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Lean thinking

NBS Information Specialist Michael Smith looks at Build Lean. Transforming construction using lean thinking (C696), released by CIRIA. But what is 'Lean Thinking', and how does it help the construction industry?

Build lean, written in the form of a novel, follows Steve, a senior leader in a construction business as he receives news of another failed tender.

This article looks at Lean Thinking, an approach that allows businesses to change the way they operate in order to improve quality and reduce costs, in the context of the new CIRIA report.

Origins of Lean Thinking

Taiichi Ohno (1912-1990) is credited as the father of Lean Production Management, a production approach he pioneered at Toyota shortly after World War II. The overall concept was to better organize and manage customer relationships, the supply chain, product design and development, and manufacturing operations.

The term 'lean thinking' was originally coined by Jim Womack and Dan Jones of Cardiff Business School when they were studying the success of the Japanese car industry.

In 2006, Sir John Egan's report Rethinking construction urged industry to 'get lean' and adopt the kind of efficient practices used by the Japanese car industry, where lean production is a way of life.

How is Lean achieved?

The key to Lean Thinking is that it works through direct intervention. This is a crucial feature because it means that change is immediate, obvious to the people who will have to sustain it, measurable and directly related to the actual needs of the business.

Lean theory is a concept challenging traditional business practices. It is best defined by the Department of Civil and Building Engineering at Loughborough University, a leader in academic research into Lean Thinking, as: 'a philosophy for working based on continuous delivering of better value to customers whilst increasing business profitability and competitiveness'.

Despite international efforts to adapt and develop Lean Thinking within the construction industry, uptake globally has been weak, with only pockets of activity in Denmark, USA, Chile, Brazil, Australia and the UK, although the theory behind it is showing signs of maturity.

In Build lean, while pondering what he can do avoid another failed tender bid, Steve comes across a comparative review of two of his company's recent projects. Both were similar, except that one significantly outperformed the other. The review says that this was achieved through adopting a Lean Thinking approach.

Steve was familiar with Lean, and re-familiarises himself with the concept. Putting aside his previous prejudices he begins to understand how the five concepts of lean thinking apply equally to construction:

  1. Identify customers and values – only a small fraction of the total time and effort in any organisation adds value for the end customer. By clearly defining Value from the end customer's perspective, all the non-value activities can be targeted for removal
  2. Identify and map the value stream – This represents the end-to-end process that delivers value to the customer; understand their needs and identify how you are delivering (or not) on them
  3. Create flow by eliminating waste – When the Value Stream is first mapped, only 5% of activities add value. Eliminating this waste ensures the product or service 'flows' to the customer without any interruption, detour or waiting
  4. Establish/Respond to customer pull – Understand the customer demand and create the process to respond to this, so that only what the customer wants when they want it, is produced
  5. Seek perfection – Creating flow and pull shows more and more layers of waste as the process continues towards theoretical perfection, where every asset and every action adds value for the end customer.

On a day-to-day basis, other keys to the success of Lean Thinking include:

  • Working on clearly defined areas of operation
  • Identifying a team of company people to lead the process
  • Emphasising performance measurement
  • Ensuring that suppliers, project team and company management are enthusiastic.

Lean Thinking hones working practices so that people, materials and resources operate together to eliminate waste, allowing the project to run at optimum efficiency.

Lean is not about stripping everything back to the bare essentials and then squeezing more out of what is left. The idea is to work smarter, not harder.

How the basic theory of Lean Thinking works

In Build lean Steve learns how to think about waste differently. In Lean Thinking, every activity undertaken can be considered in terms of whether it adds value or falls into one of the eight classes of waste:

  1. Overproduction
  2. Waiting
  3. Transportation
  4. Non-value-added processing
  5. Inventory
  6. Under-utilizing people
  7. Defects
  8. Motion.

By examining construction and non-construction examples, Steve develops a greater appreciation of the need to get processes right.

He re-learns how the rhythm of repeatable processes can be disrupted as a result of variation, unevenness and overburden. For example, if Lean Thinking strips two weeks from the structural construction time, then follow on trades need to be there two weeks early to keep up the momentum and hold on to the gains already made; any delay and these gains will slip through the project managers fingers

The 2003 report into the Construction Lean Improvement Programme (CLIP), by the BRE, cited cases where M&E contractors increased pipefitting times by 40% and electrical assembly times by over 15%, outlining the kind of savings that can be achieved.

The future of Lean Thinking

Back in the Build lean report, Steve begins to understand the potential of lean thinking, not just as a suite of tools for deriving point improvements, but as a means of improving performance at a project and organisational level.

He sets out to convince his colleagues by setting out how the application of Lean could benefit the organisation. He illustrates how their efforts must focus on creating the right climate to encourage internal and supply chain teams to adopt a lean thinking approach. However, it becomes clear to him that Steve needed to start with himself. To succeed, Lean Thinking would need to cascade throughout the organisation.

However, as Build lean points out, lean thinking is not easy to achieve without the support of colleagues and management; in fact, the whole company. Even then, it is a difficult ideal to maintain once it has been reached.

The report looks at this through Steve's eyes, as he receives disconcerting feedback that facilitators at all levels are experiencing resistance and struggling to make progress; the team have fallen into the trap of not developing an appropriate measurement system.

As they begin to deal with this problem, things eventually get on track and lean thinking soon becomes second nature across Steve's organisation and many of his supply chain partners.

It takes a lot of effort to make the technique of Lean Thinking work over a series of projects consistently. However, in these hard economic times, it may prove to be a very worthwhile and ultimately profitable exercise. Steve reconciles this knowledge by acknowledging that Lean Thinking is a continuous journey.

Further information

Report C696 Build lean. Transforming construction using lean thinking, CIRIA, 2011

Rethinking construction - the report of the Construction Task Force (Egan Report)

Design and construction - building in value

Construction Lean Improvement Programme (CLIP)
Overview of programme including coverage of case studies, a summary of services and workshop reports.

Lean Construction Journal
www.leanconstructionjournal.org.

Related NBS information:

Articles:

June 2011

 

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