Greg Howell talks about lean construction with Mark Graban of Lean Blog

Business Case for Building Information Modeling (BIM), Lean, Green and IPD - What we can learn from an Economist?

Vijay Govindarajan recently caught attention for his recent book "The Other Side of Innovation: Solving the Execution Challenge" published by Harvard Business Review and his work on "Designing $300 Home". He is called the strategic innovation Guru and he is also the Earl C. Daum 1924 Professor of International Business at Dartmouth’s Tuck School in US. He believes that perspiration is more important than innovation i.e. execution of an idea is more important than only coming up with the idea itself.

I will try to explain the advantages of BIM, Lean, Green and IPD by his theory of strategic inovation. He talks about three boxes that large organizations operate into (or where organizations' projects fall into)-

Building Lean and Green using BIM and IPD fall under Box-2 and Box-3 that is selectively forgetting the past practices and creating the future (and here we are talking about 20 years from now i.e. about 2030).

Hear is his talk with Harvard Business Review -

Although, Vijay Govindarajan talks about the strategic innovation in all big companies such as GE, IBM, P&G and considers Google, Amazon and E-bay as the fillers that came into existence because rise of internet and lack of innovation in existing players, the question for us is what AEC industry can learn from his work?

I want to focus this post on more fundamental issue for today's AEC firms - the industry leadership in 2030. I believe that companies listed in BD+C's survey report "Top firms by BIM Project Revenue" and corporate members of Lean Construction Institute (LCI), among other industry innovators excelling in Lean, BIM, IPD and Green & Sustainable construction, have already realized the challenges of industry leadership in 2030. Their business strategies are focused on retaining the existing 'performance engines' and developing the 'innovative execution teams.'

Lets elaborate little more on developing the 'Innovative Execution Teams.' The following illustration serves a good example to explain this concept - adopted from the following talk by Vijay Govindarajan at Dartmouth’s Tuck School -

The following graph shows the four different High Jump Styles (business models) used by Olympic Gold Medal winners in last 100 years.

1) Scissors
2) Western Roll
3) Strabble
4) Fosbury Flop

The most interesting fact is that all new Hight Jump Styles were invented by new athletes and not the existing high performers - meaning athletes expert in "Scissors" did not invent "Western Roll" and so on. One of the reasons for failure was that "Scissors" needs the exercise of different muscles than "Western Roll." For AEC industry, building Lean and Green using BIM and IPD need exercising different muscles (skill sets) than the traditional way of doing things.

If we compare the High Jump Style (business model) innovation explained above with the business models that successful AEC firms are using today, then we come to the conclusion that new innovations will belong to new players in the industry. Interestingly, it is not very strait forward. Companies with a strategy for innovation, that takes into consideration all three boxes shown in the figure-1 above, could still lead in the future.

The solution Vijay Govindarajan presents in his book is "Forget-Borrow-Learn." That is, companies need to forget the rules of the core business, borrow selectively from the existing business model and learn to operate in new entrepreneurial space.

These corner stones of strategic innovation are equally true for AEC firms. Adopting new ideas, business practices and technologies (BIM, Lean, Green and IPD) require a little more attention than the attention given to the core business (the performance engines) but these companies need to develop the 'Innovation Execution Teams' for future competition along with maintaining the present competition.

Leading by example- Ark Hotel Construction shows How Prefabrication can Change the Face of Construction Industry

This video titled "Ark Hotel Construction time lapse building 15 storeys in 2 days" surfaced only last month on the internet and it was seen more than 3.8 million times on Youtube alone.

And there is a reason for that. It took just six days to build the Ark Hotel in Changsha, China. According to the video, no stationary cranes were used in construction and there wasn't single injury among the site's workers.

The 15-story sustainable hotel already had its foundation but using pre-fabricated columns and modules as well as modern construction techniques, construction workers took just 46 hours to finish the main structural components and another 90 hours to finish the building enclosure.

Construction Details:

Level 9 Earthquake Resistance: diagonal bracing structure, light weight, steel construction, passed level 9 earthquake resistance testing

6x Less Material: even though the construction materials are much lighter(250kg/m2) than the traditional materials(over 1500kg/m2), the floors and walls are solid with surefootedness, airtight and sound-proofing

5x Energy Efficient: 150mm thermal insulation for walls and roofs, triple glazed plastic windows, external solar shading, heat insulation, fresh air heat recovery, LED lighting, yearly HAVC A/C energy consumption equivalent to 7 liters oil.

