CCNZ update

Making and taking opportunities in 2017

This article first appeared in Contractor February 2017.

By PETER SILCOCK, Chief Executive, Civil Contractors New Zealand

THE 2017 CONTRACTOR Perspectives provides very interesting reading. Unsurprisingly, everyone agrees that there is a good level of work available and the high levels of infrastructure expenditure will continue through 2017.

With infrastructure investment levels already at record levels the civil contracting industry received an early Christmas gift on December 8 with the Government’s half-year Economic and Fiscal Update and the 2017 Budget Policy Statement. The update reported on the continued strengthening of the economy, with growth expected to average three percent over the next five years, contributing to rising Government surpluses.

To support continued solid economic growth and deliver better public services the Government said that it has identified a number of high quality capital and infrastructure projects such as schools and hospitals and the first stage of the Auckland city rail link.

As a result, the budget capital allowances have been increased from $0.9 billion to $3 billion in Budget 2017 (including an initial estimated allowance of $1 billion for Kaikoura) and to $2 billion per Budget from Budget 2018 onwards.

New Zealand’s record infrastructure investment levels just took another step up which is great news for the industry. But that doesn’t automatically mean that every contractor in the country is going to be swamped with work.

The civil and general contracting industry has always been very challenging. It requires people and businesses that are savvy, entrepreneurial, innovative and adaptable. That will not change just because there is more work around.

What is new, or at least has become more pronounced, is that clients are looking for higher levels of professionalism and assurance. This is being driven by the new health and safety laws, more sophisticated procurement and a greater focus on environmental protection, public relations, asset management and whole of life costs.

The business environment and clients are changing and as a result contracting businesses are becoming more professional as they strive to differentiate themselves and provide the greater levels of assurance that clients are looking for.

Positive relationships not just with clients and customers but with the public are critical in this new world. Communications networks and social media mean that one person’s bad experience can become a public relations nightmare and a barrier to getting future work. Many civil construction clients are public entities or large corporates that are very sensitive to reputational risk.

Good working relationships with other contractors are also important. A mutually beneficial relationship with other contractors can provide a wider range of skills, expertise, equipment, and resources to manage workloads at critical times.

Whether a company is large or small working together informally, forming alliances or joint ventures or entering into subcontracts is part and parcel of the contracting industry today. Those relationships are not just about the respect that your partners have about the quality of your work they are also about your reliability, how easy you are to work with and how you handle new challenges and stressful situations.

CCNZ has a role in this because not only do we represent and advocate for contractors we are also committed to helping our members be better prepared for the future. We want to ensure there is work for all contractors but we also want to help our members work more effectively and make more money. We provide networking opportunities and information and advice. If there is anything you think we could help you with then give us a call.

One thing which does not change and that is that contractors have to work hard and be on their toes to both secure work and make a profit from the work that they secure.

There is a massive amount of work that is coming our way. Contractors need to ask themselves am I, my people and my business ready to both make and take the opportunities that 2017 and beyond will offer?

Do we have the professionalism, relationships, skills, expertise, resources, track record, systems and attitude to ride the wave of civil construction work that is coming?

The reality is that success is not a matter of good or bad luck, it is about being prepared to both make and take opportunities.

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