Pestle Analysis Construction

John O’Donnell Gallagher Construction and Development are based in north London. They are a property development and refurbishment company. They have been in the construction industry for about twenty five years. They have a workforce of twenty directly employed and about fifty self employed workers at the moment.

The major political influences on the construction industry in London at the moment are the Mayor of London’s Sustainable Design and Construction Supplementary Planning Guidance to the London Plan, the Climate Change Action Plan, and the Governments lack of response to the effects of the recession.

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The recession has almost completely stopped the building of new houses and has led to the mothballing of most of the commercial developments planed for the capital. This means that the only sector in construction that has any work is the refurbishing sector. The effect of this for Gallagher’s is fierce completion for contracts and price-cutting to stay competitive which has very negative long term implications for the growth of the company.

The implications of the Mayors initiative regarding the Climate Change Action Plan is that there work must comply with BREEM which sets and maintains a robust technical standard for construction work and have there work assessed so that the environmental impact of the work can be awarded an overall rating. This has impacts on time, cost and construction methods for tightly priced contracts.

The economic environment for construction business in London at the moment is not good due to the recession. Even though the development for the 2012 Olympics is well under way, there are still a large number of construction workers unemployed.

The Credit Crunch for Gallagher’s, who traditionally bought and refurbished buildings and then sold them on, as well as taking on contracts from a number of property development clients, has changed the nature of there business in two ways. One, most of there refurbishing work is now done in social housing, for Decent Homes contractors and the other is that because of the drop in house prices in 2008 Gallagher’s were left with a number of properties that could not be sold on at a profit therefore they have had to rent these properties out.

This means dealing with tenants and being responsible for repairs and maintenance of these properties.

The Decent Homes work also is different in that a lot of the properties that they have to work in are occupied and therefore the risks and responsibilities are different which means that there insurance costs have gone up and they have got to vet there employees with the Criminal Records Bureau at more cost. (2) Like most organizations Gallagher’s is organized on a hierarchical basis.

Its management style is fair but firm; orders come from the top and should be carried out with only a minimum of questioning where necessary. ” The Considerate Constructors Scheme is the national initiative, set up by the construction industry, to improve its image. Sites and companies that register with the Scheme sign up and are monitored against a Code of Considerate Practice, designed to encourage best practice beyond statutory requirements. The Scheme is concerned about any area of construction activity that may have a direct or indirect impact on the image of the industry as a whole.

The main areas of concern fall into three main categories: the environment, the workforce and the general public. ” The Scheme logo which can be see on so many site hoardings shows that the company cares about the local community that they operate in, and are committed to the Scheme’s ‘‘Code of Considerate Practice”. That sends a strong, positive message to the community as a whole, and reflects a good practice approach that is recommended to all construction businesses.

Gallagher’s response to the technological environment created by the initiative regarding the Climate Change Action Plan was to install Carbon Accounting computer software in there head office which establishes the carbon emission baseline covering all aspects of the business. This includes carbon management and it also helps to prepare there report in keeping with there Carbon Reduction Commitment. The Company that installed this software also trained those responsible in the office how to use it.

Green building encompasses everything from the choice of building materials to where a building is located.

At the moment Gallagher’s are finding that converting roofs so that solar energy panels can be installed requires operatives with skill and experience levels that are above the average, they are dealing with this by advertising for people with those particular skill sets. The future for green technology will include the development of apparatus and fuels so that the means of generating energy by the individual at home will become the norm, so Gallagher’s are forward planning to set up arrangements with the companies who make these apparatus to run short training courses for there operatives.

The construction industry is governed by the Building Regulations, which is a statutory instrument which gives the government or local government authority to regulate the construction of buildings. This is supported by approved documents prepared by the office of the deputy Prime Minister, approved by the Secretary of State and issued by the Stationery Office to give practical guidance to contractors when complying with the various regulations.

The Construction Design and Management Regulations 2007 which regulate the Health and Safety aspect of the construction industry.

All of these regulations have legal powers to back them and must be adhered to by Gallagher’s and everyone else in the construction industry. (3) All of the top management at Gallagher’s Construction are, either fellows or members of professional bodies such as The Charted Institute of Builders. They are totally committed to Business and Professional Ethics.

If there are any complaints about the quality of the materials used or the workmanship or behavior of their employees or sub-contractors there is an immediate investigation and if it is proved that any wrong has been done it will be rectified immediately and the person responsible will be dealt with according to company policy.