Development of Lean Model for House Construction Using

Value Stream Mapping

Haitao Yu1; Tarry Tweed2; Mohamed Al-Hussein3; and Reza Nasseri4

Abstract: Lean construction has recently attracted considerable attention in the home building industry. Lengthy delivery time and
significant waste in the construction process have caused many home builders to seek a more effective production model that will increase
process reliability, reduce total lead time, and improve quality. However, although housing construction provides the closest analogy to
manufacturing, a high level of variability prevents the direct transplantation of lean paradigm and techniques. In collaboration with a local
home builder, a systematic approach based on value stream mapping technique is developed in this research to analyze the current process
and to formulate a lean production model. The model has four main features: synchronized first-in, first-out lane-based flow, production
leveling at pacemaker, work restructuring, and improved operation reliability. A simulation template is built to verify the model and to
assist in the development of interim implementation models. This paper presents data collection and value stream selection, current
practice analysis, and specific changes proposed for the lean production model.
DOI: 10.1061/共ASCE兲0733-9364共2009兲135:8共782兲
CE Database subject headings: Buildings, residential; Housing; Lean construction; Production management; Construction
management; Process control.

Introduction to Construction.” This notion quickly attracted the attention of

In North America, the home building industry has changed little
since the 1920s, when the wood platform-frame structure
emerged as the standard building technology. Although advances
in tools and materials have led to some incremental improve-
ments, the fundamentals of the construction process remain al-
most identical and no significant improvements in productivity
have been observed 共Zhang et al. 2005兲. In contrast, other indus-
tries have experienced remarkable productivity improvements
through the application of innovative technologies and operation
management tools. A recent example is the automobile industry,
where manufacturers have dramatically improved productivity
through the adoption of a new production philosophy which has
led to the “lean production system.” Popularized by Womack’s
book, The Machine That Changed the World 共1990兲, “lean
theory” has been widely employed by a range of industrial sectors
in the past decade.
Research on the implementation of lean theory in construction
began in the early 1990s, when Koskela 共1992兲 wrote a ground-
breaking paper, “Application of the New Production Philosophy
1
Ph.D. Candidate, Dept. of Civil and Environmental Engineering,
Univ. of Alberta, Edmonton AB, Canada T6G 2W2. E-mail: hyu@
ualberta.ca
2
General Manager, Landmark Homes, 9765-54 Ave., Edmonton AB,
Canada T6E 5J4.
3
Associate Professor, Dept. of Civil and Environmental Engineering,
Univ. of Alberta, Edmonton AB, Canada T6G 2W2.
4
President, Landmark Group, 9765-54 Ave., Edmonton AB, Canada
T6E 5J4.
Note. This manuscript was submitted on November 1, 2007; approved
on March 11, 2009; published online on July 15, 2009. Discussion period
open until January 1, 2010; separate discussions must be submitted for
individual papers. This paper is part of the Journal of Construction
Engineering and Management, Vol. 135, No. 8, August 1, 2009.
©ASCE, ISSN 0733-9364/2009/8-782–790/$25.00.
researchers in residential construction. Gann 共1996兲 and Barlow
et al. 共2003兲 compared industrialized housing with automobile
manufacturing in Japan, highlighting the similarities existing in
their production strategies, but the focus of the papers was on
product development, supply-chain coordination, marketing, and
sales, rather than on fundamental construction practice. Zhang
et al. 共2005兲 proposed a waste-based management approach that
considered all process inputs, including labor, equipment, materi-
als, data and information, work space, and time, as potential
sources of waste. Two case studies in housing construction were
presented to demonstrate that minimizing resources waste would
significantly improve productivity and quality. Ballard 共2001兲
suggested that variability was the major source of waste in con-
struction and that even flow production could increase the reli-
ability of work flow and thus reduce cycle time in home building.
Bashford et al. 共2003兲 further discussed implications of even flow
production and concluded that the strategy had minor impact on
construction duration but could significantly reduce work flow
variability.
The research presented in this paper continues Ballad and
Bashford’s efforts on house production flow management, but
proposes a new lean production model by utilizing value stream
mapping 共VSM兲. VSM, referred to at Toyota as material and in-
formation flow mapping, is the most commonly used tool in lean
planning. It helps lean system practitioners to think about flow
instead of isolated wastes and to implement a lean system instead
of individual lean techniques. Some research has been done in the
application of VSM to construction, but these efforts have either
focused on macroprocess level, such as supply chains 共Arbulu
and Tommelein 2002; Fontanini and Pichi 2004兲 and project de-
livery 共Mastroianni and Abdelhamid 2003兲, or on single opera-
tion, such as masonry 共Pasqualini and Zawislak 2005兲 and
components manufacturing 共Alves et al. 2005兲. No report has yet
been found on the use of VSM for fundamental construction pro-
cess improvement.

