Turning Threat Into Opportunity

The strengths and weaknesses of the global engineering and construction industry are well recorded, ranging from magnificent project delivery to staggering failures. But what about the threats and opportunities? Are these well recognised and understood, especially in today’s world?

In his speech this year at Davos, Mark Carney painted a stark picture of the geopolitical situation that has degenerated significantly in the last twelve months. He said “…we are in the midst of a rupture, not a transition…” and in this context “…this rupture calls for more than adaptation. It calls for honesty about the world as it is…” and “…from the fracture, we can build something better, stronger, more just…”. Remarking upon the fluidity and uncertainty of the present geopolitical situation, the corresponding risks and the stakes of what evolves, he stated “…we are no longer relying on just the strength of our values, but also on the value of our strength…”.

The global engineering construction industry has to survive and thrive within the geopolitical situation, as eloquently portrayed by Mark Carney, if the world’s ever increasing requirements for infrastructure, housing, energy, water and sewage treatment, public facilities, transportation, etc. are to be satisfied by meeting the key objectives of delivery time limits, affordable prices and decarbonisation targets to stem the increase in global warming and its effects on societies and populations.

Reliable electricity generation is fundamental to the delivery of engineering construction projects and the long-term operation and usage of the facilities delivered. The transition from fossil fuels to ‘green technologies’ is moving at pace globally. The question is – can the development and delivery of the generation facilities match the ever-increasing demand? In this context there are at least three important points to consider:

There is an acute shortage globally of suitably qualified, skilled and experienced people in all engineering construction disciplines and functions in the respective trades and project development and delivery organisations.
There is insufficient capability and capacity in the critical supply chain to meet current demands, such that quoted delivery dates and prices are very often unreliable.
The effects of climate change on construction – research indicates that almost every construction project globally is impacted by changing weather patterns such that the benchmark upon which to realistically assess climate risk and its allocation contractually no longer exist.

However, these constraints are not confined to electricity generation projects. They affect all engineering construction projects. These, coupled with the geopolitical situation look like real and present threats to the global engineering construction industry in meeting the delivery objectives of the projects as rehearsed earlier. So how can these threats be turned into opportunities?

Honesty about the world as it is and the challenges confronting the global engineering construction industry is vital. As Mark Carney said of the geopolitical situation “…Stop invoking “rules-based international order” as though it still functions as advertised…” and “…Rather than waiting for the old order to be restored, it means creating institutions and agreements that function…”, so the engineering construction industry needs to recognise that the long-held approach to project delivery processes, practices and procedures and the corresponding contracting arrangements are often no longer fit for purpose. In particular, the benchmarks for the assessment and allocation of risk are no longer reliable. Thus, change is inevitable if projects are to be undertaken on a realistic and achievable basis, and not as a gamble.

The value of the industry’s strengths resides within the multiple skills and experiences of its people. As Mark Carney suggested in response to the geopolitical situation, “…It’s building coalitions that work…with partners who share enough common ground to act together…”. This applies equally to the engineering construction industry and was the unequivocal message from the Constructing Excellence Annual Conference on 21 January 2026.

Collaboration between project delivery stakeholders in multi-party contracting arrangements is the way forward. We know from those organisations who have embraced this approach already that it works. Collaboration provides the basis for turning threat into opportunity. The tools and implementation methodologies, as well as the induction processes for project teams are readily available.

So, what is needed for collaborative project delivery and contracting to become mainstream?

A change in mindset and a willingness to adapt out-dated practices and embrace change to forge opportunities that not only serve the project delivery participants but also the wider community stakeholders.

Do you want to gamble with your project outcomes or undertake them on a realistic and achievable basis? Why not explore the opportunities that have the potential to leverage the value of your strengths and deliver your project successfully?

John_Fotherby_Kingsfield_Academy