Lean construction

Lauri Koskela, in 1992, challenged the construction management community to consider the inadequacies of the time-cost-quality tradeoff paradigm.[3] Another paradigm-breaking anomaly was that observed by Ballard (1994[4]), Ballard and Howell (1994a[5] and 1994b), and Howell (1998). Analysis of project plan failures indicated that "normally only about 50% of the tasks on weekly work plans are completed by the end of the plan week" and that constructors could mitigate most of the problems through "active management of variability, starting with the structuring of the project (temporary production system) and continuing through its operation and improvement," (Ballard and Howell 2003[6]).

Evidence from research and observations indicated that the conceptual models of Construction Management and the tools it utilizes (work breakdown structure, critical path method, and earned value management) fail to deliver projects 'on-time, at budget, and at desired quality' (Abdelhamid 2004). With recurring negative experiences on projects, evidenced by endemic quality problems and rising litigation, it became evident that the governing principles of construction management needed revisiting. One comment published by the CMAA, in its Sixth Annual Survey of Owners (2006), pointed to concern about work methods and the cost of waste:

"While the cost of steel and cement are making headlines, the less publicized failures in the management of construction projects can be disastrous. Listen carefully to the message in this comment. We are not talking about just materials, methods, equipment, or contract documents. We are talking about how we work to deliver successful capital projects and how we manage the costs of inefficiency."[7]

The term lean construction was coined by the International Group for Lean Construction in its first meeting in 1993 (Gleeson et al. 2007). Greg Howell and Glenn Ballard (founders of the Lean Construction Institute in 1997) both maintain that Construction in Lean Construction refers to the entire industry and not the phase during which construction takes place. Thus, Lean Construction is for owners, architects, designers, engineers, constructors, suppliers & end users.

In any case, the term Lean Construction has escaped canonical definition. There has been a number of reasons for that. The body of knowledge is in a state of development since 1990. Nonetheless, a definition is needed to be able to operationalize the concepts and principles contained in the philosophy. It is insightful to study the change of definition over time as that represents the evolution and advancement in the state of knowledge about Lean Construction.

The reference to Lean Construction as a proper noun is not an attempt to falsely distinguish it from other areas that focus on construction project management. It is a proper noun because it refers to a very specific set of concepts, principles, and practices that are distinct from conventional design and construction management practices .

A number of groups have proposed definitions: The International Group for Lean Construction; The Lean Construction Institute; The Associated General Contractors of America; Construction Management Association of America, and others. Researchers have also put forward definitions as foundation for their work and to invite others to add, modify and critique. A sampling is provided here.

Lean Construction is a “way to design production systems to minimize waste of materials, time, and effort in order to generate the maximum possible amount of value," (Koskela et al. 2002[1]). Designing a production system to achieve the stated ends is only possible through the collaboration of all project participants (Owner, A/E, contractors, Facility Managers, End-user) at early stages of the project. This goes beyond the contractual arrangement of design/build or constructability reviews where contractors, and sometime facility managers, merely react to designs instead of informing and influencing the design (Abdelhamid et al. 2008).

Lean Construction recognizes that desired ends affect the means to achieve these ends, and that available means will affect realized ends (Lichtig 2004). Essentially, Lean Construction aims to embody the benefits of the Master Builder concept (Abdelhamid et al. 2008).

"One can think of lean construction in a way similar to mesoeconomics. Lean construction draws upon the principles of project-level management and upon the principles that govern production-level management. Lean construction recognizes that any successful project undertaking will inevitably involve the interaction between project and production management." (Abdelhamid 2007)

Lean construction supplements traditional construction management approaches with (Abdelhamid 2007): (1) two critical and necessary dimensions for successful capital project delivery by requiring the deliberate consideration of material and information flow and value generation in a production system; and (2) different project and production management (planning-execution-control) paradigms.

While lean construction is identical to lean production in spirit, it is different in how it was conceived as well as how it is practiced. There is a view that "adaptation" of Lean Manufacturing/Production forms the basis of Lean Construction. The view of Lauri Koskela, Greg Howell, and Glenn Ballard is very different, with the origin of lean construction arising mainly from the need for a production theory in construction and anomalies that were observed in the reliability of weekly production planning.

Getting work to flow reliably and predictably on a construction site requires the impeccable alignment of the entire supply chain responsible for constructed facilities such that value is maximized and waste is minimized. With such a broad scope, it is fair to say that tools found in Lean Manufacturing and Lean Production, as practiced by Toyota and others, have been adapted to be used in the fulfillment of Lean construction principles. TQM, SPC, six-sigma, have all found their way into lean construction. Similarly, tools and methods found in other areas, such as in social science and business, are used where they are applicable. The tools and methods in construction management, such as CPM and work breakdown structure, etc., are also utilized in lean construction implementations. The three unique tools and methods that were specifically conceived for lean construction are the Last Planner System, Target Value Design, and the Lean Project Delivery System.

If the tool, method, and/or technique will assist in fulfilling the aims of lean construction, it is considered a part of the toolkit available for use. A sampling of these tools includes: BIM (Lean Design), A3, process design (Lean Design), offsite fabrication and JIT (Lean Supply), value chain mapping (Lean Assembly), visual site (Lean Assembly); 5S (Lean Assembly), daily crew huddles (Lean Assembly).

The priority for all construction work is to:

1. Keep work flowing so that the crews are always productive installing product
2. Reduce inventory of material and tools and
3. Reduce costs[10]

While lean construction’s main tool for making design and construction processes more predictable is the Last Planner System (see below) and derivatives of it, other lean tools already proven in manufacturing have been adapted to the construction industry with equal success. These include: 5S, Kanban, Kaizen events, quick setup/changeover, Poka Yoke, visual control and 5 Whys (Mastroianni and Abdelhamid 2003, Salem et al. 2005[11]).

The early involvement of contractors and suppliers is seen as a key differentiator for construction so called 'best practice'.[12] While there are Trade Marked business processes (see below), academics have also addressed related concepts such as 'early contractor involvement' (ECI).[13]

Primary IPD team members include the owner, architect, key technical consultants, general contractor and key subcontractors.

In the UK, a major R&D project, Building Down Barriers, was launched in 1997 to adapt the Toyota Production System for use in the construction sector. The resulting supply chain management toolset was tested and refined on two pilot projects and the comprehensive and detailed process-based toolset was published in 2000 as the 'Building Down Barriers Handbook of Supply Chain Management-The Essentials'. The project demonstrated very clearly that lean thinking would only deliver major performance improvements if the construction sector learned from the extensive experience of other business sectors. Lean thinking must become the way that all the firms in the design and construction supply chain co-operate with each other at a strategic level that over-arches individual projects. In the aerospace sector, these long-term supply-side relationships are called a 'Virtual Company', in other business sectors they are called an 'Extended Lean Enterprise'.

The UK 'Building Down Barriers Handbook of Supply Chain Management-The Essentials' states that: 'The commercial core of supply chain management is setting up long-term relationships based on improving the value of what the supply chain delivers, improving quality and reducing underlying costs through taking out waste and inefficiency. This is the opposite of 'business as usual' in the construction sector, where people do things on project after project in the same old inefficient ways, forcing each other to give up profits and overhead recovery in order to deliver at what seems the market price. What results is a fight over who keeps any of the meagre margins that result from each project, or attempts to recoup 'negative margins' through 'claims', The last thing that receives time or energy in this desperate, project-by-project gladiatorial battle for survival is consideration of how to reduce underlying costs or improve quality'.

The Last Planner System, as developed by the Lean Construction Institute, is:

The collaborative, commitment-based planning system that integrates should-can-will-did planning (pull planning, make-ready, look-ahead planning) with constraint analysis, weekly work planning based upon reliable promises, and learning based upon analysis of PPC (plan percent complete) and reasons for variance.[23]

Users such as owners, clients or construction companies, can use LPS to achieve better performance in design and construction through increased schedule/programme predictability (i.e. work is completed as and when promised).

LPS is a system of inter-related elements, and full benefits come when all are implemented together. It is based on simple paper forms, so it can be administered using Post-it notes, paper, pencil, eraser and photocopier. A spreadsheet can help.

LPS begins with collaborative scheduling/programming engaging the main project suppliers from the start. Risk analysis ensures that float is built in where it will best protect programme integrity and predictability. Where appropriate the process can be used for programme compression too. In this way, one constructor took 6 weeks out of an 18-week programme for the construction of a 40 bed hotel. Benefits to the client are enormous.

Figure 1: intense discussion during a programme compression workshop

Before work starts, team leaders make tasks ready so that when work should be done, it can be. Why put work into production if a pre-requisite is missing? This MakeReady process continues throughout the project.

Figure 2: part of a MakeReady form for documenting the process of making tasks ready (this one for use in design)

There is a weekly work planning (WWP) meeting involving all the last planners – design team leaders and/or trade supervisors on site. It is in everyone’s interest to explore inter-dependencies between tasks and prevent colleagues from over-committing.

