“How do I cut costs and still deliver value for my customer?” The age-old question which may now have found an answer.
A recent report by Autodesk and Dodge Data & Analytics found that “57% of construction project spending equates to waste. (1)” There is clearly huge scope to improve this by embracing efficiencies in construction which will dramatically reduce waste. Embedding Lean will allow you to deliver business improvements as you strive for key efficiencies. Yes, this is a significant undertaking and a behaviour change journey, however there are four key benefits that outweigh the effort involved if implemented effectively.
- Deliver Customer Value
Having happy customers is what we all strive for. It allows you to reap the benefits of long–term customer loyalty and secure future work, whilst creating a positive brand image which helps to grow your customer base. Making sure customers feel they are getting value throughout project delivery should be your priority. So right from the outset, you need to define exactly what it is that your customer will value. Then, by focusing on this you eliminate wasteful activity that doesn’t directly add to valued customer outcomes. Implementing Lean Construction brings this focus throughout the value chain and means activity is outcome focused rather than contract-task oriented.
2. Less Waste. More Money
Waste costs money and should be recognised as anything which doesn’t add value for the customer in delivering the end product; this includes additional effort in transportation and materials storage. By operating delivery on a pull–basis embedded throughout your supply chain, you can ensure you only receive exactly what you need when you need it. Close communication is key and the pull–basis behaviours need to be understood and embedded in order to eliminate waste. Operating in this way also increases the likelihood of the project will being completed predictably and efficiently, allowing for better margins.
3. Run a Continuously Improving, Smooth Operation
Operating environments sometimes become difficult through defects, re-work and over-processing. Reducing these elements of waste and ensuring all tasks add value will result in improved efficiency and quality of production.
At the core of Lean is embedding a culture of continuous improvement. Taking the benefits of the lessons learned from one project to the next allows for improvements to be built on time and again, with reflection encouraged at all stages to strive for better next time.
A top tip would be to set up regular reviews or suggestion boxes for team members to input – often it’s the people on the ground with the best ideas. You can also embed a thinking culture which is focused on delivering value – Why am I doing this? Who is it a benefit for? If there is no benefit the activity is a wasted effort. By introducing these concepts, you are organically creating an improved decision–making ability (customer value focused) and improving project predictability.
A smooth operation makes space for collaboration. ‘Lean Construction industry’ defines Lean Construction as a collaboration-based system founded on commitment and accountability; this is a relationship–based approach that builds trust.
Through subsequent projects, partnerships grow stronger and more efficient in delivery. The Lean Construction Institute note: “Teams are integrated through collaborative tools and search for ways to eliminate waste — specifically at the hand-off of work. Teams seek to continuously improve through reflection. Lean/IPD processes are designed to remove variation and create continuous work flow to drive significant improvement in predictability and strongly encourages respect for all people involved.” (2)
4. Make a Better Environmental Impact
With the Green Agenda becoming more of a priority around the globe, the environmental impact of projects is increasingly at the forefront of customer value. By eliminating waste you reduce the impact on the environment. This is achieved through the reduction in raw material utilisation and also by planning fewer journeys and more mindful conversion of materials. The result will be reduced overall emissions. By moving to a lean approach, your company can make a positive change to the carbon footprint associated with project delivery.
Following the shake-up in our ways of working in 2020, many sectors are looking at how they can operate more efficiently. The benefits are clear and now is the time for construction to roll out a Lean strategy. If you need more information or would like a free consultation specific to your organisation contact DavidD@NineFeetTall.com