International business from wood construction expertise

Tekes, the Finnish Funding Agency for Technology and Innovation, is currently conducting several programmes aimed at the development of the construction business. ”Tekes’ interest in being involved in the development of the wood construction business is to find diversity for building, says Reijo Kangas, Director of Real Estate and Construction Industries. The common denominators of these programmes are energy-efficiency, ecology and services enabled by digital information technology. According to Kangas, Tekes is aiming to grasp the systemic change currently underway in construction, and to promote the access to markets of new innovations and construction service production.

In Finland, the construction industry’s share of GDP is large at 12-15%, whilst the average for Western Europe is less than 10%. This difference can be explained by the migration from rural areas to growth centres that is still taking place and the structural change related to it. Finland will need about 30,000 new homes every year for the next two decades. Most of these new homes will be built in the capital region and at other growth centres." From a point of view of economic policy, the development of the wood products industry may bring replacement job opportunities to areas that have lost them as a result of structural change in the forest industry, and correspondingly the new innovations of wood construction will bring new business to areas where such construction is taking place,” says Kangas.

Construction also has a direct impact on Finland’s GDP, which rises or falls in relation to the economic conditions in the construction industry. ”Because of this, an improvement in the productivity of construction is an economic matter for Finland. If its productivity improves, so does GDP,” he explains.

New innovations required for the construction market

”The interesting things about wood construction are its speed, efficiency and diversity. For example, the Innova project carried out in Riihimäki should not be seen merely as the renovation of the facades of old apartment buildings, but also as a total customer-centred energy improvement project that improved the technology in the buildings and moved jobs from building sites to factories,” says Kangas.

Kangas thinks that the Innova project is an example of industrial repair construction, which combined the digital process of measurement based on laser-scanning with prefabricated production done in factories and with the installation of building technology. He also thinks that the Innova project is a good example of the upgraded range of services offered by the construction sector.    

The common denominators of the Tekes programmes are energy-efficiency, ecology and services enabled by digital information technology. According to Kangas, the programmes are aiming to grasp the systemic change currently underway in construction, and to promote the access to markets of new innovations.

”It is already evident that, in the future, the importance of materials will also increase in construction,” says Kangas. ”The competitiveness of wood is based on the ecology of its construction process and on its efficiency. Wood is a light and flexible building material, especially as its industrial prefabrication is increasing and work is shifting from the building site to the factory. Industrial wood construction is customer-centred and comprehensive. The open standard of wood construction is a good thing, but it must be further developed. We should not just be satisfied with copying it from other sectors. Building technology and energy solutions, for instance, must be included in it, as should efficient production processes, which have been developed in, for example, the electronics and automotive industries.”

A customer-centred range of services for the construction industry

In Kangas’ opinion, one aim of the Tekes programmes is to understand the needs of the customers of the construction industry. ”The customer does not actually have a need for wood as a building material. He just needs a more productive and efficient construction process and, above all, efficient and comfortable homes and offices. We must consider what the critical customer and investor truly want,” says Kangas.

”A sustainable society is based on its level of eco-efficiency, which can also be improved through public procurements and taken as a principle of such procurements,” suggests Kangas. ”The public sector could thus be a pioneer and a showcase for the reform of the entire sector." Finland needs such opportunities to show off its construction innovations and expertise.”

International business from construction expertise

Kangas is looking for service providers to develop the construction sector, combiners, integrators of expertise. ”The basis of future competitiveness will lie in the fact that we are able to combine our existing strengths in construction, such as design, building technology, materials, the exploitation of information technology and logistics in construction and industrial prefabrication,” says Kangas. ”Now we need innovative integrators, who can combine different services and products for the customers.”

Kangas thinks that the construction service package of the future will consist of several different products such as design and the operating logistics of construction. ”Finland may be a future global pioneer of construction, which has international business and not just export. We have always been internationally successful in the construction business, through companies like Kone and Halton, and Vahanen Group and PES-Architects from the service sector. At the core of international business may also be expertise in construction services at a concept level and its application to different markets.”

Kangas sees the international market for construction as lying in Russia and towards the south. ”The work being done for wood construction is not only for the domestic market, but must also be for international markets," says Kangas. ”Expertise in different fields of construction does not need to be merely local. It can also be global. This requires an understanding of customer needs and new business models for the construction of the ‘Finland’ brand.

Good architecture part of the competitiveness of construction

Kangas believes that the construction sector should be involved in the Cleantech Finland project, because that is where a harmonised and sustainable national brand is being created. The real estate and construction sector is one part of this whole. "The greatest problem of Finnish architecture lies in the fact that we have been doing the same thing for a long time, and have not dared to do anything different. In the same way, the importance of public control in the end result has been significant.”

”Good architecture is part of the ecological competitiveness of construction, and the better living environment that it creates,” says Kangas. ”Now that there have been global studies of how people experience different spaces, nowadays much emphasis is put on ecology. Space is also remembered as an experience, so in future there will be demand for ‘wow’ architecture, that is to say spaces and buildings that really make an impression.”

Puuinfo article service/Markku Laukkanen

More information:

Reijo Kangas, Director of Real Estate and Construction Industries, TEKES, +358 (0)50 5577 892,