Figure 3: part of a Weekly Work Plan form used by trade foremen on site or design team leaders to prepare for the WWP meeting.

This weekly work planning processes is built around promises. The agreed programme defines when tasks should be done and acts as a request to the supplier to do that task. The last planners (that is the trade foremen on site or design team leaders in a design process) only promise once they have clarified the conditions of satisfaction and are clear that the task can be done.

Figure 4: the promise cycle (after Fernando Flores)

Once the task is complete the last planner responsible declares completion so that site management or the next trade can assure themselves that it is complete to an appropriate standard.

A key measure of the success of the Last Planner system is PPC. This measures the Percentage of Promises Completed on time. As PPC increases. project productivity and profitability increase, with step changes at around 70% and 85%. This score is measured site-wide and displayed around the site. Weekly measures are used by the project and by individual suppliers as the basis for learning how to improve the predictability of the work programme and hence the PPC scores.

A key part of the continual improvement process is a study of the reasons why tasks promised in the WWP are delivered late. The following chart shows typical reasons:

Figure 5: example of a reasons Pareto chart

Recording the reasons in a Pareto chart like the one above makes it easy to see where attention is most likely to yield the most results. Using tools like 5 Why analysis and cause-effect diagrams will help the team understand how they can improve the clarity of information and ensure that there are sufficient operatives.

Last Planner benefits don’t stop at project predictability, profit and productivity; it contributes to positive changes in other industry KPIs. Danish research shows almost half the accidents and up to 70% less sickness absence on LPS managed sites.

LCI retains a registered Trademark on the term and Copyright in the idea and materials to prevent people who misunderstand or misrepresent the system from using it in trade. Consulting companies or individuals wishing to use the Last Planner System in trade (commercial offering of service) must first be approved by LCI. Consultants are expected to make financial and other contributions to LCI in recognition of the work and effort LCI put into developing Last Planner.

Last Planner System development continues under the direction of Lean Construction Institute Directors Professor Glenn Ballard and Greg Howell with support from users around the world. For more information about the development process see Ballard (1994,[4] 2000) and Ballard and Howell (2004) for example.

For a detailed description and list of the benefits of LPS, see Mossman: Last Planner®: 5 + 1 crucial & collaborative conversations for predictable design & construction delivery[24] and for additional references see the Designing Buildings wiki.[25]

There are many differences between the Lean Construction (LC) approach and the Project Management Institute (PMI) approach to construction. These include:

• Managing the interaction between activities and combined effects of dependence and variation, is a first concern in lean construction because their interactions highly affects the time and cost of projects (Howell, 1999[26]); in comparison, these interactions are not considered in PMI.
• In lean construction, optimization efforts focus on making work flow reliable (Ballard, LPDS, 2000); in contrast PMI focuses on improving productivity of each activity which can make errors and reducing quality and result in rework.
• The project is structured and managed as a value generating process (value is defined as satisfying customer requirements);[26] while PMI considers less cost as value.
• In the lean approach, downstream stakeholders are involved in front end planning and design through cross functional teams (Ballard, LPDS, 2000). PMI doesn’t consider this issue.
• In lean construction, project control has the job of execution (Ballard, PhD thesis, 2000[27]); whereas, control in PMI method relies on variance detection after-the-fact.
• In the lean approach, pull techniques govern the flow of information and materials, from upstream to downstream;[27] with PMI, push techniques govern the release of information and materials.
• Capacity and inventory are adjusted to absorb variation (Mura). Feedback loops, included at every level, help ensure minimal inventories and rapid system response;[27] in comparison, PMI doesn’t consider adjustments.
• Lean construction tries to mitigate variation in every aspect (product quality, rate of work) and manage the remaining variation, while PMI doesn’t consider variation mitigation and management.[27]
• Lean approach tries to make continuous improvements in the process, workflows and product;[26] whereas PMI approach doesn’t pay that much attention to continuous improvement.
• In lean construction, decision making is distributed in design production control systems;[27] by comparison, in PMI decision making is centered to one manager some times.
• Lean construction tries to increase transparency between the stakeholders, managers and labourers, in order to know the impact of their work on the whole project;[26] on the other hand, PMI doesn’t consider transparency in its methods.
• In lean construction a buffer of sound assignments is maintained for each crew or production unit;[27] in contrast, PMI method doesn’t consider a backlog for crews.
• Lean construction is developing new forms of commercial contracts to give incentives to suppliers for reliable work flow and optimization at the deliverable-to-the-client level;[26] while PMI doesn’t have such policy.
• Lean construction production system design resists the tendency toward local suboptimization,[27] however, PMI persists on optimizing each activity.
• The PMI-driven approach only considers managing a project at the macro-level. This is necessary but not sufficient for the success of projects. Lean Construction encompasses Project and Production Management, and formally recognizes that any successful project undertaking will inevitably involve the interaction between project and production management. (Abdelhamid et al. 2008)

Various networks and institutes conduct research and teach Lean Construction.