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 A number of factors impede the application of VSM to the
main construction stream at the operational level. First, an under-
lying prerequisite for VSM is the repetition of the production
process. In manufacturing, hundreds of thousands of products in a
product family pass through similar processing steps, so it is fa-
vorable to develop and implement a lean system to continually
improve that process. A construction project, in contrast, presents
a unique design, specifications, and context, and must be con-
structed accordingly—following a unique construction process
共value steam兲. As VSM requires diligent management commit-
ment coupled with massive efforts in systematic data capture and
analysis, lean training, core implementation team assembly, and
working process transformation, practitioners have been hesitant
to invest such efforts to improve a process that may not recur.
Second, VSM is a quantitative tool that uses a list of process data
to depict the current state of the process and to determine what
the future state will be. Construction companies, however, gener-
ally do not fully track construction processes. Moreover, most of
the construction steps are lengthy and subject to numerous vari-
ables. Site investigation is useful to assist researchers in under-
standing the process, but it has proven nearly impossible to
collect statistically meaningful data in a short time period. Third,
key concepts/elements used in VSM, such as cycle time, change-
over time, up-time, and inventory, are defined in the context of
manufacturing and seem nonapplicable to construction.
Although construction industry as a whole is defined very
differently from manufacturing, home building, as a unique sector
in construction, provides the closest analogy to automobile pro-
duction 共Winch 2003兲. Its distinctive features, including high
production volume 共repetitiveness兲, controllable production flow,
and large inventory of work in process, make the application of
VSM here favorable 共Yu et al. 2007兲. In the research, a seven-
step methodology is adopted: 共1兲 data collection and value stream
selection; 共2兲 current-state mapping; 共3兲 existing practice analysis
and lean metrics development; 共4兲 formulation of lean production
model; 共5兲 laboratory testing of the model using simulation; 共6兲
kaizen 共continuous improvement兲 plan development; and 共7兲
implementation of kaizen plans and results evaluation. This paper
focuses exclusively on the first four steps, especially current-
state mapping and formulation of the lean production model;
simulation and the lean implementation are briefed to provide
integrality.
Data Collection and Value Stream Selection
An important rule in VSM is to bring the stopwatch when walk-
ing along the actual pathways of material and information flow,
and to rely only on information obtained firsthand 共Rother and
Shook 2003兲. This rule, however, is not applicable in construc-
tion. High variability in task durations as well as queuing times
and complexity in the construction process make it impossible for
a small team of researchers to collect sufficient data merely
through site observations. Instead, an intranet-based production
tracking system was developed, in which site managers recorded
the booking date, confirmed start date, actual start date, and actual
finish date of every task in the construction process. This research
used production data collected in 2006—approximately 400
houses for each task. Based on the data, four basic measurements
were calculated: 共1兲 cycle time 共CT兲; 共2兲 booking time 共BT兲; 共3兲
lead time between tasks 共LT兲; and 共4兲 percent started on schedule
共PSS兲. Table 1 shows the definitions and calculation formula of
these measurements and other key VSM elements used in the
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research. The writers have redefined most of the concepts used in
traditional VSM to suit the context of construction, and have de-
signed two new measurements 共BT and PSS兲 specifically for the
application of VSM in construction.
In addition to data collection, two management decisions must
be made prior to the commencement of VSM: 共1兲 select a value
stream; and 共2兲 decide on the level of mapping. A value stream is
a series of activities required to bring a product or service from
raw state through to the customer. As a manufacturing plant usu-
ally fabricates multiple products—each by a unique transforming
process, the product family with the highest production volume is
generally selected as the target on which to focus improvements
共Tapping et al. 2002兲. The products of a home building company,
on the contrary, can be seen as a single product family, because
they are generally constructed following similar processing steps
and utilizing the same subtrade pool. However, the housing con-
struction process is a complex system that involves tens of trade
contractors and consists of hundreds of construction activities. A
single map encompassing the entire process would be too large
and cumbersome for a VSM team to handle. In fact, a rule of
thumb for VSM is that the target value stream should include no
more than 12 tasks 共or process stations兲. A feasible solution is to
divide the entire production flow into stages, with each stage con-
sidered as an independent value stream in a supply chain. Another
reason to compartmentalize the construction process is that the
process is too long to be synchronized with one takt time. For
example, it is obvious that the capacity of excavation trade work-
ing at the beginning of the process needs to match the current
pace of sales, but for finishing trades at the tail end of the process,
their production pace should be synchronized with the pace of
sales that had occurred 6 months ago. Based on the analysis of
historical data, the writers recommend that the total production
duration of a stage be shorter than 2 months.
