Innovation

The Accord continues to prioritise advanced construction ecosystems and has included a new priority on adopting digital practices and technologies to improve productivity. A number of initiatives that formerly fell under Innovation have moved to the new Construction Activator priority under Networks.

Priority: Digitalisation and the use of Technology for Productivity

The New Zealand construction sector, like most construction sectors overseas, has chronically low productivity rates. New Zealand is inhibited by its small size and scale, large number of highly specialised small businesses, and its geography. But the ingenuity, passion and attitudes of the construction sector set it apart, and we have seen early adopters of technologies such as Building Information Modelling (BIM), offsite manufacturing, digital twins and artificial intelligence.

The Accord is focussed on connecting government, industry and innovators to help innovation become mainstream, so everyone benefits from increased productivity. This is a crucial task, as there is still some confusion across government about who should take the lead on certain issues (such as the implementation of a digital twin strategy) which cut across central government, local councils and state-owned enterprises.

Industry experts have acknowledged that the business case for digitalisation is unclear, which presents a barrier to widespread investment, and that a strategic vision for digitalisation is needed to move the sector forward. The Accord is partnering with BIMinNZ and the NZ Institute of Building to develop a Construction Digital, Data Roadmap and Digital BIM, which will deliver a clear five-year roadmap and business case to increase the uptake of digital tools. This includes the development of resources for clients and designers to improve their capability for BIM and digital engineering adoption.

Priority: Advanced Construction Ecosystems

New Zealand's construction sector has been slow to innovate and adopt modern practices. The sector needs to focus on tried and tested innovation methods, including offsite manufacturing, financial tools and a supportive regulatory environment. As we move towards New Zealand’s 2030 carbon reduction requirements, the sector has a strong driver to innovate and improve the quality of the built environment.

Offsite manufacturing, in particular, is a significant opportunity for the sector to innovate and reduce the amount of resources, labour, time and carbon used in construction. On the demand side, there is growing momentum amongst procuring government agencies, with leading agencies like Kāinga Ora steadily increasing offsite delivery (from 150 units in 2022 to 450 units by end of 2023). On the supply side, there are significant delivery challenges, with offsite manufacturing often being treated like traditional construction. There is still a lack of understanding of the real value of offsite for New Zealand, which is a barrier to large-scale investment.

To address these challenges, the Accord is convening two Modern Methods of Construction forums - one for government and one for industry, with both working in parallel towards the same objective of increasing the uptake of offsite manufacturing. The government group was developed in response to the Commerce Commission's recommendation that Government should develop and implement an all-of-government strategy to coordinate and boost offsite manufacturing(external link)  - comcom.govt. The government group will focus on developing an all-of-government approach to increase the adoption of offsite manufacturing in Crown infrastructure projects. The industry working group, which the Accord is co-leading with OffsiteNZ, will develop the tools and resources needed across the supply chain to enable interoperability, design standardisation, market capability, and skills and training, while minimizing risks and addressing any challenges that may arise.

Next Steps

Over the coming year, the Accord will expand its innovation work programme to look at digital approaches and consenting to ensure that digital programmes across government are aiming towards the same north star. The Accord will have a renewed focus on knowledge sharing and will partner with industry associations to increase their focus on innovation. We will also explore gaps in financing and funding to support new and innovative ideas. The Accord will scope the Study Tours initiative and the residential sector reference group will look into developing the Innovation Focused Non-Regulatory Reform and Financial Innovation initiatives.