The Case for Industrialization of the Construction Industry

By Akio

This post is an excerpt from the paper, “Industrialization of the Construction Industry,” by Dr. Perry Daneshgari and  Dr. Heather Moore of  MCA Inc.

Like many other industries the construction industry is under constant pressure to improve productivity, reduce cost, and minimize waste in the operation.

While the productivity in the manufacturing industry has improved by four hundred percent (400%) over the last century, the construction industry’s productivity has, in the best case, stayed flat or turned negative.

Tweet: Problem: Over the last 100 yrs productivity in the #AEC industry has, in best case, stayed flat. Solution: http://ctt.ec/mf0SU+ @3DSAECClick to tweet: “Problem: over the 100 yrs productivity in the #AEC
industry has, in the best case, stayed flat. Solution: industrialization”

One main reason for the improvement of the manufacturing and other industries’ productivity is the “Industrialization” of those industries. Industrialization of any industry will rely on the following five factors:

  1. Management of Labor
  2. Management of work
  3. Lean Operations
  4. Modeling and Simulation
  5. Feedback from the source

The driver for establishing and applying industrialization in manufacturing was the American Society of Mechanical Engineers (ASME) in the late 1800s and early 1900s. Currently no known association is leading this mission in the construction industry.

A marked result of the advancement in productivity of the manufacturing industry is the relative price of an automobile.  Whilst the cost of an automobile has gone from 140% in 1910 of the average national per capita income in the United States down to 33% in 2012, the cost of an average dwelling has gone up from 333% to 619% of per capita income during the same period.

Tweet: Since 1910 automobile production cost decreased 75%. The cost of a dwelling has doubled. Time to industrialize @3DSAEC http://ctt.ec/Urcfa+Click to tweet: “Since 1910 automobile production cost decreased
75%. Production cost of a dwelling has doubled. Time to industrialize”

This post is an excerpt from the white paper, “Industrialization of the Construction Industry,” by Dr. Perry Daneshgari and Dr. Heather Moore. Commissioned by Dassault Systemes and prepared by MCA Inc., this whitepaper focuses on industrialization of construction industry. It maps out the construction industry challenges, relates the history of industrialization in the manufacturing industry, and summarizes five critical aspects and approaches.

Download the whitepaper and start accelerating the “Industrialization of the Construction Industry” through lessons learned from manufacturing and other industries.

Tweet: The Case for Industrialization of the #Construction Industry @3DSAEC @Dassault3DS #AEC #BIM http://ctt.ec/Uz_OK+Click to tweet this article

 

Akio MoriwakiAkio Moriwaki
Dassault Systèmes’ head of global marketing for the Architecture, Engineering and Construction industry, Mr. Moriwaki led the launch of the groundbreaking Lean Construction Solution Experience and is a member of buildingSMART

Related resources:

Lean Construction Industry Solution Experience

Download Lean Construction Solution Brief

White Paper: Industrialization of the Construction Industry

MCA® Website

Nine Lean Concepts to Improve Project Outcomes

By Akio

 

Good is the enemy of Great” – Jim Collins

 

To expect better outcomes is a poor strategy. “Good enough” stifles creativity and innovation in project delivery. Achieving better outcomes requires a persistent, proactive effort from organizations that want to gain competitive advantage by providing more value to their customers.

Lean Project Delivery (LPD) is a production management‐based approach to project delivery that is applied from concept to start‐of‐operations. It is based on Lean principles and methodologies and is configured for the construction industry.

LPD structures work to maximize value and minimize waste by focusing the delivery team on optimizing the project as a whole. It redefines “control” from a command and control hierarchy that reacts to results based on lagging indicators, to a distributed control through established LPD operating frameworks which guide organizations in optimizing work planning and execution.