Level of mapping is another important issue to be considered
in defining the value stream. In manufacturing, mapping generally
begins at the level of the production process in a single plant, with
the activity box indicating a continuous product flow. In other
words, the tasks in the map are divided at the places where the
product flow stops and in-process inventory accumulates. In con-
struction, the houses 共products兲 do not move along a production
line but, rather, workers move from one house 共product兲 to an-
other. Thus, the operations of a trade crew can be regarded as a
continuous flow and would be shown with one activity box on the
map.
As shown in Table 2, the entire house production process was
divided into five stages after considering the size requirement of
the value stream map, total production duration, and the logical
relationship between the construction activities. The summary
data shown in Table 2 clearly demonstrate that Stage 1 is the most
problematic segment. The scheduled duration of Stage 1 is
20 days, but houses actually spend an average of 73 days 共365%
of the scheduled duration兲 in this stage. In addition, a large stan-
dard deviation 共35 days兲 indicates that the construction process in
Stage 1 was not effectively controlled and that a high potential
exists to reduce construction time by redesigning the process.
Based on the above-presented analysis, Stage 1 was selected by
the VSM team as the target value stream.
Current-State Mapping
The goal of current-state mapping is to create a clear picture of
the existing production process and to expose wastes. The con-
Table 1. VSM Key Elements
Key concepts Definitions Formula
Cycle time 共CT兲 The duration that a subtrade needs to complete its work CT⫽actual finish date⫺actual start date
package.
Booking time 共BT兲 The time that a subtrade needs to deploy its crew to a BT⫽confirmed start date⫺booking date
given job.
Lead time 共LT兲 The time that elapses between one task being completed LT⫽actual start date of task i + 1⫺actual finish date
to the next task being started. In lean system, LT serves of task i
as a time buffer to shield downstream crews from
upstream variability.
Percent started on A measure of the proportion of start-date promises made PSS⫽number of tasks started on schedule/
schedule 共PSS兲 by subtrades that are delivered on time, in percentage. total number of tasks
Changeover time The time that a crew needs to switch from working at
one house to another, including demobilization and
mobilization.
Uptime A measure of the proportion of available production Uptime= 共APT− bad weather days− changeover time兲/APT
time 共APT兲 that is actually used on construction, in
percentage.
Work in process 共WIP兲 Number of uncompleted houses in the value stream,
including the houses in construction and those standing
idle waiting for the start of next activity.
In-process inventory/ The backlog of ready houses that stands idle waiting for Number of houses in inventory= LT/ operational
supermarket yield the start of a given task. In lean system, it serves as a takt time
buffer to protect the continuous work flow of
downstream crews.
Yield The percentage of houses that go through an operation
correctly, without any rework.
Takt time The rate at which a home builder must build the house
to satisfy customer demand.

ventional approach of residential construction management is
based upon a management model which views the construction
process as a series of tasks to be completed in sequence 共Bashford
et al. 2005兲, and each house is scheduled and managed individu-
ally as a small project using a Gantt chart or critical path method.
Fig. 1 illustrates the conventional approach using predefined
icons of VSM. It was drawn up in a 2 day VSM session attended
by the lean team and an external lean expert. The information
recorded in the data box was estimated by site managers in the
session and then verified by researchers using historical data
which had been collected through the cooperating company’s pro-
duction tracking system. A statistical software, Stat::Fit, was used
to process the data. The map shows the main flow of Stage 1,
where 11 trade crews 共represented by activity boxes兲 are in-
volved. The process can be thought of as one house passing
through a line of process stations. Unlike with manufacturing,
attributes of each task are not a constant, but are expressed in
the form of distribution in order to reflect the variability of the
construction process. Site managers are the center of production
control. Due to the unpredictability of both the market and the
construction process, home building is essentially a “make-to-
order” business. No overall production schedule exists in the
home building company, and construction is triggered when the
file of a new house is released by sales. Subsequently, the respon-
sible site manager starts booking material and subtrades and tries
to push the process as quickly as possible. Meanwhile, no look-

Table 2. Construction Stages and Descriptive Statistics

Stage 1 Stage 2 Stage 3 Stage 4 Stage 5
Attributes foundation lock-up interior and siding prefinals finals
Start task Stake out Framing Verandahs, smart board, Plumbing prefinal Tile flooring
and rear deck and water test
End task Drill and place piles Roofing Drywall taping House clean and vacuum House possession
Number of tasks 11 11 11 12 14
Actual duration average 73 31 54 42 26
共calender day兲
Standard deviation 35 14 20 14 7
Coefficient of variation 共%兲 48 45 37 33 27
Scheduled duration 20 25 22 18 16
共calendar day兲
Difference 共actual⫺schedule兲 53 6 32 24 10

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 Fig. 1. Current-state map of home building process 共Stage 1兲
ahead schedule is available for trade contractors. The booking
information is generally issued by site managers via phone or fax
on a task-by-task basis.
