Presentation on theme: "As important who I am not Who am I and my motive"— Presentation transcript:
0Linbeck Lean Project Delivery We started our Lean Journey about 10 years agoOriginal founding members of LCIThe tools displayed today are an evolution of lean conceptsUsing a hospital client and project as examples today
1As important who I am not Who am I and my motive IntroductionWho I am not?I am not a Lean consultantI have nothing to sell and I am not being paid to be hereI am not an academic with a hypothesis to proveWho am I?President & CEO for Linbeck Group LLCI am a builder; have never done anything elseI have a passion for the construction industry and finding ways to improve itAs important who I am notWho am I and my motive
2Lean Definition What is Lean Construction? “Lean Construction is a set of ideas, practiced by individuals in the construction industry, based in the holistic pursuit of continuous improvements aimed at minimizing costs and maximizing value to clients in all dimensions of the built and natural environment: planning, design, construction, activation, operations, maintenance, salvaging, and recycling.”
3Why? Why did Linbeck start doing this more than 10 years ago? Competitive ReasonsWhy should others do it?To survive!
4Don’t We Do This Already? Some say yes – Life is easy; they already have all the answers.Those who say no - Should they feel compelled to do something about it?
6Industry Reliability Model 50%25%10%90%75%TimestartcompletionConstructionIndustry NormLost OpportunityIