LEAN CONSTRUCTION

Lean Construction
Edited by
LUIS ALARCON
School of Engineering, Catholic University of Chile, Santiago, Chile

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Contents

Preface IX
Acknowledgements XI

Concepts
Lean production in construction 1
Lauri Koskela
What do we mean by lean production in construction? 11
Bert Melles
Lean production theory: Moving beyond 'can do' 17
Greg Howell & Glenn Ballard
Pattern transfer: Process influences on Swedish construction from the
automobile industry 25
J.Brochner
The knowledge process 33
Deborah J.Fisher

Performance measurement
Identifying and monitoring key indicators of project success 43
Ralph D.Ellis Jr
Modeling waste and performance in construction 51
Luis F.Alarcon
Characterization of waste in building construction projects 67
Alfredo Serpell, Adriano Venturi & Jeanette Contreras

Implementation strategies
Lean construction and EPC performance improvement 79
Glenn Ballard
Implementing lean construction: Reducing inflow variation 93
Greg Howell & Glenn Ballard

V
VI Contents

Implementing lean construction: Stabilizing work flow 101

Glenn Ballard & Greg Howell
Implementing lean construction: Improving downstream performance 111
Glenn Ballard & Greg Howell
Identification of critical factors in the owner-contractor relation in
construction projects 127
Luis Fernando Alarcon, Patricio Vene gas & Mario Campero
Fast or concurrent: The art of getting construction improved 143
Pekka Huovila, Lauri Koskela & Mika Lautanala
Factors affecting project success in the piping function 161
Gregory Howell & Glenn Ballard
Construction supply-chains: Case study, integrated cost and
performance analysis 187
William J.O'Brien
Rapid construction as a change driver in construction companies 223
Lauri Koskela, Petri Laurikka & Mika Lautanala
A process approach to design for construction 237
Mika Lautanala

Applications
Continuous improvement in construction management and technologies:
A practical case 249
Hernán de Solminihac T., Roberto Basculian & Luis German Edwards
Lean manufacturing of construction components 263
Lauri Koskela & Jukka Leikas
Lean productivity and the small private practice 273
David Eaton
Lean production productivity improvements for construction professions 279
David Eaton
Toward construction MT 291
Glenn Ballard & Gregory Howell
Building as never before 301
Hc7kan Birke, Jan Eric, Jonsson & Peter Tolf
Schedule compression: A case history 305
Peter N. Woodward
Ultra fast-track project delivery: 21st century partnering and the role
of ADR 311
Robert S.Miles
 Contents VII

Tools
New tools for lean construction 335
Kari Tanskanen, Tutu Wegelius & Hannu Nyman
Lean production as a purpose for computer integrated construction 343
Martin Betts
Application of Quality Function Deployment (QFD) to the determination
of the design characteristics of building apartments 355
Alfredo Serpell & Rodolfo Wagner
Tools for the identification and reduction of waste in construction projects 365
Luis F.Alarcon
Construction models: A new integrated approach 379
Saied Kartam, Glenn Ballard & C. William Ibbs
Training field personnel to identify waste and improvement opportunities
in construction 391
Luis F.Alarcon
Involvement of customer requirements in building design 403
Pekka Huovila, Antti Lakka, Petri Laurikka & Mikko Vainio
Use of the design structure matrix in construction 417
P.Huovila, L.Koskela, M.Lautanala, KPietiltiinen & V.P.Tanhuanptiii
Benchmarking, best practice — and all that 427
Sherif Mohamed

Quality management
Assessing quality control systems: Some methodological considerations 437
David Seymour
Quality assurance and partnering: A lean partnership 457
Ian M.Eilenberg
TQM the Nordic Way: TQMNW 493
Axel Gaarslev
Limitations of the use of tolerances as a means of stating quality
requirements in the reinforced concrete 471
David Seymour, Mazin Shammas-Toma & Leslie Clark
Author index 493
Subject index 495
Preface

In the last two decades, great improvements in performance have been observed in
manufacturing. In particular, lean automobile industry is now using less of
everything: half the manufacturing space, half the human effort in factory, half the
product development time, half the investments in tools. In general, significant
improvements in all performance indicators have been observed simultaneously,
challenging classic paradigms. All these improvements have not been the product of
a radical or sharp change of technology but the result of the application of a new
production philosophy which leads to "Lean Production". The new production
philosophy is a generalisation of such partial approaches as JIT, TQM, time-based
competition, and concurrent engineering. Its adoption is expected to change almost
every industry bringing revolutionary changes to the way we work. So far, in
construction, lean production is little known but several companies have started to
explore applications of the concepts of lean production to construction. Even if only
a small fraction of the gains observed in manufacturing were realised in construction,
the incentive to apply these concepts would be tremendous.
The new production philosophy recognises two types of activities in a production
system: conversions activities which add value to the material or piece of
information being transformed into a product and flows (inspection, waiting,
moving), through which the conversion activities are bound together but which do
not add value. The improvement of non value adding flow activities should primarily
be focused on improving reliability if not reducing or eliminating them, whereas
conversion activities should be made more efficient. In construction, management
attention has been focused on conversion processes and flow activities have not been
controlled or improved, leading to uncertain flow processes, expansion of non value-
adding activities, and reduction of output value. The opportunities of improvement
are enormous. During the last four years an increasing number of researchers have
joined efforts to investigate the implications of lean production to construction.
They have shared their views and experiences with people from the industry,
suggested new approaches to lean construction and worked to advance a new theory
of production in construction.
This book summarises the new and evolving conceptualization of lean
construction by collecting the work developed by members of The International
Group on Lean Construction (IGLC) during the last three years. The authors, who
are from different backgrounds and include people from the industry and the
academia, have covered theoretical aspects as well as relevant areas for lean

IX
X Preface

construction, such as performance measurement, improvement tools, implementation

issues, and case studies. The result is a challenging exchange of ideas and
experiences which include stories of success and also some of failure.

Luis F. Alarcon
Pontificia Universidad Catolica de Chile
Santiago, Chile
November, 1996
Acknowledgements

There is some key people who must be acknowledge for their contribution to the
development of research on Lean Construction. The pioneer work of Lauri Koskela,
from VTT, Finland, was an important milestone in developing a stream of research
on Lean Production applied to Construction. In 1992, Lauri wrote an inspiring report
on Lean Construction during his visit to Stanford University. Then, upon his return
to Finland, he organised the First Conference on Lean Construction which was held
in Espoo, Finland, in 1993. The Second Conference on Lean Construction was
hosted by the Universidad Catolica de Chile, in Santiago, Chile in 1994. Glenn
Ballard, from the University of California, Berkeley, and Gregory Howell from the
University of New Mexico, Albuquerque, have been also key contributors and
enthusiastic promoters of the research on Lean Construction. Greg and Glenn hosted
the Third Conference on Lean Construction which was held in Albuquerque, NM,
USA, in 1995.
The Corporacion de Investigacion de la Construccion of the Chilean Chamber of
Construction is acknowledge for its support to the organization of the Conference on
Lean Construction in Chile and for supporting the research in this area, in the
Construction Engineering and Management Program at the Universidad Catolica de
Chile.

XI
Lean production in construction*

LAURI KOSKELA
V7T Building Technology, Espoo, Finland

ABSTRACT: In manufacturing, great gains in performance have been realized by a

new production philosophy, which leads to 'lean production'. This new production
philosophy is a generalization of such partial approaches as JIT, TQM, time-based
competition, and concurrent engineering. In construction, lean production is little
known. The concepts, principles and methods of lean production are reviewed, and
their applicability in construction is analyzed. The implications of lean production to
construction practice and research are considered.

1 INTRODUCTION

The chronic problems of construction are well-known: low productivity, poor safety,
inferior working conditions, and insufficient quality. A number of solutions or vi-
sions have been offered to relieve these problems in construction. Industrialization
(i.e. prefabrication and modularization) has for a long time been viewed as one di-
rection of progress. Currently, computer integrated construction is seen as an impor-
tant way to reduce fragmentation in construction, which is considered to be a major
cause of existing problems. The vision of robotized and automated construction,
closely associated with computer integrated construction, is another solution pro-
moted by researchers.
Manufacturing has been a reference point and a source of innovations in con-
struction for many decades. For example, the idea of industrialization comes directly
from manufacturing. Computer integration and automation also have their origin in
manufacturing, where their implementation is well ahead compared to construction.
Currently, there is another development trend in manufacturing, the impact of
which appears to be much greater than that of information and automation technol-
ogy. This trend, which is based on a new production philosophy, rather than on new
technology, stresses the importance of basic theories and principles related to pro-
duction processes (Shingo 1988; Schonberger 1990; Plossl 1991). However, because
it has been developed by practitioners in a process of trial and error, the nature of this
approach as a philosophy escaped the attention of both professional and academic
circles until the end of 1980's.
In construction, there has been rather little interest in this new production philoso-

*Presented on the 1st workshop on lean construction, Espoo, 1993

1
2 L. Koskela

phy. The goal of this paper is to assess whether or not the new production philosophy
has implications for construction. The paper is based on a more detailed study
(Koskela 1992a).

2 LEAN PRODUCTION

2.1 Origins of lean production and the new production philosophy

Since the end of 1970's, a confusingly long array of new approaches to production
management has emerged: JIT, TQM, time based competition, value based manage-
ment, process redesign, lean production, world class manufacturing, concurrent en-
gineering.
After closer analysis, it transpires that the above mentioned management ap-
proaches have a common core, but view this from more or less different angles. This
common core is made up by a conceptualization of production or operations in gen-
eral; the angle is determined by the design and control principles emphasized by any
particular approach. For instance JIT stresses the elimination of wait times whereas
TQM aims at the elimination of errors and related rework but both apply this angle to
a flow of work, material or information.
Thus, a new production philosophy is emerging through generalization of these
partial approaches, as has been suggested recently by various authors (Schonberger
1990; Plossl 1991). The new production philosophy, regardless of what term is used
to name it (world class manufacturing, lean production), is the emerging mainstream
approach practised, at least partially, by major manufacturing companies in America,
Europe and Japan. The new philosophy has already had a profound impact in such
industries as car manufacturing and electronics. The application of the approach has
also diffused to fields like customized production, services, administration and prod-
uct development.
The conception of the new production philosophy evolved through three stages: It
was viewed as a tool (like kanban and quality circles), as a manufacturing method
(like JIT) and as a general management philosophy (referred to, for example, as
world class manufacturing or lean production). The conceptual and theoretical as-
pects of the new production philosophy are least understood. However, without con-
ceptual and theoretical understanding the application of methods is bound to remain
inefficient and haphazard.
In Figure 1, an attempt for a consolidation of the new production philosophy is
presented. The various levels are analyzed in the following.

