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Government grants go untouched as construction firms are slow to innovate and diversify new research finds

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Government grants available to help construction companies innovate and diversify are not being applied for, according to new research published by Constructionline and Capita Symonds today. More than 80% of construction firms are unaware grants are available to support innovation and only 4.1% of construction companies have actually applied for grants.


The survey, based on responses from nearly 400 firms, ranging from architects to engineers and main contractors, asked a series of questions designed to gauge the construction industry’s appetite for innovation, diversification and research and development (R&D). Firms answered individual questions but were also given an overall score (out of a possible 33 points); the highest overall score was 26 with just 3.5 per cent of respondents scoring 20 or above and the average 10.31.

Compared to architects and engineers, contractors are the least innovative overall (9.7 points average), suffer the lowest levels of R&D spend; the lowest levels of awareness of government funding stream and are least likely to diversify their services.

Philip Prince, sales and marketing director at Constructionline, said: “According to our research, last year’s annual spend on R&D was around £66,250 among high scoring (20 points plus) firms, but just less than £16,000 on average. In addition, more than eight out of 10 construction firms were not aware of funding for innovation, including schemes like Technology Strategy Board grants, Knowledge Transfer Partnerships and R&D tax relief.

“The news on diversification was healthier, however, with 63 per cent of firms having diversified their services and 71% having a defined approach to the development of new ideas. Unsurprisingly, however, there were strong links between the likelihood of a company to diversity and innovate with a mean innovation score of 11.9 among those who had diversified and 7.6 among those who hadn’t.”

Richard McWilliams, director of innovation at Capita Symonds, which co-sponsored the survey, said: “Innovation is vital for economic growth and, with an ever increasing frequency, buyers are seeking an innovative approach to ensure continuous improvement and more cost effective products, processes and services from the supply chain. Often, this translates into a requirement within tender questions for bidders to demonstrate how they are innovating. A handful of companies thrive on an opportunity to broadcast their cutting edge approach, but for many, it prompts a troublesome scrabble for a response that fits the bill.”

Matt James, associate director at Capita Symonds has been assisting construction sector companies to respond to changing market challenges, design and develop new solutions and improve their current services. He added: “Companies are looking at ways in which they can overcome some of the key issues – time, resource, capability, focus and finance – that can prevent or limit research and development or service improvement activities. The key is looking at the entire process – from trend spotting and in-depth market research at the outset, all the way through to funding – including R&D tax relief, expertise – through to product or service launch and commercial exploitation.”

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