Existing Practice Analysis and Lean Metrics
Development
Upon drawing up the current-state map, several wastes can be
identified immediately. In this case, the first observation was that
lead times were very lengthy. The total duration of Stage 1 was
found to be 65.5 workdays, but the total lead time accounted
for 50 workdays. This means that houses in construction stand
idle about 76% of the time, with no construction activity on site.
One apparent cause of long lead time is the high level of variabil-
ity of the process. The booking times and cycle times in the map
are very variable. Six of 11 booking times have a standard devia-
tion in excess of 5 days and cycle times of five tasks must be
described using statistical distributions. In the current practice,
site managers book the downstream subtrade immediately fol-
lowing confirmation of the start date of the upstream tasks. The
intention of this practice is to crash construction duration by
overlapping booking time and task cycle time, but the actual re-
sult is that nearly half of the tasks cannot begin on the scheduled
start date 共the average PSS on the current-state map is 54%兲.
Temporary contract relationship between home builder and trade
contractors make any delay in schedule be magnified by ripple-
through effect. For example, bad weather 共e.g., heavy rain兲 pre-
vents the excavation from commencing on the confirmed date for
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a given house. As the excavation subtrade has already scheduled
other jobs on consecutive days for other home builders, the de-
layed job has to be rescheduled to the end of its working sched-
ule. Moreover, as the downstream task 共in this example, pouring
of footings兲 cannot begin until the excavation is complete, the site
manager has to cancel original bookings and attempt to get new
commitments based on the newly scheduled excavation date.
However, from the perspective of the footing contractor, a sudden
schedule change means that it must find a new job fitting in that
time slot in a very short period of time. Then, overbooking 共i.e.,
subtrades accept jobs exceeding their capacity兲 has become com-
mon practice. Consequently, a greater number of tasks fail to
begin on the scheduled start date and lead time becomes even
more unpredictable.
Second, variations in cycle time are relatively high, especially
for tasks whose cycle times are described in distributions. Site
managers have reported that the major cause of high variation is
not work-load differences between house models but the manner
in which subtrades carry out their respective jobs. They tend to
deploy their crews continuously on new jobs where large quanti-
ties of work are available, leaving uncompleted, minor details to
rework crews. These rework crews follow separate working
schedules and usually arrive several days later to finish the job.
Quality problems are another cause of high variation in cycle
time. It has not been rare, for example, that the crews who install
the main floor spend 1 day cleaning the beam pockets and level-
ing the top of the foundation walls.
Based on the analysis of current practice, the aim of lean
initiatives for the cooperating company was set as increasing
Table 3. Lean Metrics
Metrics Baseline
Variation of production cycle time 共workdays兲 Up to 5
Total lead time 共workdays兲 50
Value-added ratio 共%兲 17
Percent started on schedule 共PSS兲 45–77
Yield 共%兲 50–98
a
Decided after future-state mapping.
productivity by stabilizing the process, reducing lead time,
and eliminating defects. Accordingly, the lean metrics shown in
Table 3 were developed in order to clarify these goals and track
progress.
Future-State Map
The focus of future-state mapping is to eliminate the root causes
of wastes and to link the value stream in a smooth flow. Unlike
manufacturing, where the fundamental problem is overproduction
caused by “batch and push” 共Womack and Jones 1996兲, the home
building industry suffers most from variability. Unpredictability
of the process causes all kinds of waste, not just of long lead
times and excess inventory. Uncompleted houses are vulnerable
to weather, requiring temporary protection; to pilferage, requiring
security and extra materials; and to vandalism, causing rework.
