Construction Economics and Building

Vol. 26, No. 3/4
2026

ARTICLES (PEER REVIEWED)

Modern Methods of Construction Require Modern Social Value Thinking

Greg Watts^1,* Cara Mulholland ², Mo Maleki Sadabad ³, Peter Mcdermott ³

^¹ School of Engineering and Environment, Manchester Metropolitan University, Manchester, M15 6BX

² Business School, Manchester Metropolitan University, Manchester, M15 6BX

³ School of Science, Engineering, and Environment, University of Salford, M5 4WT

Corresponding author: Greg Watts, G.Watts@MMU.ac.uk

DOI: https://doi.org/10.5130/7em6sg70

Article History: Received 08/01/2026; Revised 06/04/2026; Accepted 07/05/2026; Published 18/09/2026

Citation: Watts, G., Mulholland, C., Maleki Sadabad, M., Mcdermott, P. 2026. Modern Methods of Construction Require Modern Social Value Thinking. Construction Economics and Building, 26:3/4, 1–19. https://doi.org/10.5130/7em6sg70

Abstract

Modern methods of construction (MMC) are increasingly promoted as a solution to long-standing construction industry productivity and efficiency challenges through industrialised, off-site and centralised production processes. At the same time, social value (SV) practices are being increasingly adopted by contractors to both address the perceived anti-social nature of the industry and increase procurement success. Both concepts have grown in importance within the construction industry. However, whilst SV policies focus on hyper-local socio-economic community benefits, they currently conflict with the centralised focus of MMC. Instead of aligning, they compete, contradict and sometimes undermine one another. The contradiction between these concepts creates a tension that is yet to be explored. This research addresses this gap in knowledge to understand how this tension can be resolved for the benefit of both concepts. Interviews with 20 industry practitioners were undertaken utilising the theoretical lens of legitimacy theory to understand practitioner action. The findings reveal that both SV and MMC act as reciprocal barriers to one another’s development. Nevertheless, this research indicates that both concepts could complement and support one another if a modern social value approach is adopted. This is an innovative centralised approach to SV creation and moves away from the current devolved system of SV delivery. This research provides a substantial original contribution to an increasingly significant international problem: reconciling two seemingly disparate yet intertwined concepts.

Keywords

Off-Site; Legitimacy Theory; Procurement; Social Value; Productivity

Introduction

The construction industry covers the design, development, construction, refurbishment and demolition of built assets. The value of new UK construction work achieved a record high of £139,029 million in 2023, an increase of 4.2% compared with the 2022 figures (ONS, 2024), illustrating the increasing economic importance that the industry plays. This is echoed globally, as the industry drives economic development (Nguyen & Le, 2022), creates massive employment and consumes substantial energy (Lui et al., 2022). Despite such global economic significance, the industry has historically suffered from a poor reputation. This reputation is often linked to long-standing structural challenges, including fragmented supply chains, low productivity growth, adversarial procurement practices and slow adoption of innovation (Barthorpe, 2010; Stevens & Noguchi, 2019). As a result, the sector has faced increasing pressure from policymakers and industry bodies to improve efficiency, modernise its production and demonstrate its broader economic and social value. Many of these structural challenges arguably relate to issues in design coordination, fragmented supply chain practices and the broader economic and social impacts of construction activity. Modern methods of construction (MMC) and social value (SV) aim to address the same areas through improved production systems and enhanced value creation. In England alone, the industry produces over 60 million tonnes of waste annually (GCB, 2020) and has long been known for inefficient delivery and a confrontational and uncaring nature (Barthorpe, 2010). Additionally, the industry has long suffered from a reputation for high-risk, unsafe working environments (Guribie et al., 2025) and decreasing productivity per worker (Stevens & Noguchi, 2019). Such criticisms echo key themes highlighted in industry reports released decades apart, illustrating a well-established history of fragmented underperformance (Latham, 1994; Egan, 1998; Farmer, 2016).

To counter such long-standing criticisms, the industry is adopting a variety of practices, including championing SV to address the bad neighbour concerns and utilising MMC to cut waste, improve productivity and increase outputs. Whilst both concepts are increasingly explored in research and embraced in practice, they are both often considered in isolation from one another and can even serve to undermine one another. The core traits of MMC and SV seemed contradictory, with MMC relying on centralised, off-site construction to improve efficiency (Waqar et al., 2025) and SV focusing on hyper-local delivery of benefits near the project location (Watts, 2024). At present, MMC research largely ignores SV, and SV research is often conducted in isolation from MMC. This original and significant research is focused on the tension that exists in this underexplored intersection of contemporary literature. Given the internationally significant fields of MMC and SV, understanding how each concept is reconciling the barriers that undermine each other is required to ensure that MMC and SV can have a flourishing reciprocal relationship. The aim of this research was to explore the impacts that a continued push towards MMC has upon SV creation. The first objective was to gain an appreciation of both concepts as individual disciplines by identifying their need in the construction industry. The second was to understand how each concept is responding to industry and societal challenges in order to ensure that they remain legitimate in the eyes of stakeholders. The third was to explore how the concepts interact with one another. The fourth was to understand how the concepts can be developed in tandem to support one another, help the construction industry become more productive and less wasteful and create highly impactful and positive SV.