Tweet: #Lean Project Delivery means more value, less waste, and never settling for 'good enough' #AEC @3DSAEC @Dassault3DS http://ctt.ec/19J17+Click to tweet: “#Lean Project Delivery means more
value, less waste, and never settling for ‘good enough'”

Guiding Template for Lean Project Delivery

CornerCube Lean Project Delivery Graphic

From a delivery perspective, projects are unique: they are governed by multiple organizations; they need to create a high value physical asset starting from concepts; and their delivery is extremely dependent on an evolving team of participants working together. To successfully deliver a construction project, an operating Framework requires a structure that ensures integrated governance, enables the means to optimize value, and incorporates effective delivery strategies.

A Framework can be purposefully designed to drive value or it can develop ad hoc with less than desired results. An organization’s ability to successfully deliver its capital projects is of strategic importance. LPD improves the operational foundation of the delivery process by adding focus on value creation, reducing waste inherent in the construction industry, and addressing the gaps, conflicts, redundancies between conventional methodologies and production requirements.

Over the past decade, adopting the Lean Project Delivery approach has begun to transform the construction industry by proving its effectiveness in addressing the delivery challenges projects typically face and improving the manner in which the production of capital assets are managed.

Nine Lean Concepts to Improve Project Outcomes

To continuously improve outcomes, project performance, and increase value delivered, LPD embraces the Lean concepts appropriate for the construction industry. They include:

  1. Value from the perspective of the customer – The definition of the customer includes entities both internal and external to the organization. Each customer has his or her own set of requirements that must be considered.
    These customers may be ranked or have priorities and vary among end user customer, the commercial customer, the product customer, the stakeholders, construction managers, contractors, subcontractors, suppliers, and the worker.
    They are customers because their success is intertwined with the success of others; one organization’s actions have direct or indirect consequences to others.
  2. Projects are temporary production systems – Projects are discrete events whose configurations, locations, environmental conditions, etc. are as varied as the combination of organizations, people, processes, and products that come together to deliver it.
  3. Integrate and synchronize to create continuous workflow – working collaboratively as a collective project enterprise requires the elimination of silos which is the source of much variability and waste.
  4. Use “pull” techniques to plan and advance the project – work releasing work reduces the amount of waste caused by fragmentation and re‐The rule is to not start work until constraints have been removed, the work made ready to start, and a request made to begin the work.
  5. Lean principles apply but must respect the complexity and dynamics of capital projects – Information, design, supply chain, and final assembly flows vary for each project.
  6. Optimize the whole, strive for perfection – sub‐optimization for isolated gains of individual organizations or people leads to increased time and cost with lower quality and safety performance.
  7. Collaboration and learning environments are essential – co‐creation of solutions, impeccable coordination, and learning coupled with action leads to better solutions, continuous improvement, team structures, and effective communication.
  8. Projects involve humans interfacing with other humans and systems, recognize that projects are a network of commitments and require increasing relatedness – as humans we are not infallible and leveraging collective knowledge provides significant benefits and creates a supporting environment.
  9. Identify essential value streams and all delivery processes – understanding value streams and the steps in a delivery process leads to greater visibility of the production system that enables improvement to occur

This is an excerpt from the white paper “Lean Construction ‐ Advanced Project Delivery for the AEC Industry” from Dassault Systèmes’ Value Solution Business Partner CornerCube.

CornerCube is a Dassault Systèmes partner located in the San Francisco Bay area, offering Lean construction solutions, 3D technology solutions, and related technical services to the AEC industry.

 

Click to tweet this article.Tweet: Nine #Lean Concepts to Improve Project Outcomes | #AEC @3DSAEC @Dassault3DS http://ctt.ec/Pxh98+

 


 

Related Resources:

Lean Construction Industry Solution Experience

Lean Construction – Advanced project Delivery for the AEC Industry White Paper

Interview with CornerCube

Lean Construction Advanced Project Delivery: Blinded by Convention

By Akio

Delivery of capital programs involves a complex and dynamic integration of people, organizations, and systems. Breaking the silos that exist within projects and achieving a harmonious flow of work effort that exceeds value expectations (time, cost, quality, safety, functionality, form, and delivery experience) is a commonly sought desire.

Unfortunately, unintended consequences of conventional project management approaches are the development of silos and sub‐optimization of efforts that compromise delivering what customers and stakeholders originally wanted or needed.

