smartmarket report focusing on industry innovation through ... · source: mcgraw hill construction,...

1 McGraw Hill Construction Confidential. All information presented © McGraw Hill Construction, 2013. All rights reserved.

November 12, 2013 3DEXPERIENCE Customer FORUM

SmartMarket Report Focusing

on Industry Innovation through

Lean Construction

McGraw Hill Construction Confidential.

All information presented © McGraw Hill Construction, 2013

All rights reserved.

Harvey M. Bernstein, F.ASCE, LEED AP Vice President, Industry Insights and Alliances

McGraw Hill Construction


Lean Construction Builds on Industry Best Practices &

Latest Trends

All these industry trends are important

aspects of a Lean Construction approach

3 McGraw Hill Construction Confidential.

Dassault Market Research Study Launched to

Understand Benefits and Drivers in Lean from the

Insight of Practitioners

► Participating contractors drawn from two

samples:

• MHC Industry-Representative

Contractor Panel (120 respondents)

• Members of the Lean Construction

Institute (73 respondents)

► Lean Practitioners defined as firms using

at least one of the following practices:

• Lean Construction

• Pull Planning

• Last Planner System

• Just-In-Time

• Toyota Way

• Six Sigma

Definition of

Lean

Construction:

Elimination of

waste from

construction

processes


Agenda

Understanding Lean: A Gap

Benefits and Drivers of Lean Construction

Collaboration and the Tools that Support Lean

Key Recommendations for Future Actions


Understanding Lean: A Gap


Familiarity with Lean Construction and Specific

Practices

Not Familiar With Familiar With Implemented

58%

66%

54%

73%

70%

48%

38%

24%

31%

18%

15%

29%

4%

10%

15%

9%

15%

23%

Six Sigma

Toyota Way

Just-In-Time

Last Planner System

Pull Planning

Lean Construction

Over one third are not familiar with any of these specific practices


Perspective of Contractors About the Efficiency of

Construction Processes

14%

26% 55%

Not Familiar with Lean Practices

Inefficient/Very

Inefficient

Neutral

Efficient/Very

Efficient


Top Challenges to Lean Adoption or Implementation

39% 33% 32%

49%

Lack of Industry

Support/

Understanding of Lean

Belief That Lean

Takes Too Much Time

Lack of

Knowledge

Lack of

Knowledge

Non- Practitioners

Lean Practitioners 43% 40%

Lack of Sufficient

Support Across the

Project Team

Employee Resistance/

Belief Lean is Too

Complex


Lean Experts Find Culture Change Within Their

Organization One of Their Greatest Challenges

“Our superintendents

need to be the ones

driving it. If not, you

can forget it.”

Employee sign-off

is essential.

Engagement is

important.

“People get more engaged

in their work. They get

excited about coming in and

doing things everyday. That

turns into higher quality,

better safety and the things

that are tough to quantify.”


Prefabrication: Engaging Workers in Coordination

and Planning to Improve Efficiencies

We have these foremen in the room, and we need

their buy-in because if we don’t have it, they are not

going to do it anyway.

CASE STUDY

Project: St. Elizabeth Hospital

Contractor: Boldt Construction

► Worked with the field to evaluate use

of prefabrication based on supply

chain, schedule, safety, cost and

quality

► Engaged workers in creating more

efficient processes for installation,

including specially designed cart

► Early planning and employee buy-in

allowed them to calculate savings Bathrooms: Onsite man hours

reduced from 9.5 to 3

Headwalls: Total man hours

reduced from 24 to 7 per headwall

Benefits:


Benefits and Drivers of Lean Construction


Top Benefits of Using Lean Practices

According to Lean Practitioners

71%

74%

77%

77%

80%

84%

Better Risk Management

Reduced Project Schedule

Greater Productivity

Improved Safety

Greater Customer Satisfaction

Higher Quality Construction


Quantifiable Benefits from Lean

Reported by Lean Experts

“Our margins have

improved to expectation,

we’re taking the job at

four or five percent,

and we’re making four

or five percent.”

Consistent

Margins:

Reliability of

Outcome:

Reduced Project

Schedule:

Supervisory Staff

Can Focus on

Managing Workers:

“Reliability of

outcome has

changed from

about 20% to

about 80%-85%”

“The first project I

worked on…We did

it in 4.5 months

[instead of 6 months]

without any

overtime.”

“We have probably

found a 60%

increase in their

ability to directly

manage the labor

force”

4 to5 %


Lean Practitioners Report That Savings from Lean

Make Projects More Profitable

72%

24%

4%

Savings from Lean Contribute Directly to Bottom Line/Project Profitability (According to Firms With Reduced Costs/Increased Profits)

Disagree

Neutral

Agree

64% of Lean practitioners see reduced costs/increased profits due to Lean


Lean Experts Report that the Ability to Compete in a

Challenging Market Is a Key Lean Benefit

I can point to projects we’ve won because

of our experience with Lean. We’ve gotten

work with repeat clients…where they were

absolutely thrilled with the results and they

just handed us work.


Benefits of Conducting Value Stream Mapping

[Value stream mapping] deepens the knowledge of the

installation process and really improves communication

between the field and management because you are

collaborating together on this solution.