This paper proceeds to introduce both MMC and SV before discussing the lens of legitimacy theory. This is deemed the most appropriate lens to understand MMC and SV, as legitimacy has been used to help understand the actions of construction organisations, specifically on their adoption of SV and broader innovative practices. More broadly, legitimacy theory has been widely applied to understand how organisations in the construction sector respond to increasing societal expectations regarding sustainability, accountability and positive impact by aligning practices with evolving stakeholder norms and policy pressures (Suchman, 1995; Loosemore & Lim, 2017). The research methodology is then outlined, and the findings are presented. The original insight that this paper offers is highlighted, and the impactful nature of its findings for both industry practice and academic research is discussed.

Modern methods of construction

MMC encompass a broad range of similar and often interchangeable terms that seek to challenge traditional construction operations. This includes offsite construction, offsite manufacturing, offsite production, prefabrication and preassembly (Waqar et al., 2025). The concept has become one of mass customisation, combining standardised components with flexible design options whilst maintaining efficiency and sustainability (Stevens & Noguchi, 2019). Arguably, MMC is positioned as both a strategy, in that offsite elements are delivered to sites for inclusion in permanent construction works, and a system, in that traditional construction operations, once completed on site, are now in a controlled manufacturing environment (Razkenari et al., 2020).

MMC is currently undergoing somewhat of a renaissance in contemporary culture. Despite its origins traced back over 400 years, it is often considered a modern solution to a modern problem that addresses increased housing demands against the backdrop of a skills shortage (Razkenari et al., 2020). However, despite post-war booms to address immediate shortage concerns, MMC as a widescale approach has not been adopted by the construction industry (Goulding & Rahimian, 2019). An in-depth industry report on the current progress of residential MMC homes reveals that whilst MMC were used to construct 1 in every 20 UK homes in 2022 (approximately 3,300), the full potential of MMC remains untapped, as the industry can achieve an output of up to 20,000 homes per year (Make UK, 2022). Although figures vary, one source reports that 15,000 modular homes were constructed in 2017 (de Savary, 2018). However, even at peak capacity, these targets still fall significantly short of the UK Government estimate of 300,000 homes needed annually (Wilson, 2021). It appears that the total number of MMC units that can currently be delivered is higher than what the market requires, despite an increased housing demand and overall housing targets that are not being achieved. The interest in broader MMC adoption appears to be wanting, despite widely discussed benefits of increased MMC use.

A major benefit often cited by MMC practitioners is the speed of construction. Controlled factory environments support faster production with minimal opportunities for disturbance (Gao & Tian, 2020). Broader benefits often attributed to MMC use include increased innovation, improved health and safety techniques, efficient working practices, increased speed of overall processes, higher end-product quality and enhanced sustainability (Dowsett et al., 2022). Better cost certainty is an additional benefit of MMC adoption, with reduced preliminaries, maintenance costs and wastage all reported to lead to more accurate cost forecasts (Solin et al., 2025). For such benefits to be achieved, MMC need to be fully embraced and utilised, and as such, a centralised location as the “base” of operations for the construction manufacturing processes to take place before the completed units are transported and delivered to the location they are to be installed (Waqar et al., 2025). Despite such benefits, MMC has its own criticisms. High initial costs are an often-discussed, long-standing barrier to adoption (Bendi et al., 2020). A lack of knowledge that breeds scepticism, leading to risk-averse decision-making (reinforcing Goulding & Rahimian, 2019). There has also been high profile company failures where the primary business has been MMC processes, arguably revealing a lack of industry adoption (Weinfass, 2025). The lack of infrastructure capacity for manufacturing processes required also serves to further prevent the construction industry’s transition to widescale MMC use (Bendi et al., 2020).

Whilst MMC have largely been framed as a technological response to long-standing productivity challenges in construction, recent research suggests that their successful adoption depends on broader socio-institutional and governance conditions rather than technical capability alone (Goulding & Rahimian, 2019; Bendi et al., 2020). Scholars have increasingly argued that institutional logics, organisational legitimacy and broader stakeholder expectations play a critical role in shaping how construction innovations are adopted and embedded into industry practice (Loosemore & Lim, 2017). Emerging work also highlights that the strong emphasis on productivity and efficiency within MMC discourse may overlook wider social and stakeholder outcomes, suggesting the need to better understand how technological innovation in construction impacts broader societal priorities (Raiden et al., 2019). This perspective provides a useful link to SV discussions, which emphasise the social, economic and community impacts of construction activity and increasingly shape policy and procurement expectations within the sector.

Notwithstanding these barriers to overcome, MMC’s centralised production model, typically based on off-site manufacturing and geographically concentrated facilities, also poses problems for an industry that has multiple competing demands and finite resources. For example, the need for the industry to provide evidence of its engagement with SV is also increasingly expected. SV seeks to maximise social, economic and environmental benefits for communities affected by development projects, often emphasising hyper-local employment, supply chain participation and community engagement. However, with the hyper-local focus of SV, a tension emerges between both concepts, with MMC often favouring a centralised delivery approach. This spatial tension is the central focus of this research, with MMC considered primarily in relation to the construction and delivery phase of projects where industrialised off-site production is most directly applied. Notwithstanding the benefits that widescale MMC adoption would bring, the concept has not yet been widely adopted by the construction industry. Adopting MMC requires a more centralised and less devolved attitude. However, this directly contradicts the approach currently adopted by SV expectations, where a devolved approach is considered crucial to successful SV delivery.

