Here we go! The Liftrock holding structure, which comprises five companies – Contract Management Czech Republic, Contract Management Slovakia, Quality Management, Proconom Software and Techpro management – has entered the construction market. We will be told about its origins, goals and philosophy by the people who know the most – its three main managers: the holding organisation’s CEO Václav Větrovský, the holding organisation’s chief economist Michal Hlavnička and Martin Sklenář, who is primarily responsible for digitalisation in the holding organisation.
Gentlemen, all three of you have been in the construction industry for a long time. How would you briefly describe the Czech construction industry?
VV: In general, the construction industry is one of the fundamental pillars of every economy in developed Western countries. This is, of course, no different in the case of the Czech Republic. The construction industry in the Czech Republic is a very traditional industry where, unfortunately, not much has changed in the last 30 years. The procedures and processes for both the preparation and the implementation of construction are de facto the same. But now we are on the threshold of a revolution, a huge opportunity. Meaning digitalisation.
What is the current level of digitalisation in the Czech construction industry?
MS: Although digitalisation is a topic that is important in the world today, the construction industry remains, in my experience, somewhat in the analogue era. Digitalisation is entering the construction industry very slowly. And it is striking that this is the state of the industry even at a time when the preparation of the BIM (Building Information Management) Act is in full swing.
What do you think are the barriers and reasons the construction industry is still not digitised?
MS: It’s clearly fear of everything new; unfortunately, that’s how it works in the construction industry.
Digitalisation, however, also brings opportunities. What are the biggest ones?
MS: A digitalised construction industry provides us with huge opportunities. The most fundamental is the availability of current information about the construction industry, which is a necessary condition for high-quality project management. This is clearly an improvement in the effectiveness of preparation and realisation of construction work.
What do you perceive as the biggest problem in the Czech construction industry?
VV: The biggest problem in the construction industry in the Czech Republic, as a field, is its absolute lack of attractiveness for the “new” generation. At the current time, we are witnesses to this absolute absence of incoming people, workers and students in the field. This makes impossible the natural generational changeover, natural monitoring and implementation of the latest trends in the field. This is one of the reasons the field is behind the times – which is a problem.
MH: From my viewpoint I see a problem primarily in the appetite to change things. Because the construction industry is very traditional, the aversion to change is quite high. But gradually that approach is changing and the need to work with data, digitisation and new practices is increasing across the industry.
On the contrary, what are the positives in the Czech construction industry?
MH: The construction industry has a long-standing advantage in stability. Trends on the market are upward, despite the significantly influencing factors (e.g. increasing inputs due to the war in Ukraine, a higher base interest rate and resulting more expensive financing). So I would say that healthy companies manage to grow despite adverse market influences.
You say that there is a lack of digitalisation in the Czech construction industry and a decline in the sector’s attractiveness. The mission of the newly established holding organisation is to cultivate the entire construction market. How do you want to cultivate the Czech construction industry?
VV: Clear support for the introduction of systematisation, new trends, digitisation, FIDIC contract templates for the management of construction projects. All these steps will clearly contribute to the transparency of our sector, increase its attractiveness and ultimately improve the construction industry’s reputation in the Czech Republic.
The mission of the oldest company in the holding structure, Contract Management, a.s., is to implement standards of consulting engineering and construction project management, which are complex operations. What are the most complex activities in terms of construction work?
VV: We are trying to introduce new trends and modern methods into the process of managing construction orders and project management. The most complicated thing is to convince our partners to change their established procedures, with the help of the new rules. The second complicated topic is digitalisation of construction projects, which is currently not something wanted by public clients – although it will paradoxically be mandatory in a couple of years.
MH: Our mission to change the construction market has one very clear need, which is human capital. To make a difference, we need quality and motivated people with good professional credentials. This costs effort and time, which is a very expensive commodity today. Through this lens, it is obvious that the best tool or system cannot work without the right person.
Cost management is one of the services offered by the company. What does this term mean and what processes does it include?
MH: It means fundamental activities concerning prices and valuations. A cost manager can pay attention to checking and controlling costs incurred during the performance of a contract. In addition, he deals with their correct valuation in accordance with valid methodologies. His job includes managing alterations to prices (index-linking).
There is a new entity on the Czech construction market – the Liftrock holding structure. How was the idea to set it up born?
VV: I’m the owner of several companies doing business in various sectors in two European countries (the Czech Republic and Slovakia). They employ a total of 110 people. The aim of the Liftrock holding structure is to deepen cooperation between individual companies, as well as between people in the individual companies. In addition, when one of our watchwords is “transparency”, we have to be transparent. The holding organisation makes the whole asset structure and focuses of the companies, as well as the processes in them, much more transparent.
In what way is this holding structure beneficial for all four companies?
