Post-Fordism and the Construction Industry

POST-FORDISM AND THE CONSTRUCTION INDUSTRY

Acar, E.; Sey, Y.

Summary

The term post-Fordism, represents a popular arena of academic discussions of the recent years; it concentrates on flexibility and technological innovation in order to describe the change in the technical and the social dimensions of production, particularly in the manufacture industry. The construction industry, on the other hand, has usually been an importer of the production and management techniques of the manufacture industry; its well-known special aspects such as the fragmented structure, and the unqualified labor composition have been used to explain why the construction industry generally has a slow response time to adopt and adapt those new techniques. However, the construction industry already embodies some instruments that provide a high level of flexibility both in production and management processes, such as the sub-contracting mechanism and locality, and small batch production. So, the problem appears to develop a realist strategy that considers the persistent problems of the industry and decrease the “tensions” that are assumed to exist within the industry, in order to adapt to the post-Fordist environment.

Introduction

...and a time may well come when automation, the use of computers, critical path analysis, work study, tower cranes, spray guns, and cellular plastics may be common in this industry throughout the world... (1, p.230)

Mention should, perhaps, also be made of the possibility of the peaceful use of nuclear explosives for massive earth-moving operations… (1, p.231)

The first citation seems to confirm Albert Einstein, who emphasised that the science and technology would not advance so much if we did not have dreams. However, does not the second citation point to the necessity that enthusiastic developments in science and technology should be interpreted with caution? The projections for the near future suggest that technology-intensive (particularly the microelectronics) production and management systems will play a significant role to meet the needs of the construction industry. Nevertheless, improving performance in building construction through the import of the production and management techniques of the manufacture industry, has always been a problematical task because of the special aspects of the product (the building), production process, and the market; particularly the building construction industry usually has difficulty to adopt and provide the wide-spread use of those imported techniques. The central question appears just here: If “full automation”, “information technology”, and the similar concepts are representing the signals of a forthcoming production paradigm, how should the construction industry response to some next-door changes when its well-known inherent problems are considered?

The manufacture industry, on the other hand, has been questioning the mass production system (the so-called Fordism) since the 1970s. It was argued, why a well working production system since the Second World War found itself in a crisis. The question was simple: had the Fordist system completed its mission? The concepts like new Fordism, flexible specialisation, or post-Fordism represent the headings of different answers given to that question. Whatever the heading is, most commentators agreed that the technical and the social organisation of the Fordist system needed a revision to gain more flexibility both in production and the management processes. The post-Fordism, which “…involved changes in the vertical division of labor, an emphasis on product innovation, improved design capability, relations with suppliers and responsiveness to local markets…” (2, p.143), differed from the others, for it gave a special emphasis to technological innovation.

This study aims to question the position of construction industry in a world of accelerated change, with a special attention to its past and, interpret how the post-Fordist developments should be evaluated for its near future. This study argues that the dual structure of the construction industry (traditional, together with the non-traditional) is creating a tension to be overcome, in order to respond to the innovative pressure of the post-Fordist environment.

Transition from Fordism to post-Fordism

The assembly line, introduced by Henry Ford during the years of the First World War, provided rapid increases in productivity (3, p.12). It meant a radical transformation both in the technical and the social organisation of production. On the one hand, special machines, designed to produce single types of products on the assembly line, permitted the coordination of different production activities with varying rhythms; thus “…it was possible to produce large amounts of standardised products, that created the technical conditions of the mass production” (4, p.44). On the other hand, Fordist production required the refinement of the labor from his traditional skills; “…Once the deskilling had been achieved, the development of the assembly line was almost a formality,” Clark argues (5, p.17). The post-war period from 1945 to 1970 provided the appropriate macroeconomic and macro political climate for the success of the Fordist production system (See 6 and 7 for detailed analyses). The interpretation of the economic, social, and the technical reasons of the crisis of the Fordist system is beyond the purpose of this study; nevertheless, most commentators agree that the rigidity embodied in the Fordist system was one of the major reasons. Rapid development of information technologies, fragmentation of markets, as well as the change in global-political conditions accelerated the crisis of the dominant production paradigm of the century.