Social value

SV can be considered generally as the benefits that an organisation brings to society through its strategies and actions (El Daouk, 2025; de la Cruz Jara et al., 2025). Echoing the long history of MMC, positive organisational behaviour can be traced back hundreds of years across numerous industries (Dylikk & Muff, 2016), with SV appearing across decades as a way to frame such positive outcomes (Schumpeter, 1909; Auerswald, 2009). Contemporary SV work presents an international agenda that exists in both industry and academic spaces. Social Value International has become the default representative professional organisation, with 26 national and regional networks reaching across 5 continents. The work originated in social accounting, later expanding to cover the associated fields of policy and procurement (Wright et al., 2025). With the introduction of social procurement policy and legislation in many countries, such as the UK (The Public Services (Social Value) Act (2012)), Australia (at both state and national levels), Canada (Policy on Social Procurement) and South Africa (layered existing policies), the concept and terminology were brought into mainstream organisational consciousness and served to drive public client’s socio-economic objectives (Malacina et al., 2022). Policy and legislation generally serve to legitimise client requests for business responsibility by mandating that all public sector procurement identify social outcomes, with some mandating weighted SV-based criteria. The need to provide evidence that SV has led to an increase in the need for SV measurement and communication practices (Watts, 2025). Such practices now sit alongside those of environmental performance measurement and the need to provide evidence of its impact (Vanclay et al., 2015).

This focus on procurement and impact measurement, however, may conflict with general understanding of sustainable and responsible business practices. Debates are ongoing as to how SV should be understood, with an ongoing tension between subjectivist perspectives and the objectivist need to measure and communicate the concept (El Daouk, 2025). It is the objectivist SV arguments that appear to winning in the arena of public opinion and organisational actions, as a diverse range of SV quantification tools have been launched in recent years to assist SV comparison and communication (Skidmore, 2021). Recent research has revealed that such quantification tools are often incompatible, inconsistent and inaccurate and are driven by a more capitalist agenda of profit maximisation over any broader social benefit (Watts, 2025). Clients utilising and enforcing these quantification tools often restrict the geographic areas where benefits are allowed to “count” (Watts & Higham, 2022). This is often to the detriment of other nearby locations, as the ramifications of such policies lead to reduced spending in other regions. Nevertheless, organisations that engage with such SV requests are perceived by clients to have legitimacy in their ability to deliver SV. Thus, in practice, SV often presents as a process that focuses on evaluating the social impact of organisations, projects, operations or interventions (Kroeger & Weber, 2014; Malacina et al., 2022; Gutiérrez-Nieto et al., 2025).

This focus on procurement and metrification misses out parallel and complementary fields that we see in the more general discussion of SV, such as sustainability, social impact, corporate social responsibility (CSR) or social equity, which equally appear in academic and industry literature (de la Cruz Jara et al., 2025; El Daouk, 2025; Watts, 2025). This reflects the strain in SV to push for more standardisation and stabilisation without losing opportunities for meaningful value creation and capture (Samuel & Watson, 2023). This wider inclusion and utilisation of SV definitions are common across many fields (Dyllick & Muff, 2016), with a prominent growth within architecture, engineering and construction (AEC) and the whole built environment. Quantification, it appears, is necessary for a shared objectivist language to exist between stakeholders, despite obvious pitfalls in capturing the nuanced and subjectivist SV approaches.

Because of heterogeneous definitions, understanding and usage of SV (de la Cruz Jara et al., 2025), there has been an opportunistic approach to SV in practice within AEC, utilising the “making do” approach (Di Domenico et al., 2010) to provide legitimacy through a commonly understood language. There is growing attention on exploring the SV of construction internationally, with empirical studies undertaken on the phenomenon and its utilisation in many countries (Loosemore et al., 2020; Samuel & Hatleskog, 2020; Gidigah et al., 2022; Ricket & Goodspeed, 2025; Mangvwat et al., 2026). These findings illustrate that both practice and theory have more than a simple economic valuation of the built environment. Instead, they open up discussion on many interrelated wider fields, including sustainable design, environmental outcomes and construction practices.

These site-specific features of construction have become particularly significant when considering the increasing adoption of MMC, as centralised off-site manufacturing and industrialised production processes may shift where economic activities, employment opportunities and supply chain participation occur, potentially creating tensions with SV objectives that prioritise locally generated benefits (Goulding & Rahimian, 2019; Bendi et al., 2020).

In particular, the construction stages of general AEC projects bring specific constraints to consider in both practice and theory. SV is often theorised as a focus on socioeconomic impact, responsible construction practices and partnerships (Gyadu-Asiedu et al., 2024). This reflects the industry’s focus on the “build” stage, which tends to beat the weight of any focus (Dobson et al., 2020). For SV, this common focus is often on the socio-economic impact on local communities and immediate supply chain over technical design consideration (Gyadu-Asiedu et al., 2024), which can therefore conflict with the goals of MMC. Nevertheless, engagement with both concepts is increasing, and both provide a degree of legitimacy in the eyes of stakeholders.