Variability also results in fluctuation of the production flow. This
means that home builders need to sustain a large workforce pool
and cannot provide stable work flows to trade contractors. In
Fig. 2. Future-state map of home building process 共Stage 1兲
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order to reduce the variability of the process, the following four
Goal a measures were taken in the future-state mapping 共Fig. 2兲: estab-
lishing a production flow and synchronizing it to takt time; lev-
1 eling production at pacemaker task; restructuring work; and
25 improving operation reliability with work standardization and
25 total quality management.
90
100
First-in, First-out Lane-Based Flow and Its
Synchronization
In manufacturing, continuous flow forms the centerpiece of the
lean production system and is regarded as the most effective way
of production. Nevertheless, the production system built on con-
tinuous flow can only be used for a reliable process. As the sys-
tem is fully synchronized, any small delay or breakdown in one
operation will result in halting the entire system. Housing con-
struction is a site-based production 共as opposed to factory-based
manufacturing兲. Weather and site conditions have a significant
impact on the execution of construction activities, so variation in
task duration is unavoidable. In addition, the housing construction
process is a long process involving more than 60 work “pack-
ages” 共tasks兲. Connecting all the tasks into a continuous flow
would make the system very fragile. Finally, construction work is
performed by various trade contractors who have individual inter-
ests and are almost exclusively concerned with the efficient ex-
ecution of their individual tasks 共Bashford 2004兲. Therefore,
keeping an excess capacity buffer to overcome minor flow fluc-
tuation is not practical for home builders.
Another important lean tool, supermarket-based pull flow, is
also nonapplicable in house construction. A pull-flow system is
 Wed Thu Fri Sat
Production
Slot
2 jobs
Jobs Lead time: 3 days
booked
1 job
booked Lead time: 2 days
2 jobs
Lead time: 2 days
booked
Fig. 3. Typical scenario of lean booking
controlled by the pacemaker task, where customer orders enter
the production system. In manufacturing, the pacemaker is typi-
cally the most downstream task in the value stream and the pro-
duction pace of all upstream tasks is “pulled” by the pacemaker.
In construction, the pacemaker acts at the beginning of the pro-
cess. In order to develop a stable flow from the pacemaker task to
the downstream end of the value stream, a FIFO-lane-based flow
system is proposed based on the theory of last planner described
by Ballard 共2000兲.
With the help of statistical analysis, the construction manager
of the company can predict with great certainty the total number
of houses that will enter the production system in the course of a
given month, but it is virtually impossible for site managers to
know with any certainty what the state of a given house will be
more than a week into the future; there are simply too many
variables that can affect the readiness of a particular job: weather,
work progress, material supply, trade availability for preceding
tasks, neighboring construction activities, etc. The fundamental
idea of the proposed system is to stabilize and reduce lead time by
guaranteeing trade contractors’ working load. In practice, this is
realized using agreed capacity, a commitment between a home
builder and its trade partner on the number of jobs 共kanban slots兲
that a subtrade will perform each week. For example, a home
builder might predict that about 40 houses would enter the pro-
duction system next month and it might have two trade partners
working for a given task. Next, a trade booking agreement is
signed between the company and each trade partner. Assuming
that one trade contractor has agreed to provide six kanban slots
weekly and the other four, a typical booking scenario would be
the one shown in Fig. 3. Site managers release specific job infor-
mation following the completion of the preceding task and load a
kanban slot. The capacity agreement in fact forms a first-in, first-
out 共FIFO兲 lane, and the jobs released are the inventory on the
lane. In this way, the FIFO lane links two separate tasks into a
stable flow. In the future-state map, the cycle time 共CT兲 and
changeover time 共CO兲 of each task remain the same as those in
the current-state map, and the booking time 共BT兲 reflects the
length of the FIFO lane.
The number of kanban slots is decided by takt time, which is a
function of customer demand. In the cooperating company, it usu-
ally takes 30– 45 days from the customer signing the purchase
agreement to the release of the file package to construction, so the
average volume of sales in the past 2 months is used to determine
the takt time of the system. In the first 2 months of 2007, the sales
volumes of the company, including presales and spec houses,
were 47 and 42, respectively. As 22 workdays are available in
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Sun Mon Tue Wed Thu Fri Note
Slot 1 Slot 2 Slot 3 Slot 4 Slot 5
Trade Partner 1
Slot 6
Slot 7 Slot 8 Slot 9 Slot 10 Trade Partner 2
Job are released
by preceding task
one day before
booking.
3 jobs
Lead time: 2/3 days
booked
2 jobs Lead time: 3 days
booked
March, the takt time is 0.49 workdays. In practice, the downtime
was estimated as 5%, and the agreed capacity of each task was
designated as 10 per week. By reserving the same number of
kanban slots for each of the tasks in the value stream, the produc-
tion paces of working stations are synchronized.