For many, flexibility was the magic drug to overcome the crisis of Fordism; however, Amongst many definitions of flexibility, Harvey (8, pp.87-88) allows a clear understanding; he proposes four categories of flexibility: The first, the labor flexibility, comprises the numerical and the functional flexibility of labour: Numerical flexibility is the ability of an organisation to adjust the number of workers in respect to changing demand conditions; whereas, functional flexibility is the organisation’s capacity to assign workers for different tasks and occupations. The second category is the labor market flexibility that is the increase in number of instruments, which ease the mobility of labor among the different sectors of the economy, such as the sub-contracting and part-time employment. The third category of flexibility, associated with state policies, comprises the institutional regulations that ease the mobility of capital. Geographical mobility is the other category of flexibility, comprising both the regional (i.e. the home-offices) and the global-geographical (i.e. assembly of a product in different countries far from each other) flexibility of capital. The microelectronics-based automation technologies play a special role in providing flexibility, since they are regarded as the major instruments of the integration of production processes in a highly fluctuating environment. Thus, economics of scale is replaced by the economics of scope and, computerised machines, which integrate the production process from design to marketing phases, primarily provide this- “the flexible integration” (9, p.33)

Post-Fordism, is proposed as the solution to the rigidity of Fordism; it is seen as “socio-economic and political structures connected to basic technologies, which enable sustainable economic growth” (9, p.31). Table.1 displays the basic differences of Fordism and post-Fordism. Available literature on the discussion direct attention to the point that the post-Fordist process will be most effective on the labor process through the intensive use of microelectronics technology, creating a distinction of core and the periphery workers.

The core workers use programmable machinery and they can move between tasks. Their production is therefore flexible with respect to product range, thus enabling the short-run production of varied products at relatively low cost. They have secure employment contracts. The peripheral workforce may or may not use advanced machinery, but, at any rate, they tend to be less skilled than core workers. Their production includes both the ‘remaining’ production of standardised products and the overflows of work from the core during the peaks in demand. Their employment contracts are insecure…(9, p.33).

In contrast to the deskilling process of Fordism, post-Fordism calls for the re-skilling of labor in order to get benefit of the computerised and complicated machines. This is why Gough (9, p.34) and many other writers comment, “the new craft worker is born.”

Table 1. Contrasts between Fordism and post-Fordism[1]

FORDIST PRODUCTION / JUST-IN-TIME PRODUCTION

A. The production process

- Mass production of homogenous goods / - Small batch production
- Uniformity and standardisation / - Flexible and small batch production of a variety of product types
- Testing quality ex-post (rejects and errors detected late) / - Quality control part of process (immediate detection of errors)
- Rejects are concealed in buffer stocks / - Immediate reject of defective parts
- Loss of production time because of long set-up times, defective parts, inventory bottlenecks etc. / - Reduction of lost time, diminishing the porosity of the working day
- Resource driven / - Demand driven
- Vertical and (in some cases) horizontal integration / - (Quasi-) vertical integration sub-contracting
- Cost reduction through wage control / -Learning-by-doing integrated in long-term planning

B. Labor

- Single task performance by worker / - Multiple tasks
- Payment per rate (based on job design criteria) / - Personal payment (detailed bonus system)
- High degree of job specialisation / - Elimination of job demarcation
- No or only little on-the-job training / - Long on-the-job training
- Vertical labour organisation / - More horizontal labour organisation
- No learning experience / - On-the-job learning
-Emphasis on diminishing worker’s responsibility (disciplining of labour force) / - Emphasis on worker’s co-responsibility
- No job security / - High employment security for core workers…No job security and poor labour conditions for temporary workers.

C. Inter-firm relationships

-Formal relationships

/

-Informal and oral relationships due to mutual trust

-Exclusive R&D

/

-Joint R&D departments, networks to get benefit of new information and inventions

D. Space

-Functional spatial specialisation (centralisation / decentralisation) / - Spatial clustering and agglomeration
- Spatial division of labour / - Spatial integration
- Homogenisation of regional labour markets (spatially segmented labour markets) / - Labour market diversification (in-place labour market segmentation)
- World-wide sourcing of components and subcontractors / - Spatial proximity of vertically quasi integrated firms

Source: Harvey (7, pp.177-9) Original source: Swyngedouw E. (10).and, Eraydın (11, p.28) for inter-firm relationships.

The table above, originally, includes the sub-headings state and the ideology. The post modernity, defined as the “legalisation of what the modernism has forbidden,” (12, p.1506) represents the complicated ideological background of this discussion.

The construction industry: persistent problems, changing faces

The potential for change to achieve a better performance in building construction industry cannot be evaluated, unless the industry’s problem areas are identified. A comparison between the current and the previous literature could help distinguish those areas in which the construction industry has persistent problems. For this purpose, some detailed reports about the industry, one of which was prepared by the International Labor Organisation (ILO) in 1965 (1), and, the others by European Communities (13) and WS Atkins International Ltd. (14) in 1990s, were evaluated together. Several common complaints depicted in those reports help us to clarify (or remember?) some of the areas of resistance to change, for approximately more than thirty years of the construction industry:

The multi-disciplinary nature of the construction industry has been the primary obstacle for the integration of control processes and the diffusion of new inventions and techniques throughout the industry; since the coordination of innumerable disciplines requires a complicated effort.[2]; small and medium-sized enterprises (SMEs) dominate the industry. This dominance calls for continuous attention to the traditional production techniques, along with the efforts to industrialise the building construction[3]; the industry invests little in research and development(R&D)[4]; the industry has a bad image in the eyes of its customers and the persons within the industry and this has been closely related with the unpleasant conditions of work;[5] the customer of the industry is not familiar with the production process- this, on the one hand, makes the customer vulnerable and, on the other hand, makes finding a common language between the customer and the construction professionals difficult; the industry has for many years been regarded as an employment pool for unqualified labour for many years; the use of unqualified labour constituted a barrier for the diffusion of new techniques and technologies; the industry invests little in intellectual capital; the “nomadic” structure of the labour is one of the primary reasons for the inadequate investment in human resources; the “cut-throat” competition among the firms causes problems of quality; and the like.

Besides the persistent problems of the construction industry, some of which are listed above, there has been a lot that have changed technologically since 1950s. A short summary taken from the Atkins report outlines those technological changes, particularly in the building materials industry: “Materials: lower cost and higher performance steels; light-weight, quick-curing, and specialist concretes, and growth of ready mixed concrete; low cost high quality float glass and strengthened glasses; use of plastics such as uPVC, lower cost aluminium; new adhesives creating better laminates and particle boards; improved and more extensive use of machinery both on site and in the manufacture of materials and components; development of many prefabrication systems, particularly cladding systems using glass, synthetic stone or composite materials; and more extensive factory production of subsystems and components; improved building services and controls and the beginning of the development of intelligent buildings; building design changes to cater for IT, telecoms and cabling in buildings; application of CAD, now becoming widespread; tunneling technology; new structural solutions, such as structural glass, lightweight suspended structures, longer span bridges” (14, p.7-1).

The building construction industry, which has long seen the mass production system as the solution to its persistent problems, could not achieve an adequate performance, compared to building materials industry. The problem then appears to discuss whether the post-Fordist production and management techniques can provide the desired performance in building construction industry or not.

What do the post-Fordist developments mean for the construction industry?

The following (part) of the study is constructed to make a general analysis of the post-Fordist developments, rather than comparing each post-Fordist criterion (listed in Table.1) to the construction industry, which requires carefully designed empirical studies). This study argues that two basic tension points deserve attention in order to interpret the effects of a post-Fordist environment on the construction industry: The first is assumed to exist between the construction industry and its end-user, whereas, the second, derives from the traditional side of the construction industry, which appears to be a barrier to the innovation in the construction industry.

Whether defined as “post-Fordist” or not, recent technological developments necessitate customer-oriented approaches in production, not only because of the change in the perception of time and space, but also because of the fragmentation of markets, continuous demand for product innovation, and the like. However, it is not an exaggeration, perhaps, to claim that construction industry’s end-user does not understand the complicated construction process and the product (the building) except its surfaces (such as the ceramic finishes). The industry’s perception of quality is mostly different from its end-users’. The unfamiliarity with the industry, together with the easy entry of small and medium sized enterprises and “cut-throat” competition, make the end-users of the industry vulnerable and create a necessity for their protection.

The second dimension of the tension between the end-user and the industry derives from the observed responsibility of the construction industry for the ecological deterioration of physical environment: The industry has an obligation to revise the traditional life cycle approach through the sustainability criteria including recycling and re-use (R&R) activities. The seeking to solve “general” problems through “local” approaches increases the tension between the industry and its end-user; the informal housing problem in Istanbul represents a good example in this sense: The R&R activities, which have been out of the priorities of the industry until recently, appear to have a direct relationship with the informal housing industry: The second hand building materials, which are collected from the deconstructed or demolished buildings, constitute a considerable secondary market that serve immigrants to the city (17, p.80). Whether the robotics technology is employed or not in construction sites to build the large shopping centres of Istanbul means little, when the scale of this informal mechanism is considered.