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Akio Moriwaki
Akio Moriwaki
As head of global marketing for the AEC Industry at Dassault Systèmes, Mr. Moriwaki launches and promotes groundbreaking Industry Solution Experiences including "Optimized Construction," "Façade Design for Fabrication," and "Civil Design for Fabrication." He is a member of buildingSMART.

Why Go Lean? GCs’ Reasons for Adopting Lean Construction Practices

March 20th, 2014 by Akio Moriwaki

McGraw Hill Construction, the Lean Construction Institute and Dassault Systèmes teamed up recently to produce an in-depth report on Lean Construction. Below is an excerpt of the report: the in-depth interview findings on “Drivers for Lean.”

In-Depth Interview Findings: Drivers for Lean

Business goals drive Lean adoption.  Click to Tweet

Tweet: GC Research: Among the varied reasons that companies adopt Lean practices in construction, many are related to how a company is perceived in the marketplace, including the need to stay ahead of the competition and the desire to be seen as a leader in this area.

These reasons, along with client influence, could also help companies secure contracts.

Trade contractors also mention the desire to work collaboratively and the ability to ensure constant improvement as key drivers for their businesses.

Other drivers relate directly to the desire to reduce waste, such as cutting costs and reducing projects schedules.

Important Drivers for Lean

Driver 1: Client Influence 

Clients play a critical role in driving the use of Lean practices on construction projects. All GCs cite client influence as a driver with one third identifying it as the most important driver.

Some note that healthcare clients have taken a lead role in pushing teams to pursue Lean.

While client influence is important, one GC says that client influence plays a much stronger role when a company launches its initial Lean pursuits. “We’re implementing [Lean] regardless of whether our clients ask for it or not,” the contractor said.

One trade contractor regards client influence as a critical factor now, but finds that this is the result of an industry shift over the last 10 years.

Driver 2: Need to Increase Profitability or Cut Costs

GCs are split on the importance of using Lean to cut costs. Two identify it as the most important driver of Lean adoption. Since the recession, fees for GCs have been depressed, and GCs need to cut costs to stay competitive, according to one contractor.

Another says that while cutting costs through Lean is always a factor, it is not a primary driver of its use. One contractor says cutting costs is not a driver at all and ranks it last among the list of potential drivers.

For trade contractors, the need to stay competitive is a far more prominent influence than the desire to increase profitability or cut costs.

Driver 3: Leadership Interest in this Area 

All GCs interviewed would like to be seen as leaders in Lean construction, in large part as a way to demonstrate that they are innovative firms, developing new means and methods.

Clearly, this could be beneficial when pursuing work from clients who are committed to Lean principles. Trade contractors place less emphasis on this area.

Tweet: Driver 4: Need to Keep Up With or Ahead of the Competition 

All GCs report that staying ahead of the competition is an important driver for adopting Lean construction practices. << Click to Tweet

“Anytime we get an RFP and it has something Lean in there, we have to show proficiency because we know other bidders will as well—it’s absolutely a driver,” one contractor said.

Trade contractors are unanimous in the importance of this factor as a driver for them, the only factor with that much influence across all the trade respondents

Driver 5: Concerns About Worker Safety

Over the years, GCs have paid increasing attention to safety concerns, and the prospect that Lean practices could improve safety is appealing to many experts.

Three GCs identified safety as a driver for adopting Lean practices. But opinions are mixed. One notes that while the company recognizes that improved safety can be an outcome of Lean, that factor does not drive its pursuit of Lean means and methods.

At least one trade firm attributes their initial interest in improved safety as a prime driver for their adoption of Lean practices because the approach to eliminating safety issues is to examine processes closely, and it therefore yields efficiencies as well.

Otherwise, their response to safety mirrors that of the GCs.

Driver 6: Need to Decrease Project Schedule

Through focused and detailed planning, many GCs aim to tighten up project schedules. Three GCs identify it as a driver with one saying it is a factor in its approach “especially in using Last Planner and production planning.” One contractor argues that it was not a driver for them and added that it “would be a silly reason to do it.”

Only one trade contractor considers decreased project schedule as a key motivator for their adoption for Lean, but only in terms of the way in which it allows them to compete more effectively and be less impacted by schedule changes foisted on them by firms upstream in the construction process.

Driver 7: Improved Sustainability or Better “Green” Results

While improved sustainability can be an outcome of Lean practices, GCs are divided in their views of it as a driver.

Two identify the prospect of improved sustainability as a driver. One contractor notes that his company has reduced its construction site waste by half since adopting Lean methods.

One expert, who oversees Lean adoption at his company, says he regularly works with executives in charge of sustainability measures. “We’re trying to take sustainability to this [higher] level. You need new methods to get there and this is one of them,” the contractor said.

Two GCs report that while it is an outcome, it’s not a driver. “Sustainability and green are important to us but for different reasons than Lean,” said one contractor.

Driver 8: Workforce Concerns (Availability of Skilled Laborers)

GCs generally do not see workforce concerns as a driver for Lean adoption today. No GCs identifies it as a driver. One says that while availability of skilled labor is a long-term concern, it is not a short-term driver of Lean.

Trade contractors are more divided.

While one regards this as the least influential factor discussed, while another describes the specific example of a project in which, without the ability to reduce their workforce onsite, the scarcity of skilled laborers would have prevented them from pursuing the job.

Drivers to Pursue Beyond Typical Lean Construction Practices

As companies look to expand the menu of options available to make their projects and organizations more efficient, many of the same drivers apply. Experts noted that their reasons for adopting these principles have evolved over time.

For many companies that have pursued Lean construction projects for several years, the initial efforts were focused on the field.

As those practices have taken hold, some firms note that they are doing more to drive Lean principles at a company level.

“There’s an understanding that you have to get beyond the cookbook Lean approach and the focus on tools,” said one GC. “It’s about looking at it as a management philosophy, which means you apply that to your entire organization.”

A trade contractor concurs, “Early on, it was about using tools, and today it is about culture.”

In the coming years, some GCs predict that their drivers will evolve, especially as clients become more knowledgeable about Lean and expect it on their projects. Trade contractors expect similar drivers to be in place, but with more data, less proselytizing will be necessary by firms engaged in Lean to persuade their project partners.

The Role of the Field in Pursuing Lean

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General and trade contractors recognize that workers in the field play a critical role in driving use of Lean construction practices.

Companies have taken a variety of paths to adoption.

In some cases, project managers and superintendents independently pursued Lean concepts.

In other cases, upper management initiated the strategy, calling on the field to implement Lean.

Whether it was a top-down or bottom-up approach to initiating the pursuit of Lean, all contractors generally recognize that field workers have to champion the cause for it to be effective.

“Our superintendents need to be the ones driving it,” said one expert. “If not, you can forget it. We absolutely have field leadership who believes it. They’ve seen the benefits on project sites, and they are insisting on continuing the path forward.”

Simultaneously, management serves to support those efforts, providing the necessary tools and training resources.

As field workers become more proficient in Lean practices, GCs expect workers in the coming years will refine their processes and make more incremental improvements to these means and methods.

Click to access the full report

Download the full SmartMarket Report, with our compliments.

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Lean Construction Institute
McGraw Hill Construction

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Categories: AEC, Business Processes, Collaboration, Dassault Systèmes, Lean Construction

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