Often in infrastructure, construction, and building project designs, planning and control are replaced by chaos and improvisation. This chaos and improvisation then generate excess waste and inefficiencies, and therefore need to be avoided. By implementing lean principles of continuous improvement from the systems of Lean and Six Sigma developed in the automotive industry, construction processes entailing material and labour resources can be improved such that substantial cost reductions in the range of 15 to 30% can be achieved.
What is Lean Six Sigma?
The lean methodology was developed with the ultimate goal of reducing costs and increasing efficiency by identifying and eliminating activities in a given process (service or manufacturing) that fail to add value and yet consume resources. In the lean terminology, value is defined as ‘what the customer is willing to pay’. As a result, lean is heavily oriented not only toward efficiency and cost reduction but also toward creating value to ensure customer satisfaction.
On the other hand, Six Sigma is a system developed with the goal of controlling variation and making processes more consistent and reliable to ensure the quality of deliverables. The combination of Lean with Six Sigma results in a faster creation of value at the lowest possible cost.
Lean within Infrastructure & Construction Industries
Many infrastructure systems in North America are aging, and it is difficult for municipalities and governments to devote the tax resources necessary to repair the infrastructure gap, especially at the current rates of productivity and efficiency. For example, in Ontario it was reported by the Association of Municipalities that an 8.35% increase in property taxes until 2025 would be required if the infrastructure gap in the province was to be eliminated (“What’s Next Ontario?”).
Infrastructure projects need to be shorter and cheaper while minimizing community disruption.
Thus, it is important for local governments and municipalities to be more efficient with the resources and budgets available to get more infrastructure for less. This can be accomplished by harnessing the power of lean thinking in order to create citizen value while reducing costs and eliminating unnecessary waste, which has been shown to be effective in vertical construction projects.
The biggest impediment to construction productivity and operational efficiency is wasted time and delays. It has been shown that as little as 40% of construction workers’ time adds value. This can be seen in case studies involving highway bridge constructions where only approximately one-third of activities for both rebar installation and asphalt paving were attributed to direct work in contrast to wasteful activities that comprised 30 to 50%. Under a traditional design-bid-build (DBB) project delivery method, the construction industry in the US failed to improve productivity between 1960 and the early 2000s, while the productivity within non-farm industries more than doubled during that time.
Productivity in construction can be evaluated through several key performance indicators:
- Client satisfaction
- Cost predictability
- Construction & labour costs
- Day-to-day project completion ratio
- Number of defects
- Percentage of equipment or labour downtime
- Ratio of value added
- Time for construction
- Time predictability
Lean methodologies have the potential to address infrastructure and construction challenges and improve these KPIs to achieve higher quality, faster completion, and more efficient delivery. By implementing lean at all stages of construction, beginning with the design phase, there is a cascading effect that ultimately better achieves customer needs: waste is reduced when removing obstacles of construction activities that prevent work from being done, leading to workflow improvements that positively impact productivity.
Process improvements have been seen in case studies that have implemented lean strategies such as standardization, strategic gap analysis, pareto charts, fishbone diagrams, process mapping, 5S strategies, and improved supply chain logistics. For example, scheduling tools were able to increase efficiency and reduce waste, which included pre-task planning techniques such as daily huddle meetings, last planner systems where work is scheduled by the person closest to the work, or pull schedules where a project is planned in reverse. Simulation and modeling techniques, such as Building Information Modeling or Integrated Project Delivery, provide efficient virtual planning options prior to initiating construction. Value stream mapping is a useful process that documents the flow of information and materials required by a process in order to identify the amount of value added for each task.
However, making fundamental changes to how companies operate is not easy. Lean requires culture change from within and buy-in from all levels of employees. Continuous training and repeated kaizen events are necessary for lean to become engrained within the company. Further to this, there are potential issues when getting unions on board with such fundamental transformations. Lean tools such as “change management” provide powerful resources for helping stakeholders produce desired changes when faced with the natural human response to be resistant to such change.
Lean Six Sigma Training & Implementation
At AMSaxum we provide onsite corporate training on lean six sigma/continuous improvement methodologies and help our clients with the implementation of process improvement projects. There are government grants available in Canada and the USA to cover the cost of corporate training.
Government Funding & Assistance Options
In addition to the tangible benefits possible through lean, the research and development required for many aspects of infrastructure and construction projects require the use of significant resources (labour and materials) that could be eligible to be recovered through government funding where applicable, such as through the Scientific Research & Experimental Development (SR&ED) program in Canada.
For companies in North America, specifically, there could be applicable grants to aid in upfront costs such as capital investment and employee training. AMSaxum experts in government funding help with the application of these grants and with the preparation of SR&ED claims.
There are additional tools that can aid in improving overall efficiency, such as an RCCA labor tracking solution we offer, which is an application for collecting data or for tracking labor or KPI efficiency.
For more information on continuous improvement and Government funding within the infrastructure and construction sectors call AMSaxum at 905-315-6847 or contact us here.