2.2 Conceptual framework

The core of the new production philosophy is in the observation that there are two
aspects in all production systems: Conversions and flows. While all activities expend
cost and consume time, only conversion activities add value to the material or piece
of information being transformed into a product. Thus, the improvement of non value
adding flow activities (inspection, waiting, moving), through which the conversion
activities are bound together, should primarily be focused on reducing or eliminating
 Lean production in construction 3

Concepts

Production
consists of flows
and conversions

Principles for flow design

and improvement: Principles
3 Reduce variability
4 Compress cycle times
5 Simplify

Methodologies
Time based Concurrent
JIT Quality
competition engineering

Figure 1. Different levels of the new production philosophy.

them, whereas conversion activities should be made more efficient. In design, control
and improvement of production systems, both aspects have to be considered. Tradi-
tional managerial principles have considered only conversions, or all activities have
been treated as though they were value-adding conversions.
Due to these traditional managerial principles, flow processes have not been con-
trolled or improved in an orderly fashion. We have been preoccupied with conver-
sion activities. This has led to complex, uncertain and confused flow processes, ex-
pansion of non value-adding activities, and reduction of output value.
Material and information flows are thus the basic unit of analysis in the new pro-
duction philosophy. Flows are characterized by time, cost and value.

2.3 Principles
In various subfields of the new production philosophy, a number of heuristic princi-
ples for flow process design, control and improvement have evolved. There is ample
evidence that through these principles, the efficiency of flow processes in production
activities can be considerably and rapidly improved. The principles may be summa-
rised as follows (Koskela 1992a):
1.Reduce the share of non value-adding activities (also called waste);
2. Increase output value through systematic consideration of customer require-
ments;
3. Reduce variability;
4. Reduce cycle times;
5. Simplify by minimizing the number of steps, parts and linkages;
6. Increase output flexibility;
7. Increase process transparency;
8. Focus control on the complete process;
4 L. Koskela

9. Build continuous improvement into the process;

10. Balance flow improvement with conversion improvement;
11. Benchmark.
In general, the principles apply both to the total flow process and to its subpro-
cesses. In addition, the principles implicitly define flow process problems, such as
complexity, intransparency or segmented control.
Experience shows that these principles are universal: They apply both to purely
physical production and to informational production, like design. Also, they seem to
apply both to mass production and one-of-a-kind production.

2.4 Methodologies and tools

Among the methodologies for attaining lean production are the following most im-
portant:
—Just in time (JIT);
—Total quality management (TQM);
— Time based competition;
— Concurrent engineering;
— Process redesign (or reengineering);
—Value based management;
—Visual management;
—Total productive maintenance (TPM);
—Employee involvement.
Most of these methodologies have originated around one central principle. Even if
they usually acknowledge other principles, their approach is inherently partial.
Thus, for example, the quality approach has variability reduction as its core princi-
ple. Time based management endeavors to reduce cycle times. Value based man-
agement aims at increasing output value.
In the framework of all these methodologies, useful techniques, tools and proce-
dures have been developed. For example, such techniques as quality circles and the 7
quality tools (fishbone diagram, Pareto-diagram etc.) are used in TQM.

2.5 Comparison between conventional production and lean production

What is the conventional production philosophy being now replaced by the new
philosophy? It is the paradigm of industrial mass production, which evolved in the
beginning of this century. The most important differences between the conventional
and the new philosophy are summarized in Table 1.
The results of the implementation of the conventional and the new production
philosophy are schematically illustrated in Figure 2.
Conventional production is improved by implementing new technology, primarily
in value adding activities, to some extent also in non-value adding activities (like
automated storages, transfer lines and computerized control systems). However, with
time, the cost share of non-value adding activities, which are not explicitly con-
trolled, tends to grow: production becomes more complex and prone to disturbances.
In lean production, non value-adding activities are explicitly attended. Through
measurements and the application of the principles for flow control and improve-
 Lean production in construction 5

Table 1. The conventional and the new production philosophy.

Conventional production philosophy New production philosophy
Conceptualization Production consists of conversions Production consists of conversions and
of production (activities); all activities are value- flows; there are value-adding and non-
adding value-adding activities
Focus of control Cost of activities Cost, time and value of flows
Focus of im- Increase of efficiency by implement- Elimination or suppression of non-
provement ing new technology value adding activities, increase of ef-
ficiency of value adding activities
through continuous improvement and
new technology

Conventional production Lean production

Production costs Production costs
100 100
85
Cost of non value-adding activities
70
Cost of non value-adding activitie
50 50
40
30
Costs of value-adding activities Costs of value-adding activities

Time Time

Figure 2. Conventional and lean production: Focus of development efforts.

ment, it is possible to initially reduce the costs of non value-adding activities consid-
erably. Value adding activities are first improved through internal continuous im-
provement and finetuning of existing machinery. Only after these improvement po-
tentials are realized, major investments in new technology are considered. The
implementation of new technology is easier in lean production, because less invest-
ments are needed and the production is better controlled. Thus, after the initial phase,
increase of efficiency of value adding activities should also be more rapid in lean
production than in conventional production.

3 LEAN PRODUCTION IN CONSTRUCTION

3.1 Preliminary implementation

In the construction industry, the overall diffusion of the new philosophy seems to be
rather limited and its applications incomplete. Quality assurance and TQC have been
adopted by a growing number of organizations in construction, first in construction
material and component manufacturing, and later in design and construction. The
6 L. Koskela

new approach, in its JIT-oriented form, has been used by component manufacturers,
for example in window fabrication and prefabricated housing.
Why has the diffusion of the new production philosophy been so slow in con-
struction? The most important barriers to the implementation of these ideas in con-
struction seem to be the following:
—Cases and concepts commonly presented to teach about and diffuse the new ap-
proach have often been specific to certain types of manufacturing, and thus not easy
to internalize and generalize from the point of view of construction;
—Relative lack of international competition in construction;
—Lagging response by academic institutions.
However, it seems that these barriers are of a temporary nature. On the other hand,
the slow diffusion is not explained by an inadequacy of the new philosophy with re-
spect to construction. This is justified by following analyses of waste and peculiari-
ties in construction.

3.2 Waste in construction

To what degree do the problems associated with the conventional production view,
as observed in manufacturing, also exist in construction? If the flow aspects in con-
struction have been historically neglected, it logically follows that current construc-
tion would demonstrate a significant amount of waste (non value-adding activities).
Thus, it is appropriate to check whether the existing information supports this hy-
pothesis.
There has never been any systematic attempt to observe all wastes in a construc-
tion process. However, partial studies from various countries can be used to indicate
the order of magnitude of non value-adding activities in construction. The compila-
tion presented in Table 2 indicates that a considerable amount of waste exists in
construction. However, because conventional measures do not address it, this waste
is invisible in total terms, and is considered to be unactionable.

3.3 Problems of construction are caused by neglect of flows

Analysis (Koskela 1992a) shows that, as in manufacturing, the conceptual basis of
construction engineering and management is conversion or activity oriented. The
construction process is seen as a set of activities, each of which is controlled and im-

Table 2. Waste in construction: Compilation of existing data (Koskela 1992a).

Waste Cost Country
Quality costs (non-conformance) 12% of total project costs USA
External quality cost (during facility use) 4% of total project costs Sweden
Lack of constructability 6-10% of total project cost USA
Poor materials management 10-12% of labor costs USA
Excess consumption of materials on site 10% on average Sweden
Working time used for non-value adding activities on Appr. 2/3 of total time USA
site
Lack of safety 6% of total project costs USA
 Lean production in construction 7

proved as such. Conventional managerial methods, like the sequential method of

project realization or the CPM network method, deteriorate flows by violating the
principles of flow process design and improvement. They concentrate on conversion
activities. The resultant problems in construction tend to compound and self-
perpetuate. In project control, fire-fighting current or looming crises consumes man-
agement resources and attention so totally that there is little room for planning, let
alone improvement activities. As a consequence, there is considerable waste in con-
struction.

3.4 New conceptualization of construction

Following the lead of manufacturing, the next task is to reconceptualize construction
as flows. The starting point for improving construction is to change the way of
thinking, rather than seeking separate solutions to the various problems at hand.
Thus, it is suggested that the information and material flows as well as work flows
of design and construction be identified and measured, first in terms of their internal
waste (non value-adding activities), duration and output value. For improving these
flows, it is a prerequisite that new managerial methods, conducive to flow improve-
ment, are developed and introduced. Such methods have already been developed to
varying degrees. Not unexpectedly, they try to implement those flow design and im-
provement principles which are violated by the respective conventional method.
However, lacking a sound theory, these efforts have remained insufficient.
Generally, taking flows as the unit of analysis in construction leads to profound
changes of concepts and emphasis.