Social value and legitimacy theory

Many organisations have attempted to offer financial quantification and validation of SV activity in an attempt to provide a common language with which SV can be communicated (Watson et al., 2016). Subsequently, the activities that lend themselves to be easily financially quantified became those that are most commonly delivered (Watts, 2025). Arguably, these organisations are essentially “selling” SV legitimacy, in that engagement with an SV quantification tool, despite the lack of rigour the quantification process entails, results in the users being afforded legitimacy as they are perceived to have a degree of SV fluency. SV is also being used to legitimise sustainability practices, an important step that is more widely recognised in the journey towards organisational sustainability (Kochkina et al., 2024). SV measurement and communication are becoming a tool for legitimising incoherent sustainability initiatives. Nevertheless, such tools gain “buy-in” from stakeholders through relatable reporting to create organisational legitimacy (Christensen et al., 2021).

Institutional theory posits that over time, institutions will show patterns and practices that become consistent and standardised, as is observable for construction SV. Legitimacy theory provides an insight into organisational motivations and the actions of individual actors within those organisations (Suchman, 1995). Legitimacy is a core concern for business and organisational sustainability (Thomas & Lamm, 2012), with legitimacy theory providing a useful perspective to use when studying ecosystems, environmental and supply chain management, corporate governance and the traps of corporate greenwashing (Li & Lemke, 2025). As a theoretical lens, legitimacy theory has been utilised to evaluate organisational decision-making in its efforts to achieve and preserve legitimacy in the eyes of stakeholders (Duff, 2017). According to Suchman (1995), such legitimacy has three broad forms: pragmatic, moral and cognitive. Duff (2017) developed this further with relevance to CSR, a precursor to the idea of SV. A further adaptation is presented in Table 1 to demonstrate its application to legitimacy theory and values.

**Table 1. Forms of legitimacy (derived from Duff, 2017).**
Type of legitimacy	Sub-category	Implications for social value (SV)
Pragmatic – the practical consequences arising from organisation and stakeholder exchanges	Exchange legitimacy – organisations develop practices to be perceived as legitimate Direct value	Offering practical things to stakeholders such as activities for communities
	Influence legitimacy – stakeholders believe that organisations are responsive to, and acting on behalf of, wider societal concerns	Where organisations sway social opinion to be perceived as responding to societal needs
	Dispositional legitimacy – stakeholders perceive an organisation as having genuine concern for society	Where organisational action is often proactive or occurs as a default behaviour
Moral – where organisations are perceived to be fundamentally doing the right things by stakeholders	Consequential legitimacy – stakeholders judge organisations on their achievements	A move away from tick-box exercises to genuine value creation
	Procedural legitimacy – organisations adhere to socially accepted practices	Building relationships with stakeholder groups for social licence to operate
	Structural legitimacy – stakeholders perceive the hierarchical structure of an organisation, and its resources can achieve the goals set	Understanding different framings and delivery of social value for different reasons even within a single construction project
	Personal legitimacy – stakeholders make personal evaluations regarding the leadership of an organisation	Attributed more to the “who” of SV design and delivery
Cognitive – when stakeholders believe that the motivations of an organisation mirror their own	Comprehensibility – organisations intentionally structure themselves in a manner understandable to stakeholders	Demonstrating sustainable delivery, building trust and gaining a social licence to operate Positive reputation
	Taken-for-granted – stakeholders perceive an organisation to be one of a select few who can deliver the services they need	When an organisation is viewed as a leader in SV delivery and is approached for its SV just as much as its “standard” operations

In addition to the forms of legitimacy, symbolic legitimacy has emerged as a term to cover those organisations that seek to gain legitimacy in the eyes of stakeholders by demonstrating that they meet social expectations but without substantiation. Such organisations do not alter any fundamental behaviours but still seek to be perceived as legitimate in the eyes of stakeholders. This can be juxtaposed against substantive legitimacy, which describes the organisations that are genuine and alter fundamental behaviours to achieve their goals in an authentic and accurately representative manner (Belal & Owen, 2015). Indeed, one study revealed that many UK construction industry contractors report on CSR and SV in a manner that allows them to be perceived as legitimate in the eyes of stakeholders, when actually they obfuscate their existing practices behind a ‘greenwash’ of contemporary CSR- and SV-related terminologies in their reporting practices in an effort to gain legitimacy (Watts et al., 2019). It appears not all stakeholders are able to differentiate organisations that have achieved symbolic legitimacy from those that have achieved substantive legitimacy.

SV and legitimacy are therefore intertwined, with SV engagement affording legitimacy even if seeking such legitimacy is not the intention behind organisational actions. However, as MMC are also increasingly utilised in the construction industry and have the potential to displace SV activities and therefore influence the legitimacy that SV activity allows, it is critical to understand how the concepts of MMC and SV interact. Arguably, a tension exists at the heart of where these concepts connect. SV is currently restricted by a devolved localist agenda, whereas MMC require a centralised focus. An increase in MMC use could reduce the amount of SV delivered locally to a project’s location. Therefore, for those contractors who do propose MMC solutions, this would inevitably result in a perceived lack of SV legitimacy in the eyes of clients and key stakeholders. This tension between two disparate yet interlinked contemporary construction industry demands is currently an underexplored research area that has significant industry ramifications. Understanding this interaction is particularly important, as MMC adoption may not only reshape how SV is generated but also influence how construction organisations maintain legitimacy with clients, policymakers and local communities.