The FIFO-lane-based approach is different from other sched-
uling techniques for repetitive construction activities, such as line
of balance, due to its ability to deal with the dynamic work
flow—i.e., new houses can enter into the production system
continuously—and high variation in productivity. In this system,
consecutive tasks are decoupled by the FIFO lane so that each
task only deals with variations caused by the preceding task,
which can be accommodated by adding a time buffer 共LT兲 be-
tween tasks. For instance, task “Excavation and deep service” has
1 day standard deviation in cycle time and a possible 2 day delay
in booking time; thus a 3 day lead time for the next task can
effectively control the flow fluctuations caused by variations in
the present task. In addition, the system is very flexible. Either
party can change the agreed capacity from time to time provided
that advanced notice is given 共in practice, the agreed upon notice
time for capacity change is 2 weeks兲.
Production Leveling
In the conventional production management approach, the vol-
ume of jobs performed typically occurs unevenly overtime. Fig.
4共a兲 shows the monthly volume of files released to construction in
2006, and Fig. 4共b兲 shows a typical record of the number of
released files over a 1 month period. The causes of this large
fluctuation were unpredictability of sales and a pushed production
management. Flow fluctuation causes several problems for a syn-
chronized production system:
• There is no sense of takt time and it is difficult to decide the
capacity requirement;
• When peaks and valleys frequently appear, filling the agreed
kanban slots consistently becomes a heavy burden; and
• A jangled flow makes the production difficult to monitor—“Is
the situation normal or not?”
In order to avoid these problems, the production control must
lower the peaks and raise the valleys in work load as much as
possible so that the flow surface is smooth. This practice is re-
ferred to as production leveling or “even production flow.”
Bashford et al. 共2003兲 have described two common even
production flow strategies 共activity based and start based兲 and
discussed their implications for the housing industry using simu-
lation. In this research, these two strategies were combined and
 Fig. 4. Typical record of files to construction
implemented in an innovative way. On the one hand, tasks
connected by the FIFO-based lanes form an activity-based even
flow system. Unlike fixed schedules, where a long duration
for each task must be chosen in order to ensure that it will not be
exceeded, a booking system based on the agreed capacity had the
capability to accommodate minor variation, so that time buffers
between construction tasks were significantly reduced. On the
other hand, a supermarket-based pull system was established
between the pacemaker task 共excavation兲 and sales as a decou-
pling buffer 共Ballard et al. 2003兲. The sales department typically
releases the files of presale houses to the first supermarket,
and the downstream task withdraws the files. Once the number of
files in the supermarket reaches the upper limit, the sales must
stop releasing, and when the number reaches the lower limit, the
sales releases the files of show homes and spec houses in small
and consistent quantities until the files of presale houses are
available. The upper and lower limits are decided based on the
historical analysis of sales variability. In this research, they
were set to 15 and 5 homes 共7.5 and 2.5 workdays inventory兲
respectively.
Work Restructuring
It is apparent that the total lead time can be effectively abated by
reducing the number of handovers. In an extreme case, if the
entire value stream could be completed by a single crew, the
house would pass directly from one task to the next in a continu-
ous flow, without any lead time in between. The factor that pre-
vents the same crew working continuously in a house throughout
the value stream is that different tasks require different skills and
equipment. Although multiskilling and the use of cross-functional
teams were shown to be effective in reducing variability and thus
improving flow 共Ballard 2001兲, the reality is that the vast majority
of trade contractors are specialized in one type of job.
A feasible solution is to examine adjacent tasks and consider
the possibility of integrating them into one work package to be
performed by a single working team. The footing and cribbing
tasks, for instance, require a similar skill set 共framing and con-
crete pouring兲 and can easily be completed by one crew. Histori-
cally, these two tasks have been performed separately, because
it is more productive to pour footings in batch 共where multiple
footings are poured within a subdivision at one time兲 and wall
forms are always moved around with the cribbing crew. On the
future-state map, these two tasks are combined into one work
package with an expected cycle time of 4 workdays. Compared to
a savings of 3 workdays lead time, the possible cost increase
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due to the small amount of concrete pouring and underutilization
of wall forms is minor. The same strategy was also used for
electrical panel installation and shallow services, which were both
electrical jobs. In fact, this work package was further integrated
with backfill tasks to be contracted to a cross-functional team.