• Abdelhamid (2007). Lean Construction Principles. Graduate class offering at Michigan State University. http://www.slideshare.net/tabdelhamid/lean-construction-introduction
• Abdelhamid, T., S. (2004). “The Self-Destruction and Renewal of Lean Construction Theory: A Prediction From Boyd’s Theory”. Proceedings of the 12th Annual Conference of the International Group for Lean Construction, 03-6 August 2004, Helsingør, Denmark.
• Abdelhamid, T.S., El-Gafy, M., and Salem, O. (2008). “Lean Construction: Fundamentals And Principles.” American Professional Constructor Journal.
• Ballard, G. and Howell, G. (1994a). “Implementing Lean Construction: Stabilizing Work Flow.” Proceedings of the 2nd Annual Meeting of the International Group for Lean Construction, Santiago, Chile.
• Ballard, G. and Howell, G. (1994b). “Implementing Lean Construction: Improving Performance Behind the Shield.” Proceedings of the 2nd Annual Meeting of the International Group for Lean Construction, Santiago, Chile.
• Ballard, G. and Howell, G. (1998). “Shielding Production: Essential Step in Production Control”. Journal of Construction Engineering and Project Management, Vol. 124, No. 1, pp. 11 – 17.
• Ballard, Glenn; Howell, Gregory A. (19–21 March 2003). "Competing Construction Management Paradigms" (pdf). Proceedings of the 2003 ASCE Construction Research Congress. Honolulu, Hawaii. Retrieved 31 March 2013.
• Ballard, Glenn (22–24 April 1994). "The Last Planner" (pdf). Northern California Construction Institute Spring Conference. Monterey, CA: Lean Construction Instsitute. Retrieved 31 March 2013.
• Ballard, Glenn (2000). Last Planner™ System of Production Control (pdf) (Ph.D.). UK: University of Birmingham. Retrieved 29 March 2013.
• Ballard, Glenn (2000b). “Lean Project Delivery Systems.” LCI white paper-8, (Revision 1)
• Bertelsen, S. (2003a). “Complexity – Construction in a New Perspective”. Proceedings of the 11th Annual Meeting of the International Group for Lean Construction, Blacksburg, Virginia, USA.
• Bertelsen, S. (2003b). “Construction as a Complex System”, Proceedings of the 11th Annual Meeting of the International Group for Lean Construction, Blacksburg, Virginia.
• Bertselen, S. and Koskela, L. (2002). “Managing The Three Aspects Of Production In Construction.” Proceedings of the 10th Conference of the International Group for Lean Construction, Gramado, Brazil, August 6–8.
• Cain, C. T. (2003). ISBN 0-415-28965-3. 'Building Down Barriers-A Guide to Construction Best Practice'. A simple guidebook explaining supply chain management and lean thinking, primarily aimed at the demand-side client.
• Cain, C. T. (2004b). 'Performance Measurement for Construction Profitability'. ISBN 1-4051-1462-2. A detailed action-learning guidebook aimed at supply-side construction firms (including trades contractors) explaining why performance measurement is the key to lean construction.
• Cain, C.T. (2004a). ISBN 1-4051-1086-4. 'Profitable Partnering for Lean Construction'. A detailed action-learning guidebook that explains how to set up the extended lean enterprises that are the essential first step towards lean construction. The book provides case history evidence that the approach advocated can deliver savings of over 30% and explains what clients need to do differently in order to enable lean construction to flourish.
• FMI/CMAA (2006). "Sixth Annual Survey of Owners" (PDF). Construction Management Association of America. Retrieved 31 March 2013.
• Fernández-Solís, J. L. (2008). The systemic nature of the construction industry. Architectural Engineering and Design Management, 4(1), 31-46.
• Fernández-Solís, J. L., Porwal, V., Lavy, S., Shafaat, A., Rybkowski, Z. K., Son, K., & Lagoo, N. (2012). Survey of motivations, benefits, and implementation challenges of last planner system users. Journal of construction engineering and management, 139(4), 354-360.