3.5 Construction peculiarities

Construction peculiarities refer especially to following features: one-of-a-kind nature
of projects, site production, and temporary multiorganization. Because of its peculi-
arities, the construction industry is often seen in a class of its own, different from
manufacturing. These peculiarities are often presented as reasons when well-
established and useful procedures from manufacturing are not implemented in con-
struction.
Indeed, these peculiarities may prevent the attainment of flows as efficient as
those in stationary manufacturing. However, the general principles for flow design
and improvement apply for construction flows in spite of these peculiarities: con-
struction flows can be improved. Consider, for example, the one-of-a-kind nature of
construction projects. The same peculiarity is shared by many — if not most — product
development projects in manufacturing. However, it has been possible to shorten the
development time and to improve the output quality in such projects by implement-
ing principles of the philosophy.
On the other hand, these construction peculiarities can be overcome. Initiatives in
several countries, like 'sequential procedure' in France, 'open building system' in the
Netherlands and 'new construction mode' in Finland try to avoid or alleviate related
problems:
— One-of-a-kind features are reduced through standardization, modular coordina-
tion and widened role of contractors and suppliers;
8 L. Koskela

—Difficulties of site production are alleviated through increased prefabrication,

temporal decoupling and through specialized or multi-functional teams;
—The number of temporary linkages between organizations is reduced through
encouragement of longer term strategic alliances.
However, the elimination of construction peculiarities is not any solution itself: It
just brings construction to the same level as manufacturing. Unfortunately, a large
amount of waste also exists in manufacturing before process improvement efforts
begin. Thus, only a starting point for effective process improvement is provided.
Thus it is concluded that the construction peculiarities do not diminish the signifi-
cance of the new philosophy for this industry.

4 IMPLICATIONS

The implications of the new production philosophy for construction will be far-
reaching and broad, as they are in manufacturing. The renewal of manufacturing has
been realized in a feverish burst of conceptual and practical development. This might
also happen in construction.

4.1 Implications for academic research

Current academic research and teaching in construction engineering and management
is founded on an obsolete conceptual and intellectual basis. It is urgent that academic
research and education address the challenges posed by the new philosophy. The first
task is to explain the new philosophy in the context of construction. Formalization of
the scientific foundations of construction management and engineering should be a
long term goal for research.

4.2 Implications for major development efforts in construction

Current development efforts like industrialized construction, computer integrated
construction and construction automation have focused primarily on the efficiency of
value-adding and to some extent also non value-adding activities. They have to be
redefined in order to acknowledge the needs for flow improvement. For example, the
following guidelines for construction automation can be derived from the principles
presented above (Koskela 1992b):
— Automation should be primarily focused on value-adding activities;
—Construction process improvement should precede automation;
—Continuous improvement should be present in all stages of development and
implementation of automation.

4.3 Implications for the industry

Every organization in construction already can initially apply the generic principles,
techniques and tools of the new production philosophy: defect rates can be reduced,
cycle times compressed, and accident rates decreased. Examples of pioneering com-
panies show that substantial, sometimes dramatic improvements are realizable in a
 Lean production in construction 9

few years after the shift to the new philosophy. Given the presently low degree of
penetration, there are ample opportunities for early adopters to gain competitive
benefits.
However, for continued progress, new construction specific managerial methods
and techniques are needed; presumably they will emerge from practical work, as oc-
curred in manufacturing.

ACKNOWLEDGEMENTS

Reprinted from Automation and Robotics in Construction X, 1993, pp 47-54, with

kind permission from Elsevier Science, Amsterdam, Netherlands.

REFERENCES

Koskela, L. 1992a. Application of the New Production Philosophy to Construction. Technical Re-
port No. 72. Center for Integrated Facility Engineering. Department of Civil Engineering. Stan-
ford University. 75 p.
Koskela, L. 1992b. Process Improvement and Automation in Construction: Opposing or Comple-
menting Approaches? The 9th International Symposium on Automation and Robotics in Con-
struction, 3 -5 June 1992, Tokyo. Proceedings. pp. 105-112.
Plossl, G.W. 1991. Managing in the New World of Manufacturing. Prentice-Hall, Englewood
Cliffs. 189 p.
Schonberger, R.J. 1990. Building a chain of customers. The Free Press, New York. 349 p.
Shingo, S. 1988. Non-stock production. Productivity Press, Cambridge, Ma. 454 p.
What do we mean by lean production in
construction?*

BERT MELLES
Delft University of Technology, Delft, Netherlands

1 GENERAL INTRODUCTION

This chapter will discuss lean production in construction. The primary goal of lean
production is to avoid waste of time, money, equipment, etc. (Japanese: Muda)
(Shingo 1992). Everything is focused on productivity improvement and cost reduc-
tion by stimulating all employees.
Koskela (1993) gave an overview of waste in construction. He found results of 6 to
10% of the total project costs in Sweden and the USA.
Investigations in construction companies in the Netherlands (source: INFOCUS
Management Consultants) did give the same results. Quick scans gave a result of fail-
ure costs (costs to restore failures) of at least 6% of the project costs!
Lean production is a philosophy to decline the waste in production companies.
Some elements of this philosophy are used already in construction. We discuss the
principles and experiments.

2 BASIC PRINCIPLES OF LEAN PRODUCTION

In fact lean production does not include really new principles of management tech-
niques. It only combines existing principles in a new day. The primary goal of lean
production is to avoid waste of time, money, equipment, etc. (Japanese: Muda)
(Shingo 1992).
Everything is focused on productivity improvement and cost reduction by simulat-
ing all employees. This implicates that everything is done to bring the pain to them
who created it. In fact a lot of scheduling and decision problems can be avoided by
creating lateral relations between task groups, without managing them in a hierarchical
way. Let everybody manage his own problems and don't create new problems by man-
aging the problems of somebody else! Lean production is invented in Japan. Especially
the implementation of Toyota is very famous. A wide spectrum of techniques ca be
discussed as part of lean production. The most important instruments are:
1.Multifunctional task groups;
2. Simultaneous engineering;
3. Kaizen;

*Presented on the 2nd workshop on lean construction, Santiago, 1994

11
12 B. Melles

4. Just-in-time-deliveries;
5. Co-makership;
6. Customer orientation;
7. Information, communication and process structure.
All these aspects can be discussed separately but in fact they have a lot in common.
The use of all these instruments together are the basis of lean production concepts.
Authors from different fields of management science support the importancy of differ-
ent techniques. In fact there is no pure lean production concept.
Let's discuss the most important instruments of lean production.

Multifunctional task groups

Many authors agreed that the instrument of multifunctional task-groups is one of the
most important instruments of lean production. Instead of homogeneous task groups
a multifunctional task groups produce a number of different products. This makes it
possible to produce a more complex or more completed product with one production
unit. It transfers the maximum number of tasks and responsibilities to those workers
actually adding value. In the mean time an accurate response to market developments
ca be achieved by flexible deployment of personnel (Womack et al. 1990). In multi-
functional task groups workers do not have to wait to each other. It also does not
give stocks. To achieve the principle of multifunctional task groups personnel has to
be trained intensively in recombining thinking and doing (Kenward 1992).

Simultaneous engineering
Today technology changes rapidly. This reduces the lifecycle of products. For this
reason a reduction of product development time is essential. Simultaneous engineer-
ing can achieve this. By using simultaneous engineering the design and manufacture
of the product are no longer separated, physically and time-wise, but integrated and
synchronized, through face to face co-operation between designers and producers in
a product development team. Direct communication and co-operation can reduce the
development period of products significantly (factor 2 to 3). Simultaneous engineer-
ing reduces muda by avoiding miscommunication between engineering and produc-
tion. Within simultaneous engineering also market research is incorporated. This re-
duces the development of products which are not liked by the clients.

Kaizen
Kaizen is Japanese for permanent and stepwise quality improvement. Kaizen stimu-
lates personnel at all levels in a company to use their brains to reduce costs. In fact
Kaizen requires permanent new ideas for cost reduction. In some cases this impli-
cates a strict demand from the management to all production units to create a new
idea each week.
A good implementation of Kaizen implicates cost reduction and zero defects in final
products. It is obvious that Kaizen reduces muda (Imai 1993). Kaizen demands em-
ployee involvement.

Just-in-time deliveries
Just-in-time is a concept for good-flow control. It stimulates reduction of stocks of
material by providing goods when and in the amounts needed (Ohno & Mito 1988).
 What do we mean by lean production in construction? 13

Traditional good-flow oriented control concepts are managing the stock. Instead,
primarily short-term decisions are made based upon the current demand for products.
New subassemblies are made only immediately before they are actually needed. The
ultimate result is that only extremely small subassembly inventories are needed.
Traditional inventory control is based upon detailed scheduling techniques (demand
for parts is `pushed'). With JIT, the actual production of new subassemblies is initi-
ated based upon the demand for products which are really need (the 'pull' approach).
Transparent production control (visual management) is important. Stock of materials
is seen as muda.
The implementation of JIT needs reliable production (zero defects) and good (and
steady) relations with suppliers.

Long term relationships with suppliers (comakership)

The basic idea of comakership is to create co-operation with your suppliers
(Womack et al. 1990). This means e.g.:
—Mutual technology transfer;
—Mutual openness;
—Mutual management support;
—Mutual declining of stock;
— Mutual sharing of profits.
Long term relationship with suppliers stimulates a relation which is founded on co-
operation instead of conflicts. Disturbances in relations causes muda.

Customer orientation
The entire company must be focused on the client (Womack et al. 1990). Client-
supplier-relations are very important internal as well as external. Good communica-
tion with your client declines problems. As a result this declines muda.

Information, communication and process structure

Lean production demands a transparent organization (Koeleman 1991). A transparent
and flat organization implicates better information and communication, internal as
well as external. A simple organization structure makes it easier to communicate. A
transparent organization makes is easier to have an overview of consequences of
control actions. It is obvious that bad communication declines muda.

3 RESULTS OF EXPERIMENTS WITH INSTRUMENTS OF LEAN

PRODUCTION IN CONSTRUCTION IN THE NETHERLANDS

In this section we give an overview of some experiments with instruments of lean

production in The Netherlands (Botermans 1994).

Multifunctional task groups

Five years ago some experiments were carried out to use multiskilled gang of work-
men in housing. Since the sixties all gang were specialized. A large amount of work
was subcontracted. The amount of failures was tremendous, because of the fact that
every gang only looked after his own production. The trends of using multi-skilled
14 B. Melles

gang of workmen were good, but full implementation caused radical changes in or-
ganization. One of the consequences was that homes should not finished via a con-
struction project bases at a construction site and using specialized work crews (such
as kitchen installers, electricians, plumbers) but rather from a central yard using all-
round work crews (Melles & Wamelink 1993). In fact the construction companies
did not have the attitude to realize this innovative ideas although the results of the
experiments were profitable.

