There are many reasons that led to Carillion’s descent from profit warning to liquidation in January 2018. But many question how this was allowed to happen to a key government contractor that built and maintained essential public sector services such as prisons, hospitals, schools and even power stations throughout the UK.
When Carillion ceased trading it had 1.7 billion euros of debt and up to 30,000 businesses as creditors which will, no doubt, have a knock-on effect on the public and private sectors. There are those that argue this is evidence that the construction industry’s delivery model is broken.
The culture around sub-contracting, rising costs, inflation and systematic issues of deteriorating predictability of costs, delivery times and quality means that at every level the built environment sector needs to modernise. The sector needs to move from being document-driven to data-driven. Companies that take advantage of new integrated business systems, like Enterprise Resource Planning (ERP) for example, are likely to be the successes of the future.