The electrical, cable, and telephone 共shallow service兲 lines are
approximately 1 m 共3 ft兲 below finished grade. By installing them
at the same time with backfill, trenching operation is eliminated
and the quality of backfill is ensured. A similar consideration
led to the integration of task excavation and deep services 共water
and sanitary兲, which are situated at approximately 2.7 m 共9 ft兲
underground.
Process Improvement Measures
The production process on the future-state map exhibits signifi-
cant overall improvements. Total construction duration of the
value stream decreases from 65.5 workdays to 38.5 workdays,
amounting to a reduction of 27 workdays or over 5 weeks. The
percentage of waiting time drops from 76 to 65% and the value-
added ratio increases from 17 to 26%. However, achieving the
material flow envisioned in the future-state map requires that the
amount of inventory on FIFO lanes should ideally be stabilized
around six houses 共i.e., 3 workdays lead time兲 and never less than
four, so as to ensure that subtrades receive at least 2 workdays
notice. Based on the statistical analysis, PSS needs to be im-
proved from current 45–77% to upward of 90% and with standard
deviation of cycle time for each task reduced to 1 workday, so
that the probability that the cycle times of any two homes in a
series of six are longer than the average cycle time by more than
1 workday is below 10%. Although the actual probability of a
shortage of jobs in the FIFO lane to fill the kanban slots might be
much lower due to possible completion of previous delayed jobs,
focused attention on improving the reliability of the operation of
subtrades will be required. In practice, the following kaizen foci
were proposed by the core lean team:
• Work standardization—The work scope and quality standards
of each task are clarified in written documents and distributed
to related subtrades. The goal is “100% ready handover”;
• Total quality management—Trade contractors are required to
control quality at the source, completing all repair work before
workers leave the site, when site managers are required to
check quality as the construction is in progress. The goal is
“100% first-time-through”; and
• Long-term partnership with trade contractors—Lean imple-
mentation involves significant behavioral changes in all parties
 linked to the system. It will take time to build up trust between
parties, train workers, and change the mindset of personnel.
These items are marked on the future-state map using a kaizen
lightening burst icon. An advantage of VSM is that the process
improvement efforts become subordinate to the value stream de-
sign, as opposed to stand-alone improvement activities, so that the
lean team can focus on the improvements that have real impacts
on overall process performance.
Information flow is another important issue in VSM. Without a
fundamental change in information management, it would be very
difficult to operate a lean value stream. Unlike a manufacturing
production line, construction crews move from one house to an-
other that may be located miles away. Visual control cannot be
applied in housing construction the same way that it is in manu-
facturing. Using the concept of the heijunka box, the writers pro-
posed an internet-based “e-kanban” system, with a column of
kanban slots for each workday and a row of kanban slots for each
trade contractor. Site managers place a kanban with the link of job
information 共detailed address and technical drawings兲 into a de-
sired kanban slot when a job is ready. The corresponding trade
contractor then withdraws this kanban via the internet and allo-
cates a crew to the job. If a slot is not loaded 2 days prior to its
start date, or if a kanban is not withdrawn until the start date, the
construction manager will be aware of a production problem.
Simulation Experiment
In order to better understand the effects of the changes proposed
on future-state map and to find the proper value for parameters of
the system, a series of simulation experiments were undertaken,
using discrete event simulation models constructed in a Simphony
environment. Simphony was selected because it facilitates the de-
velopment of a special purpose template for a focus area of ap-
plication such that models with different configurations can be
easily built 共Hajjar and AbouRizk 1999兲. Although a complete
discussion of the simulation method and results is beyond the
scope of this paper, a brief description is given to show the roles
of simulation experiments in lean model verification and in the
formation of a lean implementation plan.
Utilizing the hierarchical feature provided by Simphony, the
writers have developed two “composite” modeling elements for
each task, one representing the current state and the other encap-
sulating the mechanism of FIFO lane. Simulation experiments
were conducted using models with different combination of these
two groups of elements. First, a model with all elements in group
one and a model with all elements in group two were constructed
to simulate the current state and future state, respectively. The
simulation results were consistent with the summary of statistics
on the maps, which provided a cross check on the theoretical
analysis. Moreover, as the computer simulation recorded richer
data, such as work-in-process 共WIP兲 and utilization of resources,
it helps practitioners to better understand the differences between
conventional and lean models in a more comprehensive way.