Simultaneous engineering and customer orientation

In fact a lot of engineering activities in construction do have some aspects of simul-
taneous engineering. During the last years in several design and construct projects
simultaneous engineering is used. The results were not always profitable. De Ridder
(1994) designed new organization structures for this kind of projects. To implement
these ideas a company needs a good system of management procedures. These sys-
tems are missing very often. The relation between construction company and client is
poor managed (on both sites!).

Kaizen
The first approach to implement Kaizen in construction companies was in the early
eighties. The so-called MANS-philosophy (MANS = new style management) created
a temporary innovative action. The problem was how to communicate the new ideas
in the organization. Another problem was created by the fact that it was difficult to
stimulate the employees to improve permanently. MANS died in silence (Melles &
Wamelink 1993).
The second attempt was implemented in total quality management. This attempt is
still going on but seems to have more success. We will discuss this later.

Just-in-time deliveries and long-term relations with suppliers

Also these experiments (especially in building) were carried out for one project only.
A real long-term relationship with suppliers did not exist. All experiments were more
or less focused on using detailed delivery schedules. In fact this is in contradiction
with the pull-orientation of the JIT-concept.

Information, communication and process structure

During the last years the importance of good and clear information flows is under-
stood. Some research projects were carried out on this subject (Melles & Wamelink
1993). Good communication protocols are impossible if an organization does not
have a system of management procedures.

4 APPLICABILITY OF LEAN PRODUCTION IN CONSTRUCTION

The basic idea of lean production is very simple. Keep your production system and
production organization simple and avoid waste. Stimulate your employees to im-
prove their own production process. If you want to avoid complex information sys-
tems the best way to create good communication within a complex organization is to
create bilateral relations between different task groups (e.g. engineering and produc-
 What do we mean by lean production in construction? 15

tion units) and to give task groups responsibilities (Galbraith 1973). Employees in
such an organization have to change their attitude. The management has to create the
management frame (what production units do we have, what products do we make,
etc.). After that the production units will manage themselves.
In fact the most important goal of lean production is to change the attitude of all
employees of a company. In our view Kaizen is the most important instrument of lean
production. All other instruments are logical implications of the change in attitude. For
example, simultaneous engineering is a logical conclusion of the change in attitude. If
we like to make the total production process transparent, if we like to simplify the
communication structure, if we like to avoid stock of subassemblies we have to think
about the production during engineering activities and reverse about engineering dur-
ing production.
Up until now most experiments with lean production in construction were focused
on implementing one instrument. Most instruments do have overlap with each other
instruments, but in fact they can be implemented as stand-alone instruments. For ex-
ample, it is possible to implement just-in-time deliveries (in a primitive way) on a
construction site, without using simultaneous engineering or multifunctional task
groups.
Only Kaizen really stimulates all other instruments (including instruments like
bench marking which are not mentioned above).
The problem with the Japanese version of Kaizen is that it is developed for the
Japanese culture. The mentality of a country and its people is founded in historical
events. Neither the Japanese society nor the economic structure of Japan is the same as
in Western countries. In Japan the company demands ideas for improvement. Every-
body is proud of and loyal to his company and his part of the production process. In
fact there is a very emotional relation to the company. In Western countries the attitude
to the own company is less emotional.
Kaizen is invented for Japanese companies. This is why Western version of
Kaizen has been developed. In fact it is part of total quality management, based on
certification according the ISO-9000. Total quality management includes quality as-
surance and quality improvement. Within the quality assurance manual the system of
thinking and acting with quality improvement (Kaizen) has been described. The qual-
ity system as well as the implementation can be checked based on the ISO-9000. Such
a total quality management philosophy can be externally checked and certified. In the
Dutch building industry this seems to give good results. Ten years ago another tempta-
tion to implement the basic ideas of Kaizen (MANS-experiment) failed because there
was no external check (Melles & Wamelink 1993).
Total quality management is not concerned with only one aspect of the company. It
is an integral concept for all units. This makes TQM the integrator of instruments in
lean construction. Implementation of TQM based on ISO-9000 is possible in construc-
tion companies in Western countries turns out to create a real change in attitude of
employees. The real change in attitude can be discovered in general one and a half year
after certification (this is 3 to 4 years after the start of the total quality management
program!) (source: INFOCUS Management Consultants).
16 B. Melles

5 CONCLUSIONS AND LESSONS FOR IMPLEMENTATION OF LEAN

PRODUCTION IN CONSTRUCTION

In fact the instruments of lean production are not new. The attitude to make it possi-
ble to use all these instruments together seems to enforce a real change. If we do not
change the attitude of all employees of a construction company we can forget real
implementation of lean production. Beside that we need a system of good manage-
ment procedures to assure good implementation of new ideas. This is the reason why
we think that total quality management, based on ISO-9000 is essential to create an
environment in which other instruments of lean production can be worked out. If we
start with the other instruments they all have a very temporary character.

REFERENCES

Botermans, D.J.M. 1994. Ook de bouwvakker aan de lijn? (in Dutch). Catholic University Brabant.
Galbraith, J.R. 1973. Designing Complex Organizations. Addison-Wesley Publishing Company,
Reading.
Imai, M. 1993. Kaizen, Kaizen.
Kenward, M. 1992. The Fine Art of Mass Production. New Scientist 18 July, New York 1992.
Koeleman, H. 1991. Interne communicatie als managementinstrument. Strategie, middelen, achter-
gronden (in Dutch). Bohn Stafleu Van Loghum, Houten/Zaventem.
Koskela, L. 1993. Lean Production in Construction. Proceedings International Symposium on
Automation an Robotics in Construction, Houston 1993.
Melles, B. & J.W.F. Wamelink 1993. Production Control in Construction, Different Approaches to
Control, Use of Information and Automated Data Processing. Delft University Press.
Ohno, T. & S. Mito 1988. Just-in-time for today and tomorrow. Productivity Press, Cambridge.
Ridder, H.A.J. de 1994. Design and Construct of Complex Civil Engineering Systems, A new Ap-
proach to Organization and Control. Delft University Press.
Shingo, S. 1988 or 1992. Non Stock Production. Productivity Press, Cambridge.
Womack, J.P., D.T. Jones & D. Roos 1990. The Machine That Changed The World. Harper Pere-
nial, New York.
Lean production theory: Moving beyond 'can do'*

GREG HOWELL
Department of Civil Engineering, University of New Mexico, Albuquerque, USA
GLENN BALLARD
Department of Civil Engineering, University of California, Berkeley, USA

1 INTRODUCTION

Lauri Koskela (1992) identified the first task for academics 'is to explain the new
philosophy in the context of construction' and this is first objective here. The second
is to provide a foundation to understand the contributions of Glenn Ballard which
follow. The chapter first discusses changes in the construction industry to suggest
why a new (or for that matter any) production theory is required. The extent of the
uncertainty experienced on projects leads to yet another comparison between manu-
facturing and construction. A new understanding of the construction process is of-
fered. Next the concepts of flows and the role of 'lean production theory' (LPT) is
examined. The chapter closes with a reflection on the mental models which support
current thinking.
One caution, our perspective is drawn from experience in petrochemical and pro-
cess piping projects. While there appear to be many parallels with experience in
other project types, the specific thinking and applications occurred primarily in this
industry segment.

2 UNDERSTANDING THE CONSTRUCTION CONTEXT FOR LPT

Significant gains in manufacturing are reported from implementation of LPT in in-

dustry. Koskela (1992) identifies the overwhelming dominance of conversion think-
ing in construction and argues for replacing the conversion model with a
flow/conversion model in order to reduce waste. Unfortunately, the foundations of
conversion thinking are not clearly explained so its nature must be derived from the
tools, techniques, contracts and organizational forms in use. Perhaps the heavy em-
phasis on the 'critical path method' (CPM) as beginning and ending of planning best
exemplifies the conversion theory in practice. Designed for relatively slow, simple
and certain projects, these tools, techniques, contracts and organizational forms are
inadequate to manage let alone improve practice on quick, complex, and uncertain
projects (Laufer et al. unpubl. paper). A trend toward complex, uncertain and quick
projects is obvious in the petrochemical business and apparent in other segments.
Competition is becoming intense as constructors try to find new ways to reduce

*Presented on the 2nd workshop on lean construction, Santiago, 1994

17
18 G. Howell & G. Ballard

costs even as projects become more difficult. Experiments with various forms of
TQM, partnering, constructability provide some improvements but no consistent
pattern or theory has yet emerged. The development of LPT in manufacturing ap-
pears related to changes in the competitive environment which are similar to those
being experienced in construction. In construction, as in manufacturing, the changed
project environment is the driving force behind the need for new understanding. We
should not forget that the impact of LPT in manufacturing extended well beyond the
shop floor.
There must be many partial explanations for the persistence of conversion think-
ing if it is as inadequate as we suggest. Let us offer a few. It is relatively easy to
contract for the purchase of a thing and relatively difficult to contract for behaviour
(MacNeil 1974). Commercial contract law for the purchase of goods tends to govern
the rules applied to construction. Hence we have a continuing focus on contract
while projects fail because of lack of teamwork — a behaviour issue.
A second reason may be the apparent efficiency of using a single set of tools for a
number of functions. Wouldn't it be wonderful if work could be completely coordi-
nated by a schedule which also provided updated forecasts for senior management,
limited claims, and could be broken into smaller plans to direct specific activities? It
would be wonderful but no such tool exists — despite the claims of CPM software
salesmen. In our experience, it is impossible to show all of the logic constraints with
CPM. Further CPM is inadequate in the face of complex resource constraints as Prof.
Fondahl himself noted in his early work.
A third set of reasons is suggested by what happens when conversion thinking
represented by CPM doesn't work. The typical response in the face of inadequate
performance has been to blame the problem on unmotivated or untrained users. To
even suggest inadequacy is to provoke strong emotional reactions. After they sub-
side, the problem remains that conversion thinking is inadequate in the face of quick
uncertain and complex projects.
Finally, perhaps conversion thinking persists because no adequate alternative has
been proposed and the environment of construction projects really has changed, that
is, the pressure for completion on uncertain projects has increased dramatically in the
last few years.
Current thinking, resting on the needs of a different era, is both unable to deliver
significant breakthroughs, and is itself far more damaging than previously under-
stood.