Research methodology

The aim of this paper was to understand the impact that an increased uptake of MMC will have on SV. This involves exploring the tension that exists at the heart of both concepts. SV is fundamentally a social construct in that its reality is dependent upon the agreement of the actors involved, and its understanding can change from one situation to another. To best understand this tension at the intersection of such a social construct, a constructivist ontological position was adopted. This perspective argues that social phenomena do not have an independent existence, with their existence based upon agreements and understandings collectively held by social actors (Clarke et al., 2021). Whilst MMC arguably have a more objectivist grounding, it is the concept’s subjective principles and perceptions that are sought. Epistemologically, interpretivism is closely aligned with a constructivist ontological standpoint, with interpretivism stating that the best method of inquiry to reach an acceptable level of knowledge of a concept is a qualitative approach due to the subjective nature of the concepts under investigation (Robson & McCartan, 2017).

Semi-structured interviews are adopted to allow an individual’s opinions, interpretations and perceptions to be understood and for complex issues to be discussed and elaborated upon (Phellas et al., 2012). The first research phase comprised a total of 15 interviews conducted with 20 construction industry professionals. Comprehensive literature reviews indicate that high-confidence interview data require a sample of 11–15 interviews (Galvin, 2015). Table 2 shows the characteristics of the participants. Due to time constraints and diary commitments, and where participants were from the same organisation, five interviews contained two participants.

**Table 2. Professions of interviewees (authors’ own work).**
ID	Organisation	Experience (years)
MCS1 and MCS2	MMC Consultant A	5 and 8
SVC1 and SVC2	SV Consultant A	2 and 3
MC1 and MC2	MMC Contractor A	10 and 15
C1 and C2	Contractor A	12 and 7
C3 and C4	Contractor B	4 and 4
CS1	Consultant A	18
MCS3	MMC Consultant B	7
C5	Contractor C	7
CS2	Consultant B	2
SVC3	SV Consultant B	17
C6	Contractor D	5
C7	Contractor E	2
SVC4	SV Consultant C	1
C8	Contractor F	4
C9	Contractor G	11

The interview participants were identified through a method of purposive sampling, as they fit the specific needs of this research (Robson & McCartan, 2017). In this instance, construction professionals had knowledge and experience of MMC and/or SV. All participants were recruited online via professional networks and were emailed an outline of the research in the first instance before agreeing to be part of the research process. Each interview session lasted between 45 and 75 min. A process of narrative analysis was adopted to both structure the interview questions and analyse the data. Although starting as a method of analysis adopted largely within the social science research (Griffin & May, 2012), in recent years, narrative analysis has gained popularity and widespread use within the construction management literature (see Ebiega-Oselebe et al., 2021). It is a process whereby responses are requested from interviewees in the form of stories with information and then extracted to provide insights into the respondents’ understanding, perceptions and motivations behind their views and actions (Sandelowski, 1991). In this research, narrative analysis was operationalised through interview questions that asked participants for stories that would illustrate their knowledge and experience. Narrative analysis was utilised in conjunction with legitimacy theory, which was adopted as a framework for the interviews, with the questions phrased around the categories of legitimacy to better understand the perceptions and actions of the respondents. Such questions included “What do you understand by the term MMC?”, “Can you provide an example of the benefits you’ve witnessed when using MMC?”, “What experiences do you have of SV?” and “What type of SV did you deliver when utilising MMC?” Other questions were more overt in their adoption of legitimacy theory, such as “Can you tell me a time you have adopted SV policies in response to stakeholder concerns?” (influential legitimacy) and “How do you feel [stakeholders] judge your SV achievements, do you have any examples?” (consequential legitimacy).

The transcript of each interview was reviewed, and a process of coding occurred whereby codes were attributed to the emerging themes. This then allowed themes to be identified and grouped, revealing patterns of consistency and conflicts in the data. The categories of legitimacy theory were then utilised as the main themes to identify, compare and analyse the interviewee responses.

The second research phase consisted of a workshop with four industry professionals who were not interviewed during the first phase. These participants were recruited through the same purposeful sampling method, and a single, 60-min workshop was held. During the workshop, the findings from the first research phase were presented and discussed, and the participants analysed, tested and critiqued the industry recommendations from research package 1, gaining deeper insights into how to successfully integrate them into construction industry practice.

Findings and discussion

Analysis of the interview data revealed several key themes. These included the increased demand for innovative solutions (such as MMC) to industry productivity problems and increased demand for SV activities, thereby confirming the potential for the tension that this paper identified to be further amplified in the future. This revealed the contradicting nature of the legitimacy afforded by both SV and MMC, and how MMC and SV are currently serving as barriers to restrict the development of one another. However, an innovative and original solution emerged from the research that allows both MMC and SV to evolve in tandem, serving to help and support one another for the benefit of both the construction industry and the wider society through modern social value (MSV).

An increasing demand for modern methods of construction

Reinforcing points in the literature, the interview responses revealed the numerous names used in industry for what this paper terms “MMC” (Waqar et al., 2025). The MMC consultants and those contractors who focused on MMC were perhaps unsurprisingly the most vocal regarding the benefits that MMC could provide. Such benefits echoed those discussed in the literature (Dowsett et al., 2022).

An increase in inquiry regarding MMC practices was reported by MCS3, stating, “There has definitely been an increase in the number of clients contacting us in the last few years…and seeing how we can help solve problems they have”. This was then reinforced by C6 and C9, who confirmed that their respective contractors had also started to use MMC components and explore potential further use. However, the increased level of interest from clients was not reportedly being translated to orders, as MSC1 stated, “We are getting more enquiries…but our order pipeline is the same”. This echoes the industry literature indicating that modular output still remains low across the industry (Make UK, 2022).

