Standard issue

EU Infrastructure sits down with Skansa’s Petter Eiken to hear about the company’s efforts to standardise its processes and the need for greater specialisation.

“The biggest challenge is to still keep architecture attractive”
-Petter Eiken

EUINFRA. What have your key priorities been of late? What big projects have you been working on?
Petter Eiken. We have been working hard on reducing capacity. Not only reducing capacity, but also improving the efficiency of the organisation, taking out levels of administration and improving the performance. We are working hard on productivity because the productivity has not been improved in the latest year, so it's time to focus on that. One of the other important issues then is standardization, so we are - especially when it comes to residential construction, working hard on standardization. The last thing I would like to mention is the green initiative because we have to include our knowledge when it comes to lifecycle's impact, in what we are doing.

In your recent speech at the FIDIC conference in London, you spoke about Skanska's work on standardisation. What are the challenges of this process and what will its ultimate benefits be?
It's quite hard to implement standards in a construction company. People basically do what they want, so it's a huge effort, but I expect the output to be of enormous value. I think it's like the car industry if you go back to the 1920's. Every car then was different so they had a huge range of potential problems and were very expensive.  Today they are efficient, not that many defects and they are cheap.  I think it's the same thing that will happen in the construction industry, but it will take time to make it change in people's minds.

The benefit that comes to cost and quality is obvious, but I think the biggest challenge is to still keep attractive architecture so people want to buy what we are building. People don't want to buy a box.

Construction has been one of the areas hardest hit by the economic downturn. Skanska has had to make layoffs and there are apparently more coming. What sort of impact has this had on your business?
We had to lay off approximately 30 percent of the people, and it's not over yet. I think next year will be even harder than 2009, and the worst thing here is that some of these people start to leave the industry and never come back again. It we suddenly have an upswing, then we have a lack of capacity. A lot of experience is gone from the industry, which could lead back to bad productivity and bad quality. We are trying as hard as we can to keep young people, to keep the most talented people, but that's a hard job, but we are trying to do that in cooperation with the unions but it's not always that successful I have to admit.

You're currently changing your approach to leadership and looking for new types of leaders. How is this process progressing and what advantages is it bringing for the company?
We are focusing hard on diversity, and that's in fact to get rid of the hierarchical, martial type of organisation that we are used to having because in a martial organisation people don't learn from each other. Also we are hiring a lot of women these days. They have been doing that for many years, and that is to create a more diversified and more innovative organisation that is suited for young women as well as for young men.

Have there been any challenges involved in these efforts to increase diversity?
It's not hard to recruit women but it's harder to keep them. We have to careful where we put them. We have to put them together with leaders that really want to work for diversity. This is not easy. I have to admit that.

How are you at Skanska working to build more greener and more sustainable processes?  You mentioned the modular planning of the building, what are the other things that you're doing in your construction and planning processes?
We are doing a lot of small things like educating people on economical driving. You have a green toolbox on the internet with the various ideas for the sites, so it's all aspects and the bigger and smaller issues using IT tools as an indication platform.

You mention IT tools. How are you using IT to make the way you work more efficient?
When it comes to Building Information Modelling (BIM), we are demanding that of all projects that we are developing ourself.  We are controlling the whole value chain and ensuring that they use BIM as the tool in the program.  For us, it's quite obvious that BIM will revolutionise the construction industry. BIM is something that we're really pushing at the moment. We don't develop any software in Skanska.  We use standard software so that we have a global initiative driving through the company and during this year, it will be the standard tool in all self-developed projects.

Finally, what do you think Skanska's priorities are going to be over the coming years?
I think you will see an even more specialised Skanska. We used to say that we build everything everywhere, but we have to focus more on our really core competence and workflows to survive. For instance, our consultants. They can't look at things as one-off agreements. We have to make long-term commitments.

Is this a direct result of perhaps the difficult economic situation, or is it something that you think would've been happening anyway?
I think it's easier to drive change during these conditions, but the challenge is that knowledge from a project evaporates and doesn't transfer that easily to the next one, and that's something we have to solve.

Petter Eiken is President of Skanska Norway and previously held the role of Executive Vice President of Skanska AB. He is responsible for the company's construction activity in Sweden, Norway and Finland as well as being in charge of procurement and IT in the Senior Executive Team.