3 THE SITUATION AND ITS IMPLICATIONS

A review of data on the state of uncertainty at the beginning of the construction

phase is instructive. Data in Figure 1 shows the state of uncertainty at the beginning
of typical construction projects as reported by about 175 project managers represent-
ing a broad spectrum of project sizes and types. The data confirms that significant
uncertainty is to be expected even as late as the start of construction (Howell &
Laufer 1993).
Data in Figure 2 was collected from managers of similar projects. Here the man-
agers reported on their most recent projects as opposed to their 'typical' projects as
 Lean production theory: Moving beyond 'can do' 19

11% 25% 14%

Certain Certain Means
Objectives Certain Objectives
Uncertain Means 01

xx mcx x X 22%
X xx
X A
s At X
x xx xii x gage
ix. X
xx
a 5 K
x x
X X 11%
x
x
x 4%
x
10 ,
Uncertain Objectives Uncertain Objectives
Uncertain Means How Uncertainty Certain Means

Figure 1. Assessment of uncertainty at the start of construction: Typical projects.

Uncertain Objectives Certain Objectives -

Uncertain Means Certain Means -

a
I .1
I
4I

4tjAiLIIIIIII,.'
Smejnaufi jeqm

A 7 0111Pr
1.
Heads of Arrows
show Later
Ar
/ 1 determination
•
r
Tails of Arrows show
determination at the start
I of construction

VI "•" Denotes
Correct
I Assessment

I I

I I

i I

Certain Objectives Uncertain Objectives -

- Uncertain Means How Uncertainty Certain Means

Figure 2. Assessment of uncertainty at the start of construction: Most recent project.

20 G. Howell & G. Ballard

in Figure 1. The managers were asked to use a 'T' to locate where they thought the
project was when construction began and an 'R' where it really was once they un-
derstood the situation.
This pattern is even more disturbing and compelling. In 85% of the projects, the
manager underestimated the extent of uncertainty. The problems they didn't know
about were bigger than the problems they knew about.
Consider the waste of proceeding with detailed planning and mobilization on such
an unstable basis. If project management accepts real responsibility for project suc-
cess, the misperception must be rooted in the way planning is conducted. The degree
of instability suggests an overwhelming tendency to optimistic evaluations of project
circumstance. These evaluations drive managers to plan in greater detail than sup-
ported by their information. This persistent optimism suggests either a genetic pre-
disposition on the part of construction planners or a defect in current design of plan-
ning systems. Whatever the cause, managers are tending to focus on planning to a
fine level of detail far too soon. Focus on technique without an accurate diagnosis of
the situation doesn't make much sense. Information must be collected and verified.
In addition to the data on uncertainty, the pressure to reduce project durations is
clear. The CII is conducting research in the area and the need for faster completion is
widely reported. Recent interviews with superintendents leave little doubt about the
increased urgency and complexity of projects in their charge.
LPT in construction must come to grips with the entire design and construction
process because increasingly complex projects are being urgently pressed forward
under greater uncertainty. Field operations can be improved using LPT principles but
even they occur in a different context from manufacturing production. A comparison
with manufacturing shows the key feature which distinguishes construction from
manufacturing is the extent of uncertainty evident throughout the phase (Table 1).

Table 1. Context of manufacturing and construction production.

Start of manufacturing production Start of construction in the field
What Highly defined Evolving as means refines ends
How Highly defined. Operations plan is Partly defined but details un-examined. Ex-
in great detail based many trials. tensive planning remains as situation
Primary sequence of major tasks is evolves. Primary sequence only partly deter-
inflexible, interdependencies are mined by hard logic but may change. Inter-
documented and analyzed. Posi- dependencies due to conflicting measure-
tions in process determine required ments, shared resources, and intermediate
skills products only partly understood. General
craft skills to be applied in a variety of posi-
tions
Assembly Produce one of a finite set of ob- Make the only one. The details of what and
objectives jects where the details of what and how are not completely known at the begin-
how are known at the beginning of ning of assembly
assembly
Improvement Rapid learning during the first Rapid learning during both planning and
strategy units preparing for production runs early sub-assembly cycles
 Lean production theory: Moving beyond 'can do' 21

In important ways, the life of a construction project is similar to the product de-
velopment stage in manufacturing. Because a construction project is analogous to the
preparation of a prototype, completing the construction phase is better understood as
one of the preliminary steps leading to the 'production' which occurs once the facil-
ity is completed rather than as manufacturing production exposed to the elements.
Reducing uncertainty related to 'what and how' defines the process of 'building a
prototype in place'. The challenge for LPT is to reduce waste through bringing sta-
bility to the planning process as 'what and how' are refined.
Stability is a key aspect of LPT in manufacturing. There the idea is to minimize
input variations so non-value adding steps or flow related activities could be elimi-
nated from the process. Managing flows in construction is more difficult than in the
production phase of manufacturing because there is uncertainty both in what is to be
accomplished and in the provision of requirements for assembly.
Current construction thinking tends to deny the existence of uncertainty or to sug-
gest it is some sort of moral failure.
— 'If the owner would make up their mind — once and for all, we could do our
job.'; or
— 'If the process design engineers would...' and on down the chain.
Once the reality of uncertainty is accepted, a construction project becomes less the
transmission of unambiguous orders from the owner to the worker and more a series
of negotiations. The object of these negotiations is the rapid reduction of uncertainty.
Anything which inhibits these negotiations adds waste. This is true whether the ne-
gotiation is between project objectives and means during project definition and de-
sign or the more constrained negotiation between shoulds and cans which occurs as
foremen prepare weekly work plans.
It is time to examine the concept of flows in relation to the reduction of uncer-
tainty.

4 FLOWS RECONSIDERED

The idea of flows of materials and information from one conversion process to an-
other is quick to grasp. Work in a factory or on a site can be thought of in terms of
the movement of materials and information (stuff) through 'input — process — out-
put/input — process — output' chains. Stabilizing work in these chains reduces waste.
It requires managing the timing and sequence of the flow of stuff, and assuring it
meets downstream requirements.
This simple I/O model is adequate for field assembly operations but is not suffi-
cient for understanding the flows involved in the planning process. Minimizing un-
certainty in the flow of decisions and information required in planning is as impor-
tant as minimizing uncertainty in the flow of stuff. To visualize the flows associated
with planning, we propose to expand the horizontal I/O model to include the con-
cepts of directives, i.e. the vertical flow of instructions or standards, the plans for the
process at hand. Similar ideas have been expressed by IDEF0 and SanVido but have
been thoroughly developed by Talley & Ballard (1990).
In a sense, plans are directives produced by a planning process. They tell the next
level what 'should' take place. Inputs such as materials to the work processes de-
22 G. Howell & G. Ballard

termine what 'can' be done. Thus there are two different kinds of flows — one of the
plans which become more narrow as the assembly process nears, and stuff which is
used in the assembly process. Uncertainty may be transmitted to the work site
through either flow. Stabilizing work flow, the subject of Chapter 11 (pp. 101-110),
proposes a technique for shielding the workers from uncertainty in both plans and
stuff. This is the first step in waste reduction and it provides a basis for further im-
provements.
Reducing the waste occasioned by the flow of stuff is closely tied to the develop-
ment of plans. Stable plans both rest on firm upstream assumptions (or premises) and
have been tested against the availability of resources. Reducing the variation in the
flow of both plans and stuff is the topic of Chapter 10 (pp. 93-100).
LPT, as we understand it, reduces waste by rapidly reducing uncertainty. The im-
plementation strategy is to stabilize work flow by shielding, reduce in-flow variation,
then better match labor to available work, and finally improve downstream perform-
ance. This strategy both solves problems on projects and clarifies our understanding
of LPT. Once this approach is adopted it becomes clear that current management
techniques inject uncertainty into the project. Examples will be offered as time per-
mits.
The immediate goal of LPT should be to bring stability to the process by more ef-
ficient 'negotiations' between ends and means at every level. Activities such as part-
nering and constructability which are considered partial implementations of LPT ex-
emplify the negotiation aspect of construction. Important work remains in learning to
package and planning to the right level of detail so plans remain in force and stable
despite environmental changes. Conversion thinking offers little advice on how to
package work so that activities may proceed independently.

5 MOVING BEYOND 'CAN DO'

`Can do' the slogan of the SeaBees of the US Navy summarizes the underlying
mental model of most constructors. Ambiguous as it may be, 'can do' is an answer to
an assignment. It means, 'no matter what the problem or situation, you can count on
me to get the job done.' (no wonder they chose 'can do'.)
A new answer, 'won't do' is possible under LPT because it makes explicit the
criteria for decision making. As we develop our understanding of LPT in construc-
tion we will confront the underlying thinking of an industry built on 'can do'. Real
information on the performance of planning and resource systems can only be avail-
able when those charged with planning and doing the work can say 'won't do.'
Having the right to say 'no' makes real commitment possible. I am not saying people
are allowed to say no on a whim, rather that they are required to say no when asked
to act beyond the limits of established criteria. This sounds a lot like Ohno' s radical
decision to allow workers to stop the production lines.
Current management planning and controls systems rely on two unspoken as-
sumptions:
1.The last planner (who you will meet shortly) will always select work in the
`correct' order to achieve project objectives; and
2. Last planners lack the intelligence to manipulate the cost/schedule system for
their own short term ends.
 Lean production theory: Moving beyond 'can do' 23

In effect we believe they do not know how to protect themselves by selecting the
easy work when pressed to increase productivity or production or loose their job.
In short, current management approaches are built on and entice dishonesty. We
cannot improve performance unless new thinking exposes the contradictions and
weaknesses in our underlying mental models and injects certainty and honesty into
the management of projects. It is simple in concept and not hard in execution once
we take the challenge of no longer accepting 'can do' when 'won't do' is appropri-
ate. Only then will we have the consistent feedback needed for rapid learning (Senge
1994).

