Volatility is no longer a short term condition but a structural shift and signals a complete change in director for the built environment. Here RLB’s Chief Executive of UK and Europe, Andrew Reynolds talks to Building magazine about how adaptability is the key to resilience.
We will be expecting a new Prime Minister in the next few weeks. This will be the fifth in as many years. Meanwhile, I attended RLB’s Global Board meeting, where I met colleagues around the world to discuss opportunities and challenges in our markets, across our regions. As I travelled home, it occurred to me that the level of change, of uncertainty happening both at home and on the world stage, is now our normality.
Uncertainty in our markets is not temporary, but it signals a complete change in direction for the industry.
Across the market, pressure is coming from several directions at once. Consumer price inflation may have eased from its peak, but tender prices are nudging upwards. Supply chain appetite is more selective, and investors are testing viability more thoroughly. Regulation and policy are changing often against tighter financial and operational constraints. The Volatility Index, the global standardised measure of market volatility, is at its highest it has been since 2016, and the level of trade through “friend-shoring”- choosing to route trade through aligned or friendly nations – has risen from 18% in 2018 to 38% in 2026.
A change in PM is also likely to bring renewed emphasis on devolution and place-based growth. For construction, that could mean navigating a more localised policy landscape while still responding to global pressures around capital, materials, energy and security. That does not make resilience easier, but it makes adaptability even more important.
Resilience means adapting
For many years, the industry has managed uncertainty through contracts, contingencies and commercial protection. Those tools will always have a role, but in a market that is moving quickly, resilience cannot only mean passing risk along the chain or pricing every unknown.
The proposed ban on retentions is one example. Whilst the legislation is still to clear parliament, the direction of travel has been set for some time. The industry is being asked to move away from relying on withheld cash as a form of assurance and towards better ways of managing performance, quality and accountability from the outset.
It also creates an opportunity to think more carefully about the behaviours we want to encourage. If quality, certainty and delivery performance are the aim, then they need to be built into how projects are procured and managed, not corrected at the end.
Adaptability to achieve outcomes
Clients need to understand how their procurement strategies are being received by the market. Contractors are already becoming more selective about the work they pursue. Supply chains are looking harder at governance, risk transfer and the strength of project information before committing. Professional teams have a role in helping all parties understand what is deliverable, not just what is desirable.
Business discipline does not mean sitting and waiting
Volatile markets tend to expose weak points. They test assumptions, commercial discipline and the quality of relationships across the project teams. They can also reward those who are prepared to think differently, and the organisations best placed for the next phase of the market will be those that combine engaged awareness with constructive action. They will thrive by proactively managing risk but not becoming paralysed by it. They will use technology but not lose human judgement. They will respond to policy but not wait for regulation to tell them how to improve.
Construction has always been an industry that adapts. It responds to new materials, new methods, new regulation and new client needs. The difference now is the pace and combination of change. With political change, greater devolution and continuing global uncertainty all in play, the industry will need to become more comfortable operating across different layers of risk and opportunity.
Volatility is not going away, and the industry cannot control every external pressure, but it can control how well prepared it is to respond. In my view, resilience in this market will not be defined by those who wait for stability to return. It will be defined by those who can embrace the opportunity, adapt quickly, adjust thoughtfully and continue to deliver with confidence.
This is an abridged article which first appeared in Building: In a volatile market, resilience means knowing how to adapt | Comment | Building
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