CCwhitepaper

The moment the contracts are signed, participants (owners, designers, engineers, general contractors, design/build contractors, subcontractors, vendors, and others) set in motion forces that lessen their influence and control of the project.

* Owners want the risk of project execution to be with their designers and contractors.

* Designers and contractors cannot or will not carry all of this risk, so they transfer as much of the risk as possible to their sub‐consultants, sub‐contractors, and suppliers; and where possible back to the owner.

* Project contracts then attempt to protect each organization’s risk exposure and seek to limit interactions between parties for fear of losing control or a perceived advantage.

* Project participants are reluctant to intervene or participate in the planning, control, and management of others’ work for fear of taking back responsibility for its outcome.

* Effective working relationships have become supplanted by contract‐defined points‐of‐contact, staffing, and reporting requirements.

* Layers of contracts isolate the project participants from where project execution decisions are made. As a result, decisions and actions that affect the project value are being made with minimal visibility and/or accountability.

The contractors’ and subcontractors’ control of projects are severely compromised, and owners’ or designers’ ability to intervene on their own behalf to resolve problems or pursue improvement opportunities is greatly diminished. Fragmented decision‐making, weak collaboration and isolation of the project participants are conditions that work against addressing the complexity of today’s projects.

Even the most skillful and conscientious project managers with the most sophisticated programming tools are challenged to understand the total project information and work flow.

Without effective real‐time information exchange and work planning collaboration, each organization focuses on meeting its contract obligations with the limited information available to it. Inefficiencies, sub‐optimization and lost opportunities result from working in isolation, embedding waste in all forms and at great expense to the project.

Costs do not exist to be calculated. Costs exist to be reduced.” ‐ Taiichi Ohno, creator of the Toyota Production System

Tweet: Costs do not exist to be calculated. Costs exist to be reduced – Taiichi Ohno | #AEC #LeanCon @3DSAEC @Dassault3DS http://ctt.ec/93wzN+

Click to tweet: “Costs do not exist to be calculated.
Costs exist to be reduced – Taiichi Ohno”

Current project management approaches and closed systems do not address these problems. Owners who have experienced their projects running behind schedule will recall the frustration of not knowing

the precise cause of the delay or what has to be done to resolve it. Too often project participants are given inadequate, misleading, or unintentionally false information about the causes of delays to projects. Recovery plans are usually based more on hope than on rigorous analysis founded on hard data.

Because of the complex and dynamic nature of projects, we tend to blindly accept that each organization is capable of planning and executing the work they are contracted for in the most efficient and effective manner for the project. The reality is that project entities essentially act independently of each other.

The barriers that have developed have greatly diminished the ability of the Owner to influence project execution; either to resolve issues or pursue opportunities. The Owner pays significantly for the cost of embedded inefficiencies, accepts the consequences of flaws in project delivery, and hopes that retained risk can at least be contained within bloated budgets and contingencies.

This state of construction delivery is not what any rational organization should ever want. Adopting and relentlessly pursuing Lean Project Delivery is a proven approach for organizations to achieve better project outcomes.

Fernando Espana, President, Corner Cube, Inc.

Fernando Espana, President, Corner Cube, Inc.

To learn more, read the full white paper “Lean Construction ‐ Advanced Project Delivery for the AEC Industry” from Dassault Systèmes’ Value Solution Business Partner CornerCube.

CornerCube is a Dassault Systèmes partner located in the San Francisco Bay area, offering Lean construction solutions, 3D technology solutions, and related technical services to the AEC industry.

 

Click to tweet this article.Tweet: #LeanConstruction Advanced Project Delivery: Blinded by Convention | #AEC @3DSAEC @Dassault3DS http://ctt.ec/7ts5a+

 


 

 Related Resources

 Lean Construction Industry Solution Experience

Lean Construction – Advanced project Delivery for the AEC Industry White Paper

CornerCube White Paper image

 

 

 

 

 

 

 

Interview with CornerCube

 

 

 

 



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