6 WHERE DO WE GO FROM HERE?

Simple, certain and slow jobs hardly pose a challenge. Those best able to manage
complex uncertain and quick projects will claim the future. Tools developed to en-
hance performance on these projects will prove useful on all projects but the aim of
LPT should be to help those managing in turbulent situations. Since construction
projects are really vast product development processes seldom repeated by the same
group of people, and there are so many of these projects, LPT drawn from construc-
tion should prove useful across the spectrum of product development efforts.
The idea that LPT ideas drawn from construction could be valuable in other are-
nas is at first surprising — we tend to think of ourselves as primitive compared to
manufacturing. Perhaps our field operations are primitive in comparison with the
auto factory of today. This chapter has argued that this is an incorrect comparison.
The better comparison is with the product development phase. Here we may not look
so bad. It is worth noting that Gilbreth and Ohno, two seminal thinkers in industrial
or manufacturing engineering began their careers working in construction.
One caution, we must avoid the tendency (particularly among academics) to deny
the nasty uncertainty of the real world. We must avoid the temptation to becoming
manufacturing engineers who attempt to change circumstance to fit a theory which is
useful in a more stable arena. Rather we must develop our own unique approach to
managing all of the flows occasioned by the complex negotiation between ends and
means. Once we bring stability to the work environment through better planning, we
can turn to the details of methods analysis and there utilize similar principles to those
applied at the project level.

REFERENCES

Koskela, L. 1992. Application of new production theory in construction. Technical Report No. 72
CIFE, Stanford University.
Howell, G.A. & A.L. Laufer 1993. Uncertainty and project objectives. Project Appraisal.
Laufer, A.L., Denker, G. & V. Shenhar (unpubl. paper). Simultaneous management.
MacNeil, I.R. 1974. The many futures of contract. University of Southern California.
San Vido, V. Various papers in ASCE journals.
Senge, P. 1994. The Fifth Discipline Fieldbook.
Talley, J. & H.G. Ballard 1990. Work Mapping Package.
Pattern transfer: Process influences on Swedish
construction from the automobile industry*

J. BROCHNER
Royal Institute of Technology, Stockholm, Sweden

ABSTRACT: Sweden differs from other Nordic countries in having a large share of
manufacturing accounted for by automobile production. In this paper, it is shown that
since the 1910s, the process of manufacturing and in particular manufacturing cars
has served as a paradigm for process change in Swedish residential and commercial
construction. Government policies on construction and joint action by the construc-
tion industry have been influenced explicitly by features of the car design, manufac-
turing and marketing processes. Direct transfer and influence has occurred in con-
tractual relations between owners in the automobile industry and contractors. Over
the years, supplier relations or customer relations in the industry have formed pat-
terns for changes in the construction process: Standardization of components for
mass production, functional design logic, limited customization, mass marketing and
recently EDI links to suppliers.

1 INTRODUCTION

For many years, car makers have been invoked as models for the reengineering of a
conservative building industry, perceived to remain stubbornly at a pre-industrial
stage and bogged down by obsolete practices inherited from medieval craftsmen.
Cars and residences have in common they are about the most costly and durable
goods that an average household may consider buying. Both have to fit the human
scale, and thus neither can follow very far the path of microminiaturization that has
led to such startling increases in productivity and decreases in prices associated with
electronics.
But do practices diffuse from car manufacturers to construction contractors? What
features migrate, if any, and which are the mechanisms in these cases? The issues to
be dealt with here in the Swedish context are mainly two:
1.How is the car industry influence transmitted to the construction industry?
2. Which are the lessons perceived to be learnt from the car industry?
Answers to both these questions have changed over the years.

*Presented on the 3rd workshop on lean construction, Albuquerque, 1995

25
26 J. Brochner

2 WAYS OF TRANSMISSION

Fundamentally, a number of mechanisms for technology diffusion from car manufac-

turing to residential and commercial construction can be envisaged:
— A car producer as owner commissions buildings to be produced with construc-
tion process changes inspired by its primary production process for vehicles;
— Construction companies search actively for automotive paradigms;
— Government research funds are channelled into industrialization of construction,
using car production as a pattern;
—Construction companies recruit white- and blue-collar employees, intentionally
or unintentionally, with production experience from the car industry;
—Joint ownership of car related business with construction related business;
—Owners outside the industry point to the automotive paradigm and exert pres-
sure on construction companies to apply practices according to the paradigm.
Sweden differs from other Nordic countries in having car producers within its
borders. This raises expectations of direct influences on the Swedish construction
sector. Nevertheless, it should be said that although much smaller in terms of popu-
lation than most other car producing countries, the level of per capita car production
is comparable to that of much larger producing countries. Table 1 shows how per
capita car production varies over a number of countries. Swedish and US figures for
1990 almost coincide.

3 PARADIGMATIC ASPECTS OF CAR PRODUCTION

3.1 The Ford model T Era: Standardized mass production

When Gunnar Asplund and his co-authors, being all the major proponents of archi-
tectural modernism in Sweden, published their highly influential `acceptera'
(accept!) in 1931, they pitted the teachings of the (internationally not very widely
known) Swedish sociologist Gustaf Steffen against Henry Ford, with Steffen in the
role of the observer and with Ford seen as the doer (Asplund et al. 1931).
However, Steffen must be credited with pioneer status, given his analysis more
than a decade earlier of how the production methods of industrialism had failed to
transform European residential construction, and in particular so in Sweden (Steffen
1918). In his analysis, which he wrote as a member and initiator of the first Swedish
Royal Commission on Housing, Steffen noted that only in America would you find
factory mass production of components to be assembled — or replaced — for home

Table 1. Car production (per capita) in 1990.

Country Cars produced per capita
Sweden 0.025
Japan 0.080
USA 0.024
France 0.058
Source: UN Statistics.
 Pattern transfer: Process influence on Swedish construction 27

construction. With hidden reminiscences of his earlier interest in Ruskin's teachings,

he did voice some doubts as to the aesthetic consequences; nevertheless, his plea for
prefabrication is clear. His paradigms are not presented in detail and tend to belong
to 19th century industrialism: Railroads and steamboats, although there is a sweeping
gesture towards 'the whole range of later technical improvements'. Steffen was born
in 1864, the year after Henry Ford, and had published his first analysis of industrial-
ism and the Worker Question already in the 1880s.
The 'acceptera' chapter on Industrial Housing Production — Standardization be-
gins with a reflection on the fact that any worker can afford a bicycle. This the
authors ascribe to machine work and industrial organization, and they continue to
stress that this is the case for most of our commodities, from pins to cars. They refer
to the principle of reproduction, implying mass or series production, and find that
this necessitates a reduction to a limited number of fixed types, or in other words
standardization. Photographs serve to illustrate their concept of types: A Gothic
church, a bookshelf, a Doric temple and a 1930s car are reproduced in 'acceptera'.
The impact of standardization on construction activities is expressed by Asplund
et al. (1931) as implying a minimization of site work through prefabrication. Variety
in construction will be based on a limited number of basic components or types in
the market. Photographs from Frankfurt construction are used to illustrate this. When
discussing large-scale production, the authors indicate the possibility of using more
efficient site equipment for assembly and transports. Not all features are inspired by
car manufacturers, it must be allowed: Building components can be manufactured on
site using available local materials, they suggest. Teams with interior specialization
could be moved from house to house as in the Frankfurt experiment. Identical work-
ers or teams repeat the same work process for each house, which is supposed to lead
to an increased work rate and increased precision in the work performed. As to per-
sonalization, 'acceptera' takes a dark view of car vendors: 'Or who believes, al-
though the opposite is claimed by smart advertisements, that he for instance can buy
a personalized car or a personalized textile for a suit... ?'
At that time, when referring to car production, the immediate Swedish paradigms
were probably far less important to the authors than the images transmitted by means
of leading foreign modernists, in particular ideologues such as Walter Gropius and le
Corbusier. These emphasize a complex of production efficiency and product quality.
First, they asserted that they had solved the problem of how to construct residential
buildings using a dry method (`la maison a sec', le Corbusier 1930) and also that
they had acted as the manufacturers of automobiles and railroad rolling stock. Sec-
ondly, in 1928, Gropius found a graphical presentation showing price increases in
North America since 1913, namely 50% for Ford, 78% for the car industry and 200%
for houses, where as the general cost of living had risen to 150% (le Corbusier 1930).
This divergent pattern was explained by the perfection of methods of mass produc-
tion among car manufacturers.
It is not only influences transmitted by thinkers on the European continent which
can be traced in 'acceptera', but also models from US sociologists. Since the authors
refer to the original Middletown study elsewhere in their book, it is probable that
they had been influenced by the heavy criticism levied against the local construction
industry in Middletown/Muncie: 'Standardized large-scale production, the new habit
in industry that makes Middletown's large automobile parts shops possible, is com-
28 J. Brochner

ing very slowly in the complex of tool-using activities concerned with making house;
the building of homes is still largely in the single-unit handicraft stage'. (Lynd &
Lynd 1929). Something similar applied to Swedish residential construction at that
time.
One of the more influential architects behind `acceptera', Uno Ahren, had direct
experience from working with the automobile industry just before the book went to
press. His responsibility had been the Ford Motor Company assembly and repair
factory in the Free Port of Stockholm, built in 1930/1931 and considered a break-
through project in Sweden. Brunnberg (1990) in her study of the industry architec-
ture of modernism in Sweden points out the influence of Ford's chief architect
through many years, Albert Kahn, and his floor layouts and innovative use of new
materials in the service of car production.