Comparison of all interview data revealed that those interviewed had a consistent belief that the MMC market is currently being driven by “speculation” and that MMC is an innovative industry proposed as a solution to client (and societal) problems, but clients and the wider property market are not yet willing to take the steps necessary for widescale adoption.

Contractors involved with MMC, but not focused on it, discussed barriers when the topic of MMC was raised. There was a consensus amongst interviewees that MMC was a more expensive option, with MMC viewed as a costly alternative only to be used where clients expressly requested such practices be utilised. Whilst interviewees C1, C2 and C5 stated that they had no personal objection to the use of MMC and were supportive of some of the benefits of MMC, they all returned to cost as the main prohibitive barrier to widescale adoption within their own organisations. However, when probed further, interviewee “C1” stated, “When I had to use [MMC] it was more hassle than it was worth…with all the time and effort spent on the procurement and then getting the elements installed correctly on site…we just thought, why are we paying more for more hassle…”

This aligns with the disadvantages presented in the literature regarding high initial costs (Bendi et al., 2020). Further questioning revealed that while cost was a concern, other negative issues resulted primarily from the interviewees’ initial experience with MMC, which would likely diminish in future projects. Nevertheless, it appears that general scepticism and the risk-averse nature of the industry [for other barriers discussed, see Bendi et al. (2020) and Goulding and Rahimian (2019)] were bigger barriers than cost. This was further reinforced when C2 responded, “It’s just not a method I trust. I don’t think it’s used enough at the minute and so I don’t want to experience any teething issues on my sites…I’ll wait until it’s more well-known…”

Despite arguments reinforcing the MMC benefit of high quality, the responses of C3 and C4 were both critical of the MMC quality they had witnessed to date. With interviewee C4 recalling:

One time I had ordered 50 bathroom pods (a form of MMC where each bathroom unit for a student accommodation building was preassembled off site and then delivered and connected to the student rooms being constructed on site) and nearly everyone had something missing…towel rails, shower heads, toilet seats… we had to open up and go through every single pod and create a snagging list…this was exactly what we wanted to avoid with having the pods in the first place.

Ultimately, however, it appears that MMC adoption is a growing concept, with all interviewees confirming that they have witnessed demand increases previously, and all anticipate this to continue in future. This was revealed to be intrinsically linked to societal expectation and the added legitimacy that adoption of MMC practices will bring.

An increasing demand for social value

All interviewees were identified and approached for participation based on their different levels of engagement with MMC. However, all were aware of SV as a concept and familiar with its demands within the construction industry. The findings reinforce points in the literature that since the introduction of the Social Value Act, SV is now part of everyday business language and is often the difference between a successful and unsuccessful tender, but still means different things to different people (Watts et al., 2019). This was evidenced by the diversity of responses given when interviewees were asked for stories of their own SV practices:

Everything from hiring unemployed people to using sustainable materials. (MC1)

The last company we worked with focused on local spend and working with a nearby school, the one before it was the number of apprenticeships created. (SVC1)

We work closely with prisoners and focus on rehabilitation to give people the skillsets to enter the construction industry. (C2)

We usually have a set financial target for SV, and then a list of activities that each worth a different amount, we let the client pick pretty much whatever they want and we do it. (C4)

Using local suppliers, talking to the residents about construction, organising work experience, creating local employment, you name it and we do it. (C6)

However, despite the differences in definitions and perceptions, analysis reveals two key themes that permeated throughout all interviewee SV responses. The first is the quantifiable nature of SV practices undertaken. The second is the locality of the SV practice to the project in question. Whilst not all answers followed these themes, with some SV practices discussed that do not lend themselves to be easily quantified (such as measuring the individual personal impact of employment) and some SV practices mentioned that were not undertaken in close proximity to the site (such as donating to charity and setting up a centralised training academy), the overwhelming majority of SV practices discussed were both quantifiable and local.

The findings also support the literature in that SV as a procurement requirement is growing (Watts et al., 2019) and that all stakeholders expect the construction industry to engage more with SV as a standard business practice: “We’re always being asked what we do for SV. It’s now part of the standard questions we’re asked” (C3).

The results confirm that SV demands placed upon construction industry organisations are increasing, and the perceptions of all those interviewed are that such demands will only intensify in the future as clients seek to achieve greater SV from their spending. This revealed the tension that exists at the intersection of the MMC and SV concepts, with both confirmed to be growing in popularity; albeit at present, SV is a more mature concept than MMC. This imbalance in maturity could mean that embedded SV practices must be separated from client expectations in order to facilitate the growth of MMC. Unless we purposefully and proactively address these existing mindsets, the growth of MMC may be limited, as SV expectations would unwittingly serve as a barrier to MMC adoption.

SV activity does result in increased legitimacy

Analysis of the interview responses also revealed evidence of links between SV engagement and increased legitimacy. This was especially prevalent with the attainment of pragmatic legitimacy. Whilst no respondent directly stated that increased legitimacy was a main motivating factor for SV engagement (exchange legitimacy), responses such as “…the [SV] actions we undertake definitely show clients we care about society” (C5) and “We mean what we say [when it comes to SV] and clients know this…” (C6) closely align with influence legitimacy and dispositional legitimacy.