20x Purification: after 3 levels of purification, the purification efficiency for fresh air reaches 95%-99.9%; air exchanged 1-2.5 times per hour, and indoor air is 20x cleaner than out door air

1% Construction Waste: all components are factory made, construction waste, mainly package materials, result from on site set-up only and amount to 1% of the total weight of the building

(source: http://www.youtube.com/user/differentenergy)

If we believe the sources on the internet, this hotel construction caused only 1% material waste as compared to the building industry average of 10% for in-place steel and concrete construction. Clearly, this well planned, coordinated and executed project sets a perfect example for lean construction community and for the construction industry as a whole to understand the value of eliminating waste from the projects.

A Visit to Toyota Texas Plant in San Antonio Texas and Lessons Learned for Construction

On November 19th, 2010, I got a chance to visit Toyota Texas Plant. It was truly a great experience. One because it was a Truck Manufacturing Plant and second because I got to see Toyota Production System (TPS) in action. Toyota is where the concept of 'lean' was first born in 1930's. This visit was very significant for me as I was reading about lean in manufacturing throughout my masters at Texas A&M and this was a time to see how things actually get done at Toyota plants.

We were very well received by the plant management at the Visitors' Center and taken to the assembly lines later after a short presentation on Toyota Texas and TPS. This plant started manufacturing trucks (thats what Texans like the most) called "Tundra" and "Tacoma" in year 2006. Both trucks are manufactured on the same assembly line with the help of automatic changing dies (that typically take 5 min on avg) and about 400 robots. The plant works in 2 shifts and produce around 860 vehicles every day.

I got to see the Toyota truck production first hand and as I mentioned earlier it was amazing. The tour guide was a very kind lady who knew the in and out of the plant and showed us around with every possible detail she could in 45 min duration. However, I couldn't stop my mind by comparing lean in manufacturing and lean in construction throughout those 45 minutes.

One very interesting thought revolving in my mind was "how much revenue Toyota is making every day by selling the trucks manufactured on this plant?" After a few searches on Google, I was able to find out that Tundra costs around $24,000 and Tacoma around $20,000. The simple math tells us that on an average Toyota Texas plant is producing trucks worth $19,000,000 every day (assuming equal number of both models). In contrast a $19,000,000 construction project may take anywhere between 1 to 2 years. Obviously, it could be argued that the upfront plant construction costs, technologies used and number of people working in the Toyota plant are way more than what is done on a construction site. However, we can learn a lot from manufacturing, the difference is too big to compare and the concept of reducing the time and cost with improved quality can be taken to a whole new level once this difference is apparent to everybody on the construction team.

In my opinion every team member from a construction project should visit a manufacturing plant once with an aim in mind to learn from the means and methods used there. It may not be possible for everybody to visit the Toyota Plant but a good manufacturing plant itself will be a great source of learning and motivation.

Dennis Sowards on Lean Construction

Highlights: Lean construction in home building, concepts of "value" in Lean construction thinking, specific examples of "waste" and "value" in construction industry.

New Construction Strategies with Ted Garrison

Dennis Sowards has over 25 years of senior level experience with a record of achievement in Continuous Improvement, Total Quality Management, Industrial Engineering, and Management Consulting. His strengths include proven leadership and technical analysis in problem solving and group facilitation and the ability to function effectively in a rapidly changing technological and organizational environment.

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BIM and Lean - A Wave of Change in the Industry Worldwide

The rise of BIM, Lean and IPD in construction industry during last 2-3 years shows that industry is desperately changing its work practices in these tough economic times. My belief that the tough economy attracted industry's focus towards productivity improvement grew stronger and stronger over last couple of years and especially after seeing the wave of change in the capital asset management practices in public sector. Major government institutions such as General Administration Services (GSA), US Coast Guard, and public works in Wisconsin, Texas, Finland and Denmark made BIM compulsory over the course of last 3-4 years. UK government is also talking about making BIM compulsory for all public projects according to this article - "The use of force: Building information modelling" on building.co.uk

If you are looking for a similar pattern in Lean Construction growth than look at London Heathrow Terminal 5 Project and Sutter Health Projects in California. Both are multi billion dollar construction programs and brilliant examples of Lean Construction applications. BIM already took off three years ago after decades of application in multi billion dollar projects and now next in line are Lean Construction and Integrated Project Delivery (IPD). Instead of changing the softwares and tools (such as BIM) alone it would be a change in the operating system (Lean and IPD Systems) of the industry.

The statement that government regulations and owner demand drive the innovations might sound like a cliché but it is relevant for BIM, Lean and IPD in the present times.

Greg Howell on Lean Construction

New Construction Strategies with Ted Garrison

Greg talks about lean construction principles and its real time applications in the industry. He also talks about the critical role lean construction can play in today's economy.

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