D31PS Project Management Strategic Issues

UNIT 3
 Outline

 Lean thinking
 Lean Construction thinking and practice.
 Process Mapping
 Conclusions
 Lean Production

Definition:
‘Lean is a systematic approach to eliminating the sources of
loss from the entire value streams in order to close the gap
between actual performance and the requirements of
customers and stakeholders. Its objective is to optimise cost,
quality and delivery while improving safety. To meet this
objective, it tries to eliminate three key sources of loss from
the operating system: waste, variability and inflexibility.’ (Drew
et al 2004)

‘Lean’ thinking concerns ‘business process improvement’.

14 Principles of TPS
 Lean Principles

 Eliminate waste
 Precisely specify value from the perspective of the
ultimate customer
 Clearly identify the process that delivers what the
customer values (the value stream) and eliminate all non
value adding steps
 Make the remaining value adding steps flow without
interruption by managing the interfaces between different
steps
 Let the customer pull – don’t make anything until it is
needed, then make it quickly
 Pursue perfection by continuous improvement
Lean Principles
Lean Principles
 Lean tools and techniques

5S (Sort, Stabilize, Poka-Yoke

Shining, (Prevent
Standard work Set-up reduction
Standardize, inadvertent
Sustain) mistakes)

Heijunka (a
5 whys (to get to
technique to Value stream
the root of the Last Planner
reduce muda maps
problem)
(waste))

Policy Concurrent
A3 Target costing
deployment engineering
 The 7 Wastes- MUDA

1. Overproduction
2. Waiting
3. Transportation
4. Unnecessary processing
5. Unnecessary inventory
6. Unnecessary movement
7. Defects
 What is lean construction?

 Lean construction is a “way to design production

systems to minimize waste of materials, time, and
effort in order to generate the maximum possible
amount of value” (Koskela et al. 2002)

Where there is waste, there is opportunity

 Waste Opportunities

Research findings from the Construction Industry Institute (CII)- 2004:

 Why Process Maps?

 Processes underlay everything we do.

 Only understood processes can be improved.
 Understanding and improving processes is the key
to improving productivity.
 Understanding a process is easier when it can be
visualized.
 A Process Map is an organized visualization of all
the interrelated activities which combine to form a
process.
 Value added & non-value added activities

Value Added Activity

• Transforms or shapes material or information or people
• And it’s done right the first time
• And the customer wants it

Non- Value Added Activity - Necessary waste

• No value is created, but cannot be eliminated based on current
technology, policy, or thinking
• Examples: project coordination, regulatory, company mandate,
law

Non- value Added Activity – Pure waste

• Consumes resources but creates no value in the eyes of the
customer
• Examples: idle/wait time, inventory, rework, excess checkoffs
Value added & non-value added activities
 ‘Lean Production’ concepts

 Lean Production thinking argues that production consists of

CONVERSIONS and FLOWS
 BOTH ‘Conversions’ and ‘Flows’ expend costs and take time,
BUT;
 Conversion processes ‘convert’ raw materials (or components)
into products (or modules or sub-assemblies). We can also
suggest that the conversion of creativity into information in a
Design process would be a conversion process. Conversion
processes ADD VALUE.
 Flow processes usually support Conversion Processes.
Examples include transport, storage, movement etc. With a
few exceptions, these processes do NOT ADD VALUE.
 Process Mapping

 Only a small fraction of the total time and effort in any

organisation or project actually adds value for the end
customer.
 By defining value for a product or service from the end
customer's perspective all the nonvalue activities
(waste), can be targeted for removal
Conventional View
Performance improvement
Time Compression
 Towards Lean Processes

 Production and management processes

must be mapped and analysed

 None value adding activities (flow activities)

would then be subject to reduction or
elimination

 Value adding activities (conversion

activities) must be made more efficient
(Standardisation, Technology)
 Process Mapping

Identification of non value adding

activities (mapping of existing processes)

Standardisation (reengineering
processes)

Many standard ways by which a process

map can be presented (e.g. IDEF)
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 Process standardisation:
Construction Project Process

 RIBA Plan of Work

 British Property Federation Model (BPF)
 New Product Development (NPD) process
 The BAA project process
 Generic Design and Construction Process Protocol
RIBA PLAN OF WORK (2013)
Process Protocol
 Consists of 10 phases

 Phase 0: Demonstrating the Need

 Phase 1: Conception of Need
 Phase 2: Outline Feasibility
 Phase 3: Substantive Feasibility Study & Outline Financial Authority
 Phase 4: Outline Conceptual Design
 Phase 5: Full Conceptual Design
 Phase 6: Coordinated Design, Procurement & Full Financial Authority
 Phase 7: Production Information
 Phase 8: Construction
 Phase 9: Operation & Maintenance
 Lean benefits

 The expected benefits of Lean Production

Philosophies are:
 Reduced Costs
 Improved Profit or Increased Competitiveness
 Increase business opportunity and customer base
 Improved Health and Safety
 Improved Quality
 Higher Salaries (for employee’s)
 Shorter Production Timescales
 Increased Customer Satisfaction
 Does Lean work in
Construction?
 Recent Research has suggested that in the case of
Bricklaying alone, wasted activity accounts for 43% of all
‘operator’ time. As an example of the significance of this
finding a study which examined a bricklaying sub-
contractor who employs 30 bricklayers found that the cost of
wasted activity amounted to £418,000 pa. In the case of that
specific contractor, that figure equated to FIVE times the
annual profit achieved by the contractor.
 Other examples of what has been achieved in construction
through the adoption of ‘lean’ techniques:-
 Project delivery time: Reduced from 34 weeks to 20
weeks
 Project profit: Increased from £750,000 to £1,750,000
 % of projects delivered on time: Up from 56% to 82%
 Right first time quality: 42% improvement
 The way forward

 LEAN production does not necessarily advocate that

ALL waste can be immediately removed from ALL
processes.
 However, the central issues remain:
 IDENTIFYING WASTE in processes
 ACCEPTING THAT WASTE is WASTE
 Adopting a process of CONTINUOUS IMPROVEMENT to eradicate
or remove identified waste where it is technologically
achievable.

 It is accepted that it may not be possible to remove all

identified areas of waste using presently available
technology.
 The next step in ‘Leaning’ a production process may
be to invent and develop a NEW TECHNOLOGY which
removes waste and is more efficient.
Next week

 Lean Construction and Planning

 Last Planner