The responses also revealed that SV engagement spans a range of legitimacy types. For example, interviewee C5 stated:

As a company we really take it seriously…we have a lot of staff to deliver our SV commitments…every project has a designated SV liaison who directs and supports the team…we need to provide this. We were proactive and have had this in place a while…but now all clients see it as normal for us. (C5)

This illustrates that SV behaviour can potentially be considered to achieve moral cognitive legitimacy in the eyes of clients and broader stakeholders. However, interviewee C4 gave an example of exchange legitimacy that was also arguably purposefully seeking to gain symbolic legitimacy, confirming that:

We have to do whatever the client asks…we don’t do anything [SV related] if a client isn’t asking us to.

The sub-categories of moral legitimacy also resonate with interviewee responses, as one contractor consultant recalled: “The companies we predominantly work with are compiling tenders or have won work and now need our help to deliver…they are being judged on what they say and do” (SVC2), and a contractor stated, “SV is built into our business plan…it’s at every stage of the process” (C2). Such responses closely align with consequential legitimacy and structural legitimacy.

Although no respondent stated that they engaged with, or witnessed others engaging with, SV practices resulting from legitimacy-seeking intentions, the use of the theoretical lens of legitimacy revealed that the adoption of SV practices does result in construction professionals perceiving their organisation as more legitimate in the eyes of stakeholders. Whilst this is arguably an internal stakeholder’s perception of how their organisation is perceived by “external stakeholders”, it still reveals that increased legitimacy is viewed as an additional benefit of SV engagement. Consultants working with numerous clients and contractors (SVC1 and SVC2) did allude to the legitimacy perhaps playing a more important role in some of the client’s motivations behind SV engagement, with SVC1 noting one contractor who engaged their services so they could help the contractor “tick the right SV boxes” and qualify for future work and SVC2 recalling a story of another construction contractor who believed that engaging with the SV consultant would “show everyone we are serious about this process”. Whilst undoubtedly they were serious about SV, their awareness of the increased positive perceptions of others due to their engagement with SV consultant reveals that an element of increased legitimacy is perhaps on the periphery of construction organisations’ SV decision-making.

SV legitimacy as a barrier to MMC adoption

The “separating” of SV from client expectations will be further hindered by the legitimacy that such SV practices afford. As the growth of both concepts leads to the theoretical tension being realised, the enhanced maturity of SV and its legitimacy-affording characteristics may undermine the potential growth of MMC.

The construction professionals who did not focus on MMC (C3, C4, C5 and C6) were all in agreement that their current SV practices were successful in winning new work, satisfying client demands and fulfilling organisational ambitions in being responsible and SV-focused contractors. Indeed, one contractor reported: “We deliver the SV we agree to…it’s for the benefit of everyone, including our staff who know the company is one that gives back to society and doesn’t just take…” (C3).

However, the results indicate that SV is primarily driven by quantifiable and local metrics, and the practices that achieve such metrics are perceived to increase organisational legitimacy. As the literature illustrates MMC to be centralised and manufacturing-driven processes (Razkenari et al., 2020) and with the UK Government’s target to construct over 100,000 MMC homes annually (Morby, 2016), an increase in MMC appears to be at odds with the current SV agenda. The contractors interviewed appeared reluctant to make any changes to their current SV practices, as one contractor stated: “Our SV works for us, for our clients, our project teams…those who benefit from it…for everybody” (C3). Another claimed: “I can’t see us changing what we do, we’ve just got the balance right and can deliver all current SV commitments cost effectively” (C5). A third believed: “We are happy to try whatever the client asks for…but we’re involved in loads [of SV practices], and we know where we can make the biggest impacts around our sites” (C6). A follow-up question on the location of the SV practices undertaken revealed: “…it’s all local to projects, we’ve finally got our supply chain to buy in…and pull in the same direction….it would be difficult if we were suddenly asked to do something completely different” (C6).

It appears that the current legitimacy afforded to contractors who deliver local SV benefits for clients is serving to restrict contractor interest in changing their construction practices, potentially limiting their motivations to adopt MMC approaches. The legitimacy afforded to SV practices therefore serves as a barrier to innovation in construction, including the use of MMC. Although geographical localisation remains a priority for clients, and SV is embedded into hyper-local agendas and accepted practices, the legitimacy of accepted practices will serve as a barrier to MMC use. This study builds on the barriers emphasised in existing literature that tends to focus more on the infrastructure capacity (Bondi et al., 2020) than on the indirect barriers that also exist.

Overcoming the tension between MMC and SV with the creation of modern social value

Both MMC and SV have independent drivers within and outside the construction industry, so both are forecast to increase in importance and prevalence in the coming years. Each is positioned to address different societal needs. However, the tension that exists between the concepts could restrict the widescale adoption of MMC, as SV is more mature and intrinsically linked to the perceived legitimacy of the organisations undertaking SV actions.

An alternative, perhaps novel, approach to SV delivery adopted by one MMC contractor focused on the creation of temporary small factories, whether inside disused barns or warehouses, or set up in any appropriately sized space, such as in prisons and factories.