3.2 The BMC 1000 Era: Product development

The principles of mass production as advocated in the 1930s would not be applied
extensively to residential production in Sweden until the 1960s, when the annual
volume went up rapidly. Although high-rise apartment buildings construction with
large prefabricates stood for a smaller proportion after the early 1960s, in 1965, the
decennial million programme was declared by the government, based on support for
mass production. The objective of one million new homes was met, but criticism of
stereotyped environments produced grew more vocal. Could monotony be broken,
and would the car manufacturers provide another paradigm?
The Swedish Industries' Building Study Group (1969) used an innovations study
published by the Royal Swedish Academy of Engineering Sciences two years earlier
where 'the British car BMC 1000 is used to exemplify active, product-yielding re-
search and development work'. The example shows how systematic development
work based on well-known techniques results in better products being offered to the
consumers. Also underlined was how R&D leads to results when transformed
through product development into successful products, and 'the decisive part played
by companies as regards development and progress'. One consequence was emphasis
on functional design logic and pressure on the formulation of building codes so that
performance requirements would be used more frequently, leaving room for product
innovation in the construction industry.

3.3 Quality assurance: Volvo as customer

The type of industrial thinking represented by the million programme was seldom
focused on details of product quality or on responsiveness to owner and user needs.
Rising maintenance costs and owner dissatisfaction were often discussed but with no
obvious solution. The Volvo Group Headquarters outside Gothenburg (Petersson
1984) was however a fresh initiative. Here, the largest car manufacturer in Sweden
required that the contractor should present a system for quality assurance. Although
there were precedents in the construction of nuclear energy plants during the 1960s,
no contractor had any other experience of quality assurance systems. Interesting is
that the owner (Volvo) was unwilling to impose on contractors its then current qual-
ity systems for suppliers of car parts. Instead, when pressed by contractors, Volvo re-
 Pattern transfer: Process influence on Swedish construction 29

trained, and as a consequence, the successful contractor, F.O. Peterson, had recourse
to the at that time unique Canadian standard for quality assurance and had to adapt
this standard independently to construction purposes (Augustsson 1995).

3.4 Electronic data interchange: SAAB and suppliers

Interest in and the introduction of Electronic Data Interchange (EDI) in the Swedish
construction sector have clearly been influenced by the relations between suppliers
and producers in the car industry. The fact that SAAB requires suppliers to commu-
nicate through the medium of ODETTE has been important.

4 FROM MASS TO LEAN PRODUCTION: CURRENT VIEWS

4.1 Remnants of the mass production paradigm

The traditional interest in the mass production paradigm is still alive. Johansson &
Snickars (1992) mention development phases and periods of change in the automo-
bile industry, starting with the analysis performed by Altshuler and others published
in the MIT 1984 report on the Future of the Automobile. Johansson & Snickars
(1992) claim that the Swedish construction industry had developed up to 1950 to the
point where automobile production found itself before the Ford model T Era, i.e. be-
fore 1910-1920. It is especially economies of scale and the advent of mass produc-
tion in housing during the 1960s that Johansson & Snickars (1992) discuss.
Supply chain coordination is an issue which includes both the old concern with
prefabrication and other aspects. In the 1994 PEAB Annual Report, the CEO of one
of the largest contractors in Sweden says 'Volvo or SAAB would hardly buy e.g.
pipes in ten metre lengths to be cut and bent so that they fit the car. But that is the
way we work on a construction site'. Such observations remain commonplace and
are basically along the lines of the reasoning first formulated earlier in the century.

4.2 Focus on time

It is only with the 1990s that the focus on time as a metric for production arrives in
the construction sector, first as part of the Skanska 3T program (Ekstedt & Wirdenius
1994; BrOchner 1994). Here, the lag between acceptance of time focus in the manu-
facturing industry and in construction is minimal The theme is often repeated during
the first half of the 1990s: Redtzer (1994) refers to the automotive industry and its
manufacturing of components and systems to cut construction times by half, which
would give at least 20% lower construction costs.

4.3 Personalized products

More surprising is the claim that the present car industry provides greater scope for
personalization of products than does construction. A recent trade magazine article
(Redlund 1995) on future residential construction starts by noting that the car indus-
try delivers its products with specialized details and equipment, according to the
30 J. Brochner

wishes of the individual customer, and then ventures to ask whether future homes
can be preordered in a similar way and adapted to the needs of the resident. This is
very far from `acceptera' in 1931, when car producers were seen as paradigmatically
uninterested in individual whims.

4.4 Learning from lean production: Arcona AB

The construction management activities of Arcona AB are of special interest because
they were until recently carried on in parallel with another company in the group
being agent for German and Japanese cars in Sweden. However, with the possible
exception of the Nissan transplant factory in Sunderland, UK, top Arcona managers
are reluctant to identify direct influences from the car industry on their methods for
construction management (Birke & Jonsson 1995). As external sources of ideas in
addition to the car industry, Arcona does acknowledge the ABB Group and its T50
program for reducing cycle times by half. Effects of the T50 program are spread by
ABB subsidiaries in their role as suppliers to firms such as Arcona. T50 is important
for its customer orientation and its hunt for time. Another source of inspiration is
producers of luxury yachts, where just-in-time procedures are based on traditional
craftsmanship, well organized traditional craft work being appreciated as a form of
lean production. However, the main source of inspiration is claimed to be the day-to-
day activities and experiences in construction projects.
For Arcona, focus on time has been the main principle, discovered as the key to
rational production. Process orientation has been seen as essential, implying that
non-value-adding activities should be squeezed out. There should be raised precision
in all that is done, so as to minimize surprises. This means using the best competence
available and dependable partners as strategic suppliers, who should participate from
the outset. In this manner, the basis for continuous change is laid, including technol-
ogy change. Everything should be subordinated to relations so as to escape from the
traditional division into opposite parties being kept apart by strict boundaries. In
short, all firms involved should profit from being less costly in the process. Ideally,
there should be incentive agreements tied to all interfirm relations. According to the
`less of everything' principle, small organizations in a small concentrated core group
which (pace IT) should sit together in the literal physical sense is desirable; also that
this organization is retained from project to project, again with as few people as pos-
sible being involved. 'If people always do right, fewer people will be needed'.

5 CONCLUSIONS

In spite of the frequency with which car manufacturing has been invoked as a para-
digm for construction, there have only been a few clear-cut cases of direct transfer of
ideas and work practices from the car side, and then only when a car manufacturer
such as Ford or Volvo has acted as customer to the construction industry. Perhaps the
more efficient ways to influence construction has been through the medium of gen
eral interest in foreign cultures of manufacturing, historically appearing on the scene
in the order of US and Japanese influences on the Swedish industrial imagination. To
take only the two most prominent, focus on time and on stronger relations with key
 Pattern transfer: Process influence on Swedish construction 31

suppliers are transforming all branches of industry and consequently also how large
contractors choose to operate. The time lag between the rest of industry and con-
struction is not long nowadays; the slowness to conform has probably to be ex-
plained by peculiarities in the IT support for most types of construction activities.

REFERENCES

Asplund, G., Gahn, W., Markelius, S., Paulsson, G., Sundahl, E. & Ahren, U. 1931. Acceptera
(Accept, in Swedish). Stockholm: Tiden.
Augustsson, R. 1995. Personal communication.
Birke, H. & Jonsson, J.E. 1995. Personal communication.
BrunnstrOm, L. 1990. Den rationella fabriken (The rational factory, in Swedish). Um& Dokuma.
Br6chner, J. 1994. Organizational adaptations to strategic developments in construction companies.
Proceedings of the A.J. Etkin International Seminar on Strategic Planning in Construction
Companies, Haifa, 8-9 juni 1994, pp. 35-49. Haifa: National Building Institute, Technion.
Corbusier le, E.J. 1930. Analyse des elements fondamentaux du probleme de la `maison minimum'
(Analysis of fundamentals of the Minimal Home Problem, in French). In: Die Wohnung fiir das
Existenzminimum, pp. 20-29. Frankfurt: Englert & Schlosser.
Ekstedt, E. & Wirdenius, H. 1994. Enterprise renewal efforts and receiver competence: The ABB
T50 and the Skanska 3T cases compared. Paper presented at the IRNOP Conference, Lycksele,
Sweden, March 22-25.
Gropius, W. 1924. Wohnhaus-Industrie: Ein Versuchshaus des Bauhauses (Residential industry:
An experimental Bauhaus house, in German). Bauhausbiicher, Vol. 3. Munich: Albert Langen.
(Tr. in Scope of Total Architecture. New York: Harper & Brothers 1955).
Johansson, B. & Snickars, F. 1992. Infrastruktur: byggsektom i kunskapssamhiillet (Infrastructure:
the construction sector in the Knowledge Society, in Swedish). The Swedish Council for
Building Research, T33:1992. Stockholm.
Lynd, R.S. & Lynd, H.M. 1929. Middletown: A Study in Contemporary American Culture. New
York: Harcourt, Brace & Co.
PEAB Arsredovisning 1994. (Annual Report) (p. 6).
Petersson, C.-G. 1984. Volvo HK ett pilotprojekt f6r kvalitetssakring (Volvo HQ, a pilot project
for quality assurance, in Swedish). Byggmastaren, No. 5, pp. 37-38.
Redlund, M. 1995. Framtidens bostader kraver trendnissar (Future homes need trendies, in Swed-
ish). Byggindustrin, No. 19, pp. 26-28.
Redtzer, U. 1994. Vi bygger dyrt med forlegade metoder (We build expensively with obsolete
methods, in Swedish). Dagens industri, February 1.
Steffen, G. 1918. Bostadsfragan i Sverige (The Housing Question in Sweden, in Swedish).
Bostadskommissionens utredningar, Vol. IX. Stockholm.
The Swedish Industries' Building Study Group 1969. The New Building Market: Product Respon-
sibility, Competition, Continuity. Stockholm: Byggforlaget.
The knowledge process*

DEBORAH J. FISHER
University of Mexico, Albuquerque, USA

ABSTRACT: This chapter describes the knowledge process and how it is a part of
lean construction principles. The knowledge process is then further viewed within
the context of two current research projects being conducted by the department of
civil engineering at the University of New Mexico. One research project, funded by
the National Cooperative Highway Research Program (NCHRP), is entitled 'Con-
structibility review process for transportation facilities,' whose purpose is to develop
a formalized constructibility review process for state highway agencies. The other re-
search program, sponsored by the Construction Industry Institute (CII), is entitled
`Modeling the lessons learned process,' and has as its purpose to develop a formal-
ized lessons learned process for CII member companies to follow, in order to imple-
ment knowledge. Both of these research projects are viewed in the broader context of
knowledge management and current organizational learning theory as it applies to
lean construction.