• Fernandez-Solis, J. L. (2013). Building construction: A deterministic non-periodic flow–A case study of chaos theories in tracking production flow. Architectural Engineering and Design Management, 9(1), 21-48.
• Fernández-Solís, J. L., & Rybkowski, Z. K. (2012). A theory of waste and value. International Journal of Construction Project Management, 4(2), 89.
• Fernández-solís, J. L., & Arch, B. (2009). How the Construction Industry does differ from manufacturing?.
• Fernández-Solís, J. L., Rybkowski, Z. K., Xiao, C., Lü, X., & Chae, L. S. (2015). General contractor's project of projects–a meta-project: understanding the new paradigm and its implications through the lens of entropy. Architectural Engineering and Design Management, 11(3), 213-242.
• Fernández-Solís, J. L. (2009). An Application of Popper's Method of Conjectures and Refutations to the Critique of Emerging Construction Theories. Lean Construction Journal.
• Gleeson, F. and Townend J. (2007). "Lean construction in the corporate world of the U.K. construction industry", University of Manchester, School of Mechanical, Aerospace, Civil and Construction Engineering.
• Howell, Gregory A. (1999). "What is Lean Construction" (pdf). Proceedings IGLC-7. Lean Construction Institute. pp. 1–10. Retrieved 31 March 2013.
• Koskela, L. (1992). "Application of the New Production Philosophy to Construction". Technical Report # 72, Center for Integrated Facility Engineering, Department of Civil Engineering, Stanford University, CA. www.leanconstruction.org/pdf/Koskela-TR72.pdf 10 March 07
• Koskela, Lauri (2000). An Exploration towards a Production Theory and its Application to Construction (pdf) (Ph.D.). Finland: VTT Technical Research Centre of Finland. Retrieved 29 March 2013.
• Koskela, L. and Howell, G., (2002). “The Underlying Theory of Project Management is Obsolete.” Proceedings of the PMI Research Conference, 2002, Pg. 293-302.
• Koskela, L.; Howell, G.; Ballard, G.; Tommelein, I. (2002). "Foundations of Lean Construction". In Best, Rick; de Valence, Gerard (eds.). Design and Construction: Building in Value. Oxford, UK: Butterworth-Heinemann, Elsevier. ISBN 0750651490.
• Kuhn, T. S. (1970). The Structure of Scientific Revolutions. University of Chicago Press.
• Lichtig, W. (2005). "Ten Key Decisions to A Successful Construction Project." American Bar Association, Forum on the Construction Industry, September 29–30, 2005, Toronto, Canada.
• Mastroianni, R. and Abdelhamid, T. S (2003). “The Challenge: The Impetus For Change To Lean Project Delivery”. Proceedings of the 11th Annual Conference for Lean Construction, 22–24 July 2003, Blacksburg, Virginia, 610-621.
• Matthews, Owen; Howell, Gregory A. (April 2005). "Integrated Project Delivery An Example Of Relational Contracting" (pdf). Lean Construction. 2 (1): 46–61. ISSN 1555-1369. Retrieved 29 March 2013.
• Owen Matthews, Gregory A. Howell, and Panagiotis Mitropoulos (2003). Aligning The Lean Organization: A Contractual Approach”. Proceedings of the 11th conference of the international group for lean construction, Blacksburg, Virginia, 22–24 July 2003.
• Porwal, V., Fernández-Solís, J., Lavy, S., & Rybkowski, Z. K. (2010, July). Last planner system implementation challenges. In Proceedings of the 18 Annual Conference International Group for Lean Construction, IGLC (Vol. 18, pp. 548–54).
• Rybkowski, Z. K., Zhou, X., Lavy, S., & Fernández-Solís, J. (2012). Investigation into the nature of productivity gains observed during the Airplane Game lean simulation. Lean Construction Journal.
• Rybkowski, Z. K., Munankami, M., Gottipati, U., Lavy, S., & Fernández-Solis, J. (2011). Impact of cost constraints on aesthetic ranking following Target Value Design exercises.
• Salem, O; Solomon, J; Genaidy, A; Luegring, M (October 2005). "Site Implementation and Assessment of Lean Construction Techniques" (pdf). Lean Construction. 2 (2): 1–21. ISSN 1555-1369. Retrieved 29 March 2013.
• Sowards, Dennis (June 2004). "5S's that would make any CEO Happy". Contractor Magazine. Retrieved 31 March 2013.

• Glossary Lean Construction Institute