Simulation also plays a critical role during lean implementa-
tion. The future-state map describes the ideal state that the com-
pany is expected to achieve in a certain period of time, and in
most cases, it will not be possible to implement the entire lean
system at once. Interim lean models are needed throughout the
different phases of lean implementation. A good example is the
establishment of FIFO-lane-based flow. As subtrades are indepen-
dent of home builders, any change to the existing production sys-
tem has to be built on consensus. However, achieving consensus
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requires considerable time, and subtrades have disparate attitudes
toward innovation. Therefore, it became necessary to develop an
interim system, in which some tasks were connected by FIFO
lane and others by conventional pushed flow. What should the
minimum length of FIFO lane be to ensure that the kanban slots
are being filled? What are the implications of using this system?
Is production leveling necessary? The answers to these questions
were essential for management decision-making and could only
be answered using simulation. Details of different simulation sce-
narios and results will be reported in a subsequent paper.
Lean Implementation
The implementation of the future state is ongoing in the cooper-
ating company, which completed approximately 460 single-
family dwellings in 2006 in metropolitan Edmonton. To ensure
that the leader of the lean initiative has sufficient authority to
allocate the organization’s resources and to instigate changes
across various functions and departments, the general manager of
the company was designated as lean champion. A core lean team,
including researchers, the president of the subsidiary company,
construction managers, and site managers, was formed to lead
daily lean activities.
A yearly kaizen plan was formulated to break implementation
into steps and to provide a time frame for improvements. The
objectives of each step were outlined as follows:
• Standardize work packages and educate the subtrades to elimi-
nate handover problems;
• Implement total quality control to raise the yield rate to 100%;
• Develop FIFO-lane-based flow from excavation through to
drilling and pile placement with 1 week lead time;
• Develop an internet-based booking system;
• Establish supermarket-based pull flow between excavation and
releasing of construction files;
• Restructure work packages 共depending on the availability of
cross-function teams兲; and
• Reduce lead time between tasks to the level shown on the
future-state map.
Naturally, these steps are not listed in sequence. Some of them are
in fact interdependent and must occur simultaneously. At the time
of writing, a detailed construction procedure was developed in
collaboration with construction managers, site managers, and all
related trade contractors. As a result, the construction sequence
has been completely standardized and the handover problems
caused by coordination issues dramatically reduced. As for FIFO-
lane-based flow, nearly half of the subtrade contractors have
agreed to use the lean booking system and have accepted 1 week
lead time. The analysis of production data from the 15 houses that
passed through the value stream via FIFO lanes showed that total
construction duration had been only slightly attenuated, but that
the standard deviations of total duration and lead times had de-
creased dramatically. All of this means that the implementation of
the proposed model can significantly reduce process variability.
Detailed discussion on results of the implementation, the strategy
used by core lean team, lessons learned, and internet-based book-
ing system will be reported on in future work.
Conclusion
The housing construction process is a complex system that in-
volves numerous interrelated tasks performed by various trade
contractors. In current practice, houses in construction are treated
as a collection of small projects using a conventional project man-
agement method. The conflict between predetermined schedule
and unpredictable reality results in significant wastes in the sys-
tem. This research has focused on creating a stable production
flow rather than eliminating individual waste. VSM, a powerful
lean planning tool, was used to analyze the construction process
and restructure the production system. However, compared to
manufacturing, the home building industry poses some significant
particularities, making the direct application of VSM impossible.
This paper has explicated the major limitations of traditional
VSM and proposed a practical approach to utilizing VSM in a
construction setting.
Detailed production data were collected through an intranet-
based production tracking system and analyzed to assess cycle
time, lead time, booking time, and percent started on schedule.
Pushed scheduling and unpredictable process led to extremely
long lead time and low PSS. Thus, creating a stable production
flow became the top priority of future-state mapping. A FIFO-
lane-based system was used, in tandem with production leveling
at pacemaker task, in order to control the sources of fluctuation
and to provide a predictable flow to trade contractors.
Compared to the current state, the future-state demonstrates a
remarkable improvement in overall performance. With a stable
product flow, the capacity of each task is synchronized to takt
time and fast response to sales change. By restructuring work
packages, the number of handovers was reduced and total lead
time was further reduced to 50% of that of the current process.
The impacts of the changes proposed on the future-state map
were investigated using simulation experiments. The implemen-
tation of the proposed lean system is ongoing, and a significant
improvement in process reliability has been observed after the
establishment of FIFO lanes.
Acknowledgments
The work presented in this paper was supported by the Canadian
Mortgage and Housing Corporation 共CMHC兲 under the External
Research Program 共Grant No. 6585-A075-1兲. The writers are
grateful to the industrial research partner, Landmark Homes
共Edmonton兲, for providing access to production tracking data and
for assistance in lean system development.
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