BRENDAN MORAHAN, director of the Invennt construction advisory firm, has his finger on the pulse of an industry that is in flux in both Ireland and the UK.
As an industry leading expert with decades of experience in the construction sector on both sides of the Irish Sea, Brendan speaks to challenges each industry must address in 2021.
Firstly, while the eleventh-hour deal struck between Brussels and Westminster last December offered businesses some reassurance, Brendan is conscious that the regulatory ramifications of Brexit will have a “long tail”.
Accessing increasingly elusive finance, championing innovation, and perhaps above all – as Brendan says, a business is the net sum of its people – ensuring that the industry can continue to attract and retain top talent, will have to be at the top of construction executives’ agendas as the sector emerges into a post-pandemic environment.
Lockdowns have been roundly detrimental to the sector in both countries; the Irish sector alone, coming under harsher restrictions, is expected to lose around €3 billion in revenue.
On top of this, despite being an optimist, Brendan is realistic about the costs of the pandemic, and the knock-on effect it will have on corporate taxes.
Now, more than ever, therefore, it is crucial for businesses to stress test for the financial challenges that lie ahead.
First and foremost, Brendan says, “finance is absolutely fundamental”.
He explains: “We are an industry that has traditionally and largely been undercapitalised, and as a consequence it has always been subject to the vagaries of economic cycles and hasn’t always been efficient in investing in new technologies and innovations – and there are very good reasons for that because of the margins they often operate under.”
One vast and under-tapped reservoir of potential funds is the government R&D tax credits on offer in both Ireland and the UK.
Not only do these credits give businesses generous cash injections, they incentivise the kind of change that will make firms more durable in the long-term and offer a useful health warning to those that don’t qualify.
In addition to helping businesses navigate new regulatory environments, Invennt seeks to “analyse organisations to identify where they have, if not unique, certainly particular strengths in comparison to the market generally and most particularly to their competitors”, Brendan says.
Typically, Brendan finds that “a lot of companies have either started off quite small and grown quite quickly almost to their own surprise and have got to a level without a detailed strategy and have suddenly hit a point at which they don’t really know how to take it to another level, making them vulnerable”.
On the other hand, Brendan says, there are “other businesses that have been around for a long time who have a strategy on paper, but it hasn’t really been tested and prodded and probed to check that its fit for purpose”.
“One of the mantras were always pushing with our clients and prospective clients is to really look hard at what your strategy is and how you are going to compete now, and in the future, and we obviously seek to provide help with that, by stimulating that debate and independently critiquing what they come up with.
“I think that’s really important for two reasons, one is it then makes you more attractive if you’re seeking debt or equity because you clearly have a vision and a plan that can be articulated that people can buy into and back.”
Ultimately, Brendan’s main focus is helping firms in “delivering your business effectively”, which, he says, may “sound obvious”, but “quite often we get involved in businesses and when we start to get under the bonnet, you find that they’re doing work, but not very successfully, and unsurprisingly because they’ve won the sort of work that they should never have really been going for”.
Invennt is committed to providing businesses with more than a one-off health check: it seeks to create systems that will give businesses the tools to course correct at a pace that is commensurate with the fast-changing sector and economy more broadly.
“What we always say is that busines health check isn’t just a point in time”, Brendan says, this is a data-led system to monitor progress, give feedback, and affect change in real time.
“Most of the businesses that we now work with have no shortage of data, but a lot of that data is not really usable, so we are developing a tool to help clients identify what data they need, how they can capture that and turn it into a meaningful dashboard.
“So, if it’s going to plan, they keep going, if it’s not, they know they need to do something about it.”
The challenges of the 21st century loom large, whether it be tackling climate change, building affordable and efficient infrastructure to support fast-growing, and ageing, societies, or simply making places more liveable for the people that live in them – the task ahead of the construction industry is monumental.
But, with the right tools and attitude, Brendan is convinced that the sector can not only rise to meet these challenges, but use them as opportunities to grow, create new practices, and positively thrive in doing so.
On an optimistic note, Brendan adds: “This has been a difficult time and people need better spaces, they need better built environments, to live, work, play in, and I think we’ve got an opportunity now at a macro level for countries to look at how they grow out of this, and you’ll grow out of it on the back of construction”.
If your construction business could benefit from an injection of capital or a fresh perspective on your corporate strategy, contact Brendan on 07816 514505 or [email protected], or click here for more information