We don’t own a factory…we move around different regions, set up our temporary factories and utilise local supply chain and train those with low construction skills…the end MMC houses can then be used for social housing, to house homeless people…or as affordable homes. (MSC2)

The approach adopted with regard to SV is to monetise if it is required but also ensure that SV is “built into the business plan and not bolted on” (C9) as “if it’s bolted on it can be unbolted” (C9). This MMC approach aligns with current SV requirements and so arguably still achieves the same level of legitimacy afforded by clients due to the local nature of the SV undertaken.

There are calls from within the industry for SV to be perceived differently. There has been pushback against the accepted quantification methods adopted due to their inconsistent approaches (Watts, 2025). Those involved in MMC delivery are also calling for a change in how SV is perceived and how legitimacy is awarded. The calls are to move away from a devolved local agenda towards a more national consideration of SV creation. If such a move could be facilitated, the tension between current SV and MMC practices could be removed, thus affording legitimacy to those contractors who engage with SV practices that are not delivered locally to the geography of the construction project. Ideas for a new form of SV delivery emerged from the analysis of the interview responses, with the term “modern social value” coined to reflect the new type of SV practices undertaken. When discussing the future of SV and MMC, one interviewee responded: “We need to move away from a hyper-localised SV approach to one that considers the whole life cycle of the building, and the SV generated across the UK as a whole” (MC2). This is calling for a different SV understanding from clients, one that asks clients to consider the broader SV, not just that created within their region and as identified as currently crucial by some clients (Watts & Higham, 2022).

Whilst the theoretical tension between MMC and SV may be realised if current practices for each concept are continued, changes to the hyper-local SV expectations or changes to the current MMC-centralised manufacturing processes can result in SV still being achieved via the process of MSV practices. This new approach to SV delivery would be inclusive for MMC and serve to remove the tension that currently resides at the intersection of SV and MMC. Removal of this tension would remove one of the indirect, and perhaps currently hidden, barriers to MMC adoption. The evolution of SV, not as a devolved localised concept where legitimacy is afforded for local action but as a centralised construct where legitimacy is awarded for innovation and overall societal benefit, would aid the development of MMC. Such an evolution could be considered MSV. MSV would serve as a framework within which SV activities could be undertaken and afforded legitimacy, despite them not having a hyper-local focus. Under the framework, their benefit would still be acknowledged and afforded legitimacy. It would also allow a formal link to be acknowledged between SV and MMC practices that extend beyond currently actioned understandings that predominantly focus on initiatives delivered in addition to construction activities and allow SV to be considered as more intrinsically linked to the construction process itself.

Conclusion

Both MMC and SV are increasing in importance within the construction industry. This is driven by client demands, societal expectations and policy pressures. Although MMC is widely recognised for its potential to improve productivity and quality, its adoption remains limited due to perceived high costs, industry risk aversion and early negative experiences. By contrast, SV is more mature, embedded into procurement processes and strongly linked to organisational legitimacy, particularly through quantifiable and locally delivered outcomes. Such local outcomes are currently “linked” with perceived legitimacy from broad stakeholders.

This research identifies a growing tension between MMC and SV. Current SV practices, which prioritise local and measurable impacts, may unintentionally act as a barrier to MMC adoption, as MMC’s centralised and manufacturing-driven processes can reduce opportunities for locally focused SV delivery. The legitimacy afforded by established SV practices further reinforces resistance to change, limiting innovation. This can hinder the widescale adoption of MMC practices. To address this tension, the concept of MSV is proposed. This is an integrated approach that aligns MMC and SV objectives. MSV reframes SV as a broader, life cycle-based and potentially national construct, embedding SV into MMC processes rather than treating it as an add-on. This approach enables both concepts to evolve in tandem and allows the current perceptions that localised SV delivery and legitimacy must go hand in hand to be separated. Adopting MSV would allow MMC and SV practices to complement and support one another. However, without an immediate reconciliation of these concepts within the perceptions of construction industry professionals, a focus on both as independent concepts may undermine and restrict their mutual development.

This paper addresses a notable gap in the literature at the intersection of MMC and SV and proposes solutions to avoid the theoretical tension that may reveal itself in the future. The recognition of SV as an interrelated variable influencing the success of MMC is also a key contribution of this paper. Future research should also be conducted to understand the link between contractors who do and do not engage with MMC and those who do and do not engage with SV, and identify any correlations. How legitimacy theory can be extended to understand SV behaviour and how the legitimacy afforded by stakeholders can hinder the development of other concepts should also be explored. This research serves as a platform for future studies to explore the unintended ramifications of legitimacy. Future work in this area should consider the needs of clients and how they perceive SV in relation to MMC delivery from a legitimacy theory perspective. The current embedding of legitimacy amongst accepted practices should also be reviewed to understand if the repositioning of legitimacy-awarding activities can serve to remove barriers encountered by the industry in other areas. The construction industry contributions of this paper include increased industry awareness of the resulting restrictions of simultaneously focusing on MMC and SV. Whilst these can be resolved with the adoption of MSV, further research is recommended as to how MSV can be implemented successfully. Supporting holistic industry change and adoption of MSV are recommendations for broader industry policy, and future policy needs to recognise a more centralised and nationally focused understanding of SV.

The limitations of this study include the sample size and spectrum of the participants. Although somewhat diverse in its range of views and experiences, including a broader range of sample population from across the construction industry spectrum, such as developers and clients, would enhance the robustness of the findings and help further understand the MMC and SV tension, as well as understand the broader application potential of MSV and the additional implications and consequences of legitimacy-driven behaviours.