CASE STUDY

Project:

Installation of Light Fixtures at UCSF

Cardiovascular Research Building

Contractor:

Rosendin Electric

► Engaged field workers in study,

gathering their feedback

throughout the process

► Recorded every activity (value-

added and non-value added)

► Created a process map to identify

potential time savings

Benefits:

Process cost approximately

$2,000 in man hours to conduct

$$

Saved 15 minutes per fixture on

2,000 fixtures, roughly $50,000


Factors Most Influential for Non-Practitioners to

Consider Adopting Lean Practices

70%

70%

81%

83%

Higher Quality Construction

Greater Customer Satisfaction

Greater Productivity

Greater Profitability/ReducedCosts

Consistent with Benefits

Achieved by Lean Practitioners


Owners Are Increasingly Important Drivers for Lean

86%

11%

3%

Firms Use Lean Practices to Stay Competitive Because Owners Increasingly Expect Shorter

Schedules Lean Experts:

• Owners are showing

more familiarity and

expectation of Lean

today than 5 years ago

• Owners need to mandate

Lean to encourage wider

industry adoption

Disagree

Neutral

Agree

74% of Lean practitioners see reduced project schedules due to Lean


Collaboration and the Tools That Support Lean


Improving the Flow of Data Supports a Firm’s Ability to

Collaborate

33%

31%

77%

70%

35%

42%

62%

81%

Reduced Risk

Less Reliance on Blueprints/Specifications

Better Productivity

Better Collaboration AmongTeam Members

Source: McGraw Hill Construction, Information Mobility SmartMarket Report, 2013

Top Benefits Reported by Contractors of Improvements to

Information Mobility in the Last Two Years

General Contractors

Trade Contractors


Lean Experts Find Collaboration Critical to Improving

Efficiency and Implementing Lean

“For our pipe fitter to be

more efficient, we have

to be in-sync with how

the sheet rock

contractor is doing their

work because they can

ruin our efficiencies in a

heartbeat.”

Key to Achieving

Benefits:

Creates

Efficiencies:

Need Contractual

Support to Succeed:

“We think that our best

results [from Lean] usually

come in the form of

collaborative environments

where everybody wins and we

deliver a greater value when

things are done in the best

interest of all instead of the

best interest of one or two.”

“Absent the appropriate

contractual agreement….these

efforts were little more than

scheduling and did not involve

the collaborative and coordinated

involvement of all stakeholders,

so these projects quickly fall back

to traditional results and the

impact of the plan is never

realized.”


Prefabrication: Collaboration

The collaboration is a benefit in itself. It

brings the team closer from both a cost and

construction standpoint.

CASE STUDY

Project: Exempla Saint Joseph

Replacement Hospital

Contractor: Mortenson Construction

► Collaboration in early stages of project

allowed Mortenson to conduct intensive

prefabrication/ modularization:

► 25 foot long multi-trade corridor racks

► 15 standardized modular pods replacing

75 different bathroom configurations

► Designers and contractors worked

together in “Prefabrication Charrettes”

in schematics

► Use of Prefab enabled fast-track

schedule

Benefits:

Project currently running 6

months ahead of a traditional

project schedule

6 m o.a hea d


Tools to Support Collaboration:

Use of an Enterprise Resource Planning (ERP) System

Uses an ERP:

• Lean Practitioners: 51%

• Non-Lean Practitioners: 17%

ERP: Coordinates business management and project management data.

Firms with an ERP are More Likely to

Engage in Collaborative or Data-

Dependent Efficiency Practices:

•Offsite Prefabrication

•Using Studies of Worker Ergonomics/

Activities to Create Efficiencies

•Weekly/Daily Meetings with Workers

65%

23%

7% 5%

Degree of Support for Efficiency Efforts Provided by an ERP

Somewhat/Poorly Supported

Supported

Well/Very Well Supported

Not Sure


Better Tools to Support Internal and External

Collaboration Required

Of all tools used by highly

collaborative GC’s

interviewed, Custom

Database Systems were the

most effective in supporting

internal collaboration.

None reported a viable off-

the-shelf option.

Functions in Custom

Database Systems that

Effectively Support

Collaboration on Projects:

Seamless

sharing of

information

Ability to make

systems available

to project partners

Linking data

from past

projects to

new projects

Generating real-

time project

performance

reports

Leveraging

data from

BIM models


Research Supporting Lean and Key Recommendations for Future Action


Lean Construction Research Results on Safety Supported

by Results from Earlier Safety SMR Research

Source: McGraw Hill Construction, Safety in Construction SmartMarket Report, 2013

77% of Lean Practitioners Benefit from Improved Safety

Due to Lean Practices

Use of Prefabrication (an Important Lean Strategy)

Improves Construction Site Safety

63% report

improves

safety


Lean Construction Research Results on Risk Supported by

Results from Earlier Risk Management SMR Research

Source: McGraw Hill Construction, Mitigation of Risk SmartMarket Report, 2011

Integrated Teams (a Key Lean

Practice) Lowers Project Risk

71% of Lean Practitioners Benefit from Better Risk

Management Due to Lean Practices

77% report

decreased

risk due to

use of

integrated

teams


Intensive Prefabrication on Lean Projects Leads to Improved

Project Schedule and Budget—Supported by Lean Case Studies

Source: McGraw Hill Construction, Safety in Construction SmartMarket Report, 2013

Use of Prefabrication (an Important Lean

Strategy) Improves Schedule and Cost

63% report

improves

safety

65% report

lower

budgets

66% report

reduced

schedule

Top Sectors

for Prefabrication

1. Healthcare

2. Higher Education

3. Manufacturing

4. Low-Rise Office


Key Recommendations for Future Action

Spread the word about the benefits of Lean

Top Benefit According to Nearly All Lean Practitioners:

Greater Competitiveness

Top Drivers for Lean Also Widely Reported as Achieved Benefits:

Improved Productivity (77%) and Lowered Costs (64%)

Engage employees in Lean efforts

Create better tools that support collaboration

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at analyticsstore.construction.com

smartmarket report focusing on industry innovation through ... · source: mcgraw hill construction,...

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