VV: There is strength in unity and cooperation. The holding structure’s main aim is to strengthen cooperation between the individual companies. Although every company has a unique product, know-how and identity, close and effective cooperation between the companies gives us an advantage over the competition.
MH: In general, this step prepares a platform that should create synergies between individual projects to help construction in all its stages. We are doing everything we can to make sure that the individual companies are healthy, motivated, and want to move forward and change the construction market. The Liftrock holding structure has a very pleasant internal culture in which we emphasise open communication and sharing experience.
So you are not afraid your activities and know-how will be copied?
MH: On the contrary, we welcome it. We have never made any secret of our openness and sharing in any of our projects, so we share our experiences wherever possible. We are, of course, saddened by the possible transfer of colleagues to competitors, but we also welcome it, because we are getting experts on the market with whom we want to work.
The newly formed Liftrock holding structure wants to act as an authority for other companies on the market. What does this term mean?
VV: We want to be an innovator – or an authority that the competition looks up to, looks at, is inspired by, if you like. We want to create a healthy market environment and have around us a group of modern, innovative companies with which we will both cooperate and compete. Our medium-term aims include expansion of activities into railway construction, strengthening our position in civil engineering, additional care and development of our position in transport construction, which is the basis of our business. We also expect clear development in the field of digitalisation and BIM.
We have mentioned the BIM method several times. Preparatory work is ongoing on the new Act on Information Model, Information and Digital Modelling (Act on BIM). What will this primarily mean for Liftrock?
MS: The forthcoming act will clearly be a positive impulse for the digitalisation of the construction industry. The digitalisation of the construction industry will therefore become part of national legislation. And because digitalisation is an integral part of services and tools provided by all companies in the holding structure, the new Act on BIM will be a very important document.
Liftrock has set as an aim that is is perceived as a leader in the digitalisation of the construction industry. How do you want to achieve this?
MS: The Czech construction industry is a very traditional sector. The acceptance of new ideas as one’s own is a complicated and long process. That’s why for a long time we have been involved in education, explaining what digitalisation of the construction industry means, what the BIM method is, we lecture at conferences, contribute to the creation of methodologies and directives for investor organisations. Today we can see in the field the first projects realised using the BIM method and a whole number of terms such as CDE, Building Information Model and data standard are not completely strange to us. And I’m really pleased that the sector already perceives us as an entity that is contributing to this process.
You mentioned that the Czech construction industry is seeing a fall in the number of young people. Do you think that the introduction of digitalisation could draw them back and obtain new, young experts?
MS: The construction industry is not a sector that ever boasted lots of young people. The tempo is set by the older generation of managers and professionals. That’s why today we have a unique opportunity, thanks to the new Act on BIM and related digitalisation, to change this state, make the construction industry a sexy sector that finally attracts young people.
What skills, obtained a universities, did you make most use of and appreciate in your later work?
VV: I studied economics, immediately after university I started as a budgetary specialist and calculator in a leading design office in the Czech Republic, I later moved up the company’s hierarchy until I got to a managerial position. I studied for an MBA while being employed. Professional day-to-day work on large infrastructure projects in the Czech Republic and Slovakia gave me the most skills and contacts that I later used in my current job.
MH: In addition to studying at two universities at the same time, I was also working full time. So it was all the more challenging. But after Neisse University it was another great life experience. However, there was pressure to get results. The MBA was very much about practical experience, specific projects and making new contacts across different disciplines.
In your professional career, Mr. Hlavnička, I discovered that you have also been the manager of a vineyard in Václavice near Hrádek nad Nisou for two years. Is it an investment or more of a recreational activity for you?
MH: (Laughs) It’s a purely recreational activity, in life and in my “professional” CV. Life is supposed to be fun, and if my love of wine becomes a profession, then that’s a bonus.
To follow on. Your work during the preparation of the holding organisation and in other areas is certainly full of deadlines and stressful activities. How do you prefer to relax and acquire new energy?
VV: The main release valve and anti-stress activity for me is clearly sport. At the current time as a part of maintaining my physical and mental health I am involved in martial arts, fitness and relaxing in the countryside.
MH: I would say that an executive position does not necessarily mean that it is stressful work. Obviously, the pressure for performance is markedly different. It can be combined with activities that charge the “batteries”. I am always pleased when we can help charitable associations or non-profit organisations, for which it is harder and harder to obtain the necessary finance. And when we can’t help others, I like to top up my energy levels actively in the garden and in my private vineyard.
MS: I have lots of ways to relax. For me, the biggest pleasure is working with wood. Making, for example, a fitted kitchen from wooden boards, that’s something that really makes me happy, where I can clear my head and get ready for additional challenges at work.
Thank you for the interview.