1 INTRODUCTION

Before I begin this chapter, I must first defend my basic premise that the knowledge
process is part of lean construction. Knowing that the definition of lean construction
is still being argued, this becomes no less a challenge. If you use Womack's defini-
tion of lean production as a starting point for the definition of lean construction, then
the principles would be (Womack 1990):
— Teamwork;
— Communication;
— Efficient use of resources;
— Elimination of waste;
— Continuous improvement.
Certainly the learning organization demonstrates these abilities, regardless of
whether you are in a production organization (i.e. manufacturing) or a project organi-
zation (i.e. construction). Senge refers further to learning organizations and the 'dis-
ciplines of theory, methods, and tools representing bodies of actionable knowledge
(Senge 1994)'. Both of these authors substantiate the importance of knowledge and
learning as an important aspect of lean production and therefore of lean construction.

*Presented on the 3rd workshop on lean construction, Albuquerque, 1995

33
34 D.J. Fisher

It is a commonly known fact that we have entered the age of information. In fact,
one could say, to quote vice president Al Gore, that we are in the age of `exforma-
tion' because of the deluge of knowledge that is available to all on internal, corporate
computer networks, as well as externally on the world wide web. Peter Drucker
(1994), writing in The Atlantic Monthly, describes a social transformation that is
dramatically changing the socioeconomic makeup of the United States as the 'rise of
the knowledge worker'. This worker will need both formal education and a habit of
continuous learning (Drucker 1994). Corporations are finding that they must incor-
porate both continuous improvement and organizational learning in order to improve
business results and compete in a global economy (Gupta & Fisher 1994).

2 CONSTRUCTIBILITY REVIEW PROCESS

Constructibility is defined by CII as 'the optimum use of construction knowledge

and experience in planning, design, procurement, and field operations to achieve
overall project objectives (CII 1986)'. The use of the word 'knowledge' implies that
it can be thought of as is a subset of a body of knowledge acquired during the con-
struction phase of a project. This could include both knowledge that has been col-
lected historically with experience, or current new knowledge being acquired and
demonstrated in the form of best practices.
The NCHRP has funded a research project with the purpose of developing a for-
malized constructibility review process (CRP) for the state highway agencies to util-
ize, in order to implement constructibility into their project development processes
(PDP's). In this research project, a tool similar to business process reengineering
(BPR) was utilised to model the CRP. The specific process modeler that was used
was IDEFO, a modeling technique that was developed originally by the US Air
Force. This technique formalizes a process by identifying the primary functions of
the process and including, inputs, outputs, constraints and resources associated with
each function (see Fig. 1).
As with any process modeler, the intent is to model the process as it now occurs
(known as the 'as is' process) and then to reengineer that process in the form of a
`would be' model, attempting to improve the process by eliminating non-value added
functions. This is a basic premise of the new production philosophy (Koskela 1992).
The only problem with applying this technique to this project was that an 'as is' CRP
was non-existent for transportation agencies. In a survey of all 50 state transportation
agencies, it was discovered that only 23% of the agencies had a formalized CRP
process, and upon further investigation of these 'formal' processes, the definition of
`formal' was found to be quite subjective. Most of these 'formal' processes lacked
distinct functions or steps that lead the user through the implementation process
(Anderson & Fisher 1994). This is not surprising, since CII stated that the number
one barrier to constructibility was the perception that companies were already doing
that (CII 1993). Therefore, the researchers superimposed the CRP over the standard
transportation agency project development process (PDP) as the solution to process
modeling (see Fig. 2).
As a result of modeling, a useful, formalized CRP process resulted that is cur-
 The knowledge process 35

Controls

Inputs More General

Outputs

Mechanisms

a More Del fled

This diogrom is
the "parent" of
this diagram

rmcaon

Every component may be decomposed in

another diogrom. Every diagram
rrn shows the "inside of a box on a
10" parent diagram.

C
Function B is constrained by one input and
two controls and produces o single output
which constrains Function C.

b
Figure 1. IDEFO function modelling: a) Function box and interface arrows, b) IDEFO model
structure, c) Constraint diagram.

Boundory of ConstrucErbility
Review Process Syslern

Concepts.
Pions
Project De elopmenl Process
ng Design Conslruclion
Enhanced PDS
Operating
Nisei Ideas A A ► Focilily
Scope Sludy Compleled faculty

Project Enhanced
Droll Pions
CharocIrist
e Pions Specs &
and — Contract
Project Design Specs
Plans Document *deg Lessens
Learned
Concept
Pions
V V V feedtiali to
Oesigners for
ItAirre projects
Constufclidlity Construe COI ► iron,
to Planning to Design to ConslruChanY construction.
Cons rufiDdily Raring Process mainlenonce and
owe, head.
Construct • ty Co melds% Find Construclitiftly
Comments on Comments on Comments
Plonning Design

►
Projecl Life Cycle

Figure 2. Linking constructibility functions to project development process.

36 D.J. Fisher

rently being structured into the form of a workbook to train state transportation
agencies on how to implement constructibility into their standard PDP's. However,
perhaps more insight was gained by the researchers in identifying certain paradigm
shifts encompass lean construction principles. Paradigm shifts resulting from this re-
search were (Anderson & Fisher 1994):
—Existence of agency policy for constructibility;
—Use of project constructibility processes for design and construction;
—Contract strategy;
—Use of a constructibility consultant/engineer;
— Use of lessons learned;
—Use of constructibility implementation tools;
—Use of constructibility team;
— Enhancement of plans and specifications and contract documents;
—Feedback from maintenance and operations.
Even though it was beyond the scope of this project, these paradigm shifts indi-
cated that we began to look outside of the project boundaries and see the importance
of organizational culture and what changes are necessary for learning to take place.

3 MODELING THE LESSONS LEARNED PROCESS

The construction industry struggles with its ability to capture the 'lessons learned'
from its projects and activities for the benefit of future, similar work. Very often, the
knowledge gained on a particular project is lost with the changing or leaving of the
people who worked on the project. This problem occurs throughout project execu-
tion, but often is most evident during the later phases (i.e. construction and opera-
tions) when design is well complete. Owners and contractors must depend on job end
reports and/or rapid communication to transfer lessons learned from project to proj-
ect. In today's fasttrack project environment, this is virtually impossible without a
formal, systematic process that is to some extent automated. For these reasons, CII
has just begun a research effort this year to develop a lessons learned model for use
by its member companies, in order to implement lessons learned into the earlier
phases of a project so that mistakes are not repeated from project to project. This
model should increase the widespread use of lessons learned from previous projects
as a tool for continuous improvement.
In an initial survey, 45% of CII member companies state that they have a formal-
ized lessons learned process. As with the NCHRP project, we are in the process of
investigating these 'formal' existing processes, as well as identifying other best
practices, such as the Martin Marietta model illustrated in Figure 3a and 3b (Sidell
1993). We have learned, so far, that most companies are using some form of knowl-
edge sharing, such as Lotus Notes or the World Wide Web. We anticipate that some
hybrid formal process will be developed as a result of this research project for des-
semination to CII member companies.
 The knowledge process 37

Lessons Learned
System

Word Category Last 30 Days

Search Search Entries

Computers & Engineering

Administration
Telecommunication etc....
—Affirmative Action —Acquisition
—Communication — Database Management
All entries
—Management — Hardware made within
Searches — Personnel — Networking past 30
entire text calendar
of all Lessons — Procedures — Operations days
currently in — Recognition — Planning
infobase.
— Self-Assessment — Project Management
—Training — Procedures
— Other — Software
— Security
— System Support
— Training
— Other
Figure 3a. Lessons learned organization.

4 ISSUES IN KNOWLEDGE MANAGEMENT

If you view the knowledge process as containing the three areas illustrated in Figure
4, you will see that at the centre of the process is the knowledge itself, that is con-
tained within the knowledge management process of collecting, analyzing, and im-
plementing this knowledge into some sort of form or process that the organization
can use. At the recent Knowledge Imperative Symposium in Houston, TX, sponsored
by Arthur Anderson and the American Productivity and Quality Centre, we learned
that these two inner circles only represent about 10 to 20% of the knowledge process.
By far, the more difficult issue to address, and the one with far greater potential, is
the outer circle of this figure, that is to say the organizational learning culture. Per-
haps this is because of what Senge says 'the organization continually becomes more
aware of its underlying knowledge base — particularly the store of tacit, unarticulated
knowledge in the hearts and minds of employees (Senge 1994)'.
So if at the heart of lean construction is the management of the knowledge proc-
ess, what solutions can be applied to research projects at UNM, in order to make the
types of improvements in construction that Womack (1990) espouses in lean manu-
facturing? Solutions are found in the following issues, summarized from the recent
knowledge symposium that address how to implement the knowledge process into
38 D.J. Fisher

Industry Occurrence External Internal Tiger DOE Other

Experience Reports Audits Audits Team Info. Sources
—1--

LL Drafted
by Originator

To Validator

Valid?

es
To Coordinator

Green/Yellow
Red Only Is GN/R Only 101 Obtain Approval,
To LLS Mgr. Alert Issue/Distribute
Req'd? G/Y Alert
•
Co-Validate

Enter into LLS 4

Validate?

Is
Obtain Approval, Corr. Action
Issue/Distribute Req'd?
GN Alert

Ensure Entry
Into one of thee
C/A trkg. systems

'Track Status

Verify Closure

Does Item Flag for

need periodic Review
review?

Close

Figure 3b. Lessons learned system flow.