Lean construction


Lean construction is a combination of operational research and practical development in design and construction with an adaption of lean manufacturing principles and practices to the end-to-end design and construction process. Unlike manufacturing, construction is a project-based production process. Lean Construction is concerned with the alignment and holistic pursuit of concurrent and continuous improvements in all dimensions of the built and natural environment: design, construction, activation, maintenance, salvaging, and recycling. This approach tries to manage and improve construction processes with minimum cost and maximum value by considering customer needs, while it helps to achieve and maintain sustainability objectives in all three dimensions of planet, people and profit across the entire construction supply chain.

Historical development

Lauri Koskela, in 1992, challenged the construction management community to consider the inadequacies of the time-cost-quality tradeoff paradigm. Another paradigm-breaking anomaly was that observed by Ballard, Ballard and Howell, and Howell. 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 and continuing through its operation and improvement,".
Evidence from research and observations indicated that the conceptual models of Construction Management and the tools it utilizes fail to deliver projects 'on-time, at budget, and at desired quality'. 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, 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."

A new paradigm

Koskela argued that the mismatch between the conceptual models and observed reality underscored the lack of robustness in the existing constructs and signaled the need for a theory of production in construction. Koskela then used the ideal production system embodied in the Toyota Production System to develop a more overarching production management paradigm for project-based production systems where production is conceptualized in three complementary ways, namely, as a Transformation, as a Flow, and as Value generation.
Koskela and Howell also presented a review of existing management theory – specifically as related to the planning, execution, and control paradigms – in project-based production systems. Both conceptualizations provide a solid intellectual foundation of lean construction as evident from both research and practice.
Recognizing that construction sites reflect prototypical behavior of complex and chaotic systems, especially in the flow of both material and information on and off site, Bertelsen suggested that construction should be modeled using chaos and complex systems theory.
Bertelsen specifically argued that construction could and should be understood in three complementary ways:
The term lean construction was coined by the International Group for Lean Construction in its first meeting in 1993. Greg Howell and Glenn Ballard 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,". Designing a production system to achieve the stated ends is only possible through the collaboration of all project participants 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.
Lean Construction recognizes that desired ends affect the means to achieve these ends, and that available means will affect realized ends. Essentially, Lean Construction aims to embody the benefits of the Master Builder concept.
"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."
Lean construction supplements traditional construction management approaches with : 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 different project and production management 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, A3, process design, offsite fabrication and JIT, value chain mapping, visual site ; 5S, daily crew huddles.
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
While lean construction’s main tool for making design and construction processes more predictable is the Last Planner System 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.

Early involvement of contractors and suppliers

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

Integrated Project Delivery

Primary IPD team members include the owner, architect, key technical consultants, general contractor and key subcontractors.
Using IPD, project participants can overcome key organizational and contractual problems. The IPD approach to contracting aligns project objectives with the interests of key participants. IPD relies on participant selection, transparency and continuing dialog. Construction consumers might consider rethinking their contracting strategies to share more fully in the benefits. The IPD approach creates an organization with the ability to apply Lean Project Delivery principles and practices.

Commercial arrangements that support IPD and Lean Project Delivery

There are at least five principal forms of contract that support lean construction
Other papers explain Integrated Project Delivery and IFoA. PPC2000, IFoA and 'alliancing agreements' were among the topics discussed at the 'Lean in the Public Sector' conference held in 2009.

Integrated Lean Project Delivery (ILPD)

Integrated Lean Project Delivery is a process trademarked by The Boldt Group. It was created and is practiced by The Boldt Group's subsidiary, The Boldt Company. The process aims to eliminate waste across the construction value chain, through evaluation of initial planning and design, and examination of construction processes to predict where and when waste will occur, which is then eliminated through the use of lean tools in the IPD process.
An ILPD contract is a multi-party agreement that specifies the use of lean practices as conceived in the Lean Project Delivery System. This distinction is needed because Integrated Project Delivery is now only referring to the multi-party agreement regardless of what practices are used, the so-called IPD-lite or IPD-ish.

Practical applications of lean construction

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'.

Last Planner System

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 with constraint analysis, weekly work planning based upon reliable promises, and learning based upon analysis of PPC and reasons for variance.

Users such as owners, clients or construction companies, can use LPS to achieve better performance in design and construction through increased schedule/programme predictability.
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
There is a weekly work planning 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 only promise once they have clarified the conditions of satisfaction and are clear that the task can be done.


Figure 4: the promise cycle
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 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 and with support from users around the world. For more information about the development process see Ballard and Ballard and Howell 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 and for additional references see the Designing Buildings wiki.

Differences between LC and project management approaches

There are many differences between the Lean Construction approach and the Project Management Institute approach to construction. These include:
Various networks and institutes conduct research and teach Lean Construction.

Networks, journal and conferences

Various universities teach and conduct research on lean construction:
  1. Dr. Glenn Ballard
  2. Dr. Lauri Koskela