I think this is the best option.

Paul
Yeah, I actually can't remember because I did choose other careers and other degrees, but I can't even remember what they are. But it was a great decision and actually, if I had one regret in life, I kind of wish I'd found construction earlier. I wish when I was. Instead of having summer jobs and weekend jobs, which were just kind of standard, like working in a cafe or petrol station, I actually wish I'd done it in construction. I wish I'd spent more time on site in my early career, early life. But it is what it is.

David
So can you take us back to the beginning. What inspired the formation of Reds10 and how has your vision for the company evolved as the industry has changed.

Paul
So I'd love to sit here, 20 years ago I sat down and said, look, I want to have a 200 million turnover, be half a billion one day and be industrialised construction, but it doesn't work like that. When I first went to London and I worked as a chartered surveyor, I actually worked at Heathrow Airport and there's a chap called Sir John Egan who wrote the Egan Report and he transferred from Jaguar Land Rover to Heathrow and he was saying, well, why can't we industrialise construction.

And, you know, we've had the Egan Report, the Latham Report, the Mark Farmer Report, and that was my first learnings and I didn't, because I hadn't been involved in construction before, I thought, well, actually, why is construction so fragmented. And I did that for a year or two and then went on to other roles, but it must have stuck with me.

And then in 2006, I saw an opportunity as a consultant, actually. So I started in my bedroom as a sole trader, the business offering consultancy advice to schools that were getting built. And over the next five, 10 years, I got involved in volumetric buildings, providing temporary schools and then that evolved to where we are today.

But the business has grown. That view of where I started, that construction's kind of missed the Industrial Revolution, it needs to change, the other industries have done it, it kind of stuck with me and as I've gone further in the career, I try to do something about it.

David
So you've gone from your back bedroom to what, about 350 million turnover.

Paul
It's 200 million at the moment.

David
200.

Paul
Hope for the next two or three years it will be 350 and then.

David
Half a billion and you're still debt free. How have you balanced that ambitious scaling with financial resilience, which is in what has been a volatile market.

Paul
Myself and my brother still own all the business, so one thing we've got on our side is time and patience. I think a lot of the modular companies have failed. They had private equity backing, or they had big, deep pockets and they kind of went too big too soon. They had all these ambitions, built a huge factory, but actually didn't sort the human element out, didn't sort the processes out, didn't sort the technical details out.

And because we started from nothing and we bootstrapped the business, we've had time to do that. So where we are at the moment is we're in a really good position, we've got a great team, but it's taken us 15 years to grow that and now we're ready to springboard into more growth.

David
Did your brother, by the way, get the same careers advice as you did.

Paul
My big brother's doing quantity surveying, so I'll do it as well. So I've actually got three brothers and all three of them did it as well and followed us into the industry. We all work within the business or businesses, because Reds10 is actually a group of nine different companies. They all work in a separate part of the business at the moment.

But I've tried to create Reds10 as being a family business, but with a meritocracy. So unlike other family businesses, we're not in positions where we're not qualified for. We've got some proper qualified people into that.

David
And where did the name come from. Reds10.

Paul
So I don't talk about my mother again, but when I was starting Reds10, naming a company is actually quite difficult. I couldn't think of a name for some reason. I didn't want to call it Ruddick, Paul Ruddick, because I thought it might restrict me in the future.

So my mum said to me, so why didn't you call it Reds10. And I was like, well, yeah, it's a name, it's a colour and a number. People remember it. So where did you get that name from. Oh, it's actually my surname. Rudd is Anglo Saxon for red. And dix is French for 10, so Reds10 is Ruddick. So that's where it came from.

David
Wow, great story. You've spoken a lot about industrialisation of construction. What does that really mean to you. And what's the transformation you're pushing for in design, manufacturing and delivery.

Paul
I think construction. If I said one word to sum up the ills of construction, I'd say fragmentation, where we're relying on 20 organisations to design a building and another 20 or 30 to build the building. And people wonder why we're not making progress in terms of productivity, why we're not making gains in terms of clever design and all that kind of stuff.

Because you've got 50 organisations that come together and then go apart and come together and they're not aligned. They're all holding their IP close to them because they're relying on their next job. And my simple view is to vertically integrate and try to bring as much design and construction industrialisation in house as possible.

And once you've got that philosophy, then you can go down the industrialisation route. And if you're looking back to those other companies that failed, I think they just went for the industrialisation route without taking a step back. Everything starts with design and process, so sort that out and then the construction can follow.

David
And you use a lot of digital tools in that process. AI, data systems, to boost what, predictability, efficiency and quality across all the operations. How does that all fit together.

