Focus remains on short-term cost, not long-term system benefits for commercial projects, according to exclusive Hager survey.
Many electrical commercial projects remain highly focused on initial CAPEX considerations, despite strong evidence of the system performance, functionality and efficiency benefits to be gained by taking a holistic, long-term and valued engineered view, according to the findings of a recent Hager consultation of electrical specifiers and consultants.
A selection of consultants and specifiers were asked for their views on a number of subjects including value engineering, intelligent connectivity and the impact of the Internet of Things (IOT).
Firstly, we define ‘value engineering’ as a process to assess all the components being used in a project and use this information to remove any unwanted costs. Alternative materials are then sourced and implemented as replacements to help deliver a longer life span and provide better cost effective results for the client in the future.
The vast majority (96%) said they are encountering increased pressure from their clients to ensure solutions are value engineered.
A valued engineered approach may be requested, but clients’ understanding may be different to what is perceived by the industry. Clients may want a project to be delivered at a lower cost to be completed in minimal time, rather than paying more, to then benefit in the long-term.
Market understanding of value engineering is improving according to the respondents, with 68% saying that, while there is currently a varied degree of knowledge, this is getting better.
A lack of long-term strategic investment was further highlighted with ‘the lowest purchase and installation price’ being cited by 58% as the most important aspect from the perspective of commercial clients. Encouragingly, the adoption of a longer-term view was the next most important choice when considering a project, with one in five saying ‘whole lifecycle cost’ was the primary focus of their commercial clients.
With technological advances now offering a multitude of system enhancements, the relative lack of understanding around system connectivity benefits and the ‘IOT’ is apparent. More than a third (40%) of specifiers and consultants said their commercial clients do not understand what can be achieved with each of these factors, while another 45% said they were not sure if the knowledge was widespread across the marketplace.
“More education, improved knowledge and sustained promotion of the benefits in areas such as value engineering, system connectivity and the Internet of Things can provide for commercial electrical projects, will help in this regard.”
When asked to look into the future, the respondents predicted a growing importance around system connectivity within the next five years. Nearly 80% believed ‘it will grow in importance compared to today’s level’ for end users.
Delving a little deeper into the tangible benefits that system connectivity can deliver for their clients’ commercial projects, 54% of specifiers and consultants stated that a key benefit is ‘better holistic intelligence to optimise system efficiencies and cut day-to-day running costs’. This was followed by ‘an ability for individual systems such as lighting control to communicate with other building management technologies’ (21%), and ‘access to information to make informed and strategic long-term decisions‘ at 14%.
Mike Lawerence, Commercial Market Manager for Hager said: “The findings of the consultation make very interesting reading. While clear advances have been made with new innovative technologies that can support long-term performance and lifecycle cost awareness, it still remains the case that for some, a focus on the cheapest product purchase and installation prevails. However, there is a clear belief that over time this focus will shift. More education, improved knowledge and sustained promotion of the benefits in areas such as value engineering, system connectivity and the Internet of Things can provide for commercial electrical projects, will help in this regard.
“While it is perhaps understandable that CAPEX still dominates decision-making, there should be a continued focus to push the innovation message and to spell out the efficiency and performance gains to be garnered from the technology advances being made in areas such as lighting controls, building automation and energy monitoring and metering to the end user.”