Paul
We're a gold partner of Autodesk, so Autodesk, Revit, BIM, CAD, and we're working very closely with them to make sure their systems integrate. So our common data environment is ACC, which is Autodesk. But also now we're working with Autodesk to put scripts and automation into that.

But again, you can't do it in isolation. You can't have the architect or the steel fabricator way ahead of everyone else in terms of their tools and the door manufacturer or the fire stopper using pen and paper. It doesn't work. So everyone has to be on the same level and using the tools at the same time.

And as I said, we've got nine companies within the business, but those companies are in house M and E, in house furniture, in house doors, which then build into the design and manufacture side.

David
And you can't do that without a client who understands it. Can you tell me a bit about what you're doing with the NHS healthcare programme or the New Hospital Programme.

Paul
95 percent of Reds10's clients are the government, and I think the government get criticised sometimes, but I actually think they've done a lot in terms of setting up frameworks and pipelines of work. So we established ourselves in the Department for Education, now the Ministry of Defence, where we've demonstrated that secure pipeline and repeatability of design standardisation. Then you start to get the benefits of that.

So we've got involved in the New Hospital Programme and we approached it by building the prototype single bedroom ward. So 50 percent of the New Hospital Programme are bedroom wards. So what the NHS and NHP are doing is recognising this and saying, let's not redesign the wheel. Every single hospital we're going to build, let's standardise the design.

So we worked very closely with NHP and their design team, took their concept design, and we manufactured it and built an actual full scale single bedroom ward. And in doing that, we've also worked through some of the design coordination issues, the fire stopping details, the plumbing issues, the connections, the patient experience.

So it's been a great piece of work and real foresight. And I think when the New Hospital Programme gets released in the next month or so, the successful contractors will be able to take that information and incorporate it into their new hospitals, and hopefully we'll be working with them as well.

David
Although you do a lot of work for the government, you've stressed that diversification is really important for a modular manufacturer. So you're in defence and education. Why is diversification so important to a modular manufacturer.

Paul
Well, I've got a big factory. I've got five or six hundred tradespeople that I need to keep employed. In a single sector you do have planning delays, decision delays, funding delays, and you can't be dependent on just one sector. So I realised quite early on that we need five or six different income streams as one goes down and one goes up.

So we've also got a big hire fleet as well. Temporary classrooms, site accommodation, which we provide so if we have a down spot in the factory, then we can put some temporary accommodation through to even out the strain. So if I want to go from a 200 million to a 400 million, 500 million turnover, I need a lot more work coming through.

And what we're finding now in the factory, as we industrialise, where something was taking me 50 days to build is now taking me 30 days because we're getting better at what we're doing, we're getting better details using sub assemblies. So again, we need to find that income stream. Hence us now moving into the NHS sector, but also we're looking into the residential sector as well.

David
So what would you say are the foundational pillars of that growth through modular, organisational, financial, technology. What are the pillars that are allowing you to do this sustainably.

Paul
Good people. I've realised that you need the right people with the right shared vision, the right culture in place. And once you've got that, then you can pretty much do anything. I think the other key thing is design and process. So we've invested loads in design, technical design. We've got our own steel fabrication capability, our own insulation capability in house, our own M and E design in house.

So it takes time to design that and stand up the team. And once that's in place, then we can start looking at throughput through the factory.

David
We talked about the pillars of success. A lot of modular companies fail though. You see the headlines. What do you think the reasons are for that.

Paul
I think they went too big, too soon. They didn't spend the time sorting out the processes, sorting out the details, making sure the building doesn't leak when it gets transferred from the factory on the back of a lorry or onto site. We've been doing it for almost 16 years now. We know what the roof detail is.

And 10, 15 years ago, I had leaking roofs. I'm not going to run away from that. And we had some issues in our units to fix. But we've learned from that. We've developed our details from it. It just takes time, because if you're building traditional construction, there are standard details out there that have been there for 10, 20, 30, 40 years.

We've got to develop those details for modular. But I think the other key reason why they failed was because they had only a single income stream of residential and the market just, there wasn't enough throughput coming through. So they got caught by the planning laws as well. It's a shame because a couple of those, in general, they were bang on the money.

If they'd held on and hadn't gone so far so quickly. The industry's crying out for affordable housing to be built at pace with high quality. And that's what they were going to do. That's what we're going to do. But we need more of us to do it if we're going to hit the 1.5 million target.

David
And one of the other challenges facing offsite is demand volatility and procurement cycles that don't always align with factory economics, which is what you've been describing. What would you like to see change in public or private sector procurement to support a more sustainable industry.

Paul
I think the biggest issue for construction, not just modular, is planning. Before it used to be 12 weeks to get planning, it just doesn't happen anymore. It could take six months, 12 months, 18 months. And that uncertainty needs to be taken away and addressed. And I do think the government planned infrastructure bill is the first step towards that.

But we need to sort it out. I've never seen a school be refused planning permission. It always gets built in the end. But I've seen a school take two, three years to get planning permission because they need to make a tweak, which in the bigger scheme doesn't make any difference at all. But it's the process and we need to address that because while that school wasn't built, inflation went up, so it cost more to build and those kids didn't have a great education building for two years as well.

David
I read an interesting article that kind of backs that up. I think that we're a nation of lawyers compared to China, where they're a nation of engineers. They say they're going to build something, they build it because there's nothing to stop them building it. The net result is you might end up with a railway that goes from nowhere to nowhere, but you get stuff done.

Whereas in the UK and to a degree in the US in some areas, because everybody's got a legal background, there's due process to go through that takes time, expense and takes so long. How do you cut through that without ignoring people's objections, but still get stuff done within a reasonable timescale.

Paul
Yeah, I think also when you get planning, there's so many consultees who can stop it. 20 people can say no and one person can say yes and you have to go through. Look at the Lower Thames Crossing. Some ridiculous amount, like £250 million being spent, might even be more than that, on just planning. Spade isn't in the ground. How can we get in that situation. It's crazy.

David
Yeah, something has to change, doesn't it. You've structured your leadership to embed technical innovation and industrial thinking at all levels. How is that helping you future proof the company and develop the next generation of talent.

Paul
In particular, if you look at my business, any business, if I'm true to myself, when we deliver our work, we rely on great people to deliver work and you've got those key superstars in your business and we need to get away from that where we're not firefighting. So we've got an absolutely clear process from start to finish. Whether it's initial design, procurement, costing, going through design, technical, it's just a smooth process. So anyone can slot into that process, which is industrialisation, anyone can go into the line and pick it up.

And in construction, we rely on really, really good people to come and troubleshoot and rescue that. So the reason why we've embedded technology across the whole of the business and our sister businesses is actually how can we turn what we do into really clear process.

And I talk about that because when I first joined the industry, the consensus was in 20 years time you'll be useful because you've had loads of experiences and stuff like that. And I'm a great proponent of bringing young people into our industry because they're very technology savvy. But the problem is our industry is so complicated that for them to pick it up takes time.

But I think technology and process and standardisation is a way to accelerate that. If you come to our offices, which you've been to, we have a very young demographic. Technology wise they get it, but in terms of standard details and coordination they don't. But if you've got standard designs or a standard design platform which you repeat, repeat, repeat, they probably don't need to know that as much.

And that's where I think AI can come in by freeing up the super deliverers, I call them, so they get time to think, really look at the problems, understand the details, instead of firefighting the whole time. And that's when you get even more.

David
Benefits as well, I guess, where you can really add value as opposed to just go through process.

Paul
Yeah. Every organisation can think about those brilliant people, we've got a problem, we send them in, they're the troubleshooter. But how much better would those people be if they were there just looking at how we can improve process and how we can change details and how we can improve stuff rather than getting sent in to sort out problems. And our industry has lots of problems because there's 50 organisations building it.

David
That's what we call innovation. When we get over a problem, rather than thinking about it before the problem occurs, well.

Paul
But also capturing that innovation, the lessons learned. I'm not convinced it's captured enough. People do and there's almost a disincentive not to capture the learning for the way the industry is set up, because then especially a subcontractor can get variations out of it down the line when it happens again. And that's our industry and that's what we're trying to address.

David
Is it easier to attract talent because you've got a different business model, do you think.

Paul
No, it is, actually. We have a lot of women in our company, for example, and when they come into interview and they walk into our office and they see a lot more women, I've had a comment that they joined our business because it felt very dynamic and not traditional.

David
What role does offsite have in the UK's decarbonisation targets and ambitions.

Paul
Huge, actually, because standardisation and industrialisation means you're doing it once, you're doing it more efficiently, you're spending fewer man hours on it, there's less waste and you're delivering at lower cost and it takes a shorter amount of time to build it. If you add up all those things, then you're reducing carbon footprint.

So I think it's the way. Every other industry is industrialised, every other industry apart from construction, and we need to have that mindset and say, well, we need to change. And I think the natural change will reduce carbon.

David
Is the reason it hasn't changed though because we build prototypes and therefore it's persuasive to say we need to do this in a bespoke fashion every time.

Paul
It is. But the way the industry is set up, we're incentivised to build prototypes.

David
I guess you're right.

Paul
I'll leave it at that.

David
Yeah, we are indeed. Just a final bit around policy and regulation. Does it really support modern methods of construction and are there still barriers to widespread adoption, do you think. When you go before clients, do they need persuading to go down the modular route.

Paul
They do because of the failures you've mentioned. What I tend to find is once we go into sectors, so education now, there's no questions. We're delivering in defence, we're delivering it. I have a hearts and minds issue when I go into a new sector because of the failures. It doesn't work.

But we build great buildings. If you strip it all back, it's a steel frame building with exactly the same materials as traditional construction. But it's down to us, the offsite industry, to build buildings that are quicker, high quality and at a lower cost. Because if we do that, there'll be no barriers because that's what clients are interested in, the delivery vehicle. And I think it's now down to the industry to deliver against that.

David
You talked about the importance of design. A lot of people have a view of offsite modular as boxy and bland. Is that still the case.

Paul
No, not at all. Again, it's a steel frame building. Listen, we are not going to build the Sydney Opera House, we are not going to build a landmark building through it. But social infrastructure, schools, prisons, accommodation, housing, they can look great. It's exactly the same materials.

But for the New Hospital Programme, for example, we are not going to build the central core and all the complicated spaces. It's going to be a blended approach. We can go and build all the wards and we can industrialise that and deliver it at high quality.

So five, 10 years ago, I'd say everything must be volumetric, this is the way forward. But as I've matured in my thinking, no, it needs to be a blended approach. And we are working with some big tier ones in terms of potential joint ventures in the future, where it's exactly that approach. We do what we're good at and they do what they're good at and I think that's the way forward.

David
I guess there's no reason why a classroom should be different in Bradford to Bedford, should it really. It should have the same components.

Paul
Yeah. And the way the Department for Education procures schools now, those classrooms aren't different. They have standardised it. I think they've done a great job on that.

And it's kind of like the tweaks. The biggest issue with schools is the planners making sure it looks the same as the local landscape, which we can do. But then you get planners who have specific requirements that, you know, I don't like. I want double height space here or whatever. And it just costs a lot of money to the public purse. When you look at it, does it make that much difference. We can make it look like a great building. That's the kind of thing we need to address.

David
I'm going to attempt to summarise what we've talked about. Modular offsite has a great future. You've got a great model for taking advantage of that. You focus heavily on digitisation, technology, innovation, talent. In order to do that, don't grow too quickly. Grow in a manner that you can control and you have control of quality and design and all the elements of the build.

We need some changes to planning to make it easier to build, period. But there's a great future for modular construction in the UK. Does that sound.

Paul
I think we can become world leaders at it, I really do.

David
Do you think we are already or not.

Paul
We are world leaders in the uptake of 3D design and world planning delay. Our name's getting out around the world. A lot of companies from other countries visit me and start to talk. You'd be amazed how many of us have the same issues across different construction areas.

There's a huge social housing problem across the developed world. There's huge legislative barriers that stop it getting built. Sometimes you need to take a step back and go, actually, there's the requirement, the funding's there and we need to stop certain vested interests and work together to deliver it.

Because everyone deserves to live in a lovely house, afford a lovely house. And I think mass production, quality and scale can address that. And that excites me.

David
And that's a great way to finish. Except I've got one final question. If you could change one thing, you're the king of the industry, whatever you say goes, what thing would you change to make the industry better.

Paul
We could probably guess what I'm going to say, because I picked it up, but I think to make the industry better, there's probably one legislation piece and one behavioural piece. The legislation piece is we need to sort out planning. Key government infrastructure projects like schools, hospitals, prisons should be delegated powers. We shouldn't have to go through the whole planning requirement. There should be a central government team that makes sure the buildings look great, but they should go through because it's costing us a lot of money in delays and it's costing the population in them not having great buildings.

So that's the first thing I would change. The second thing I would change is culture. There's too much confrontation and people not looking at the bigger and long term picture. And if we can address that, and that comes with fragmentation of how we're set up, but if we're going to address those, we're going to have a great next decade.

David
Well, you did great on the short yes or no questions. You did terrible on the one thing you changed too, but exactly. Paul Ruddick, Chair of Reds10, thank you very much.

Paul
Thank you very much.

David
Thank you for tuning in to Behind the Built Environment. If you enjoyed this episode, like, share and subscribe on your favourite podcast provider. And don't forget to leave us a review. It really helps us to reach more people across the industry. For more in depth conversations with industry leaders and the latest updates from BESA, stay connected and keep listening. Until next time, I'm David Frise and this has been Behind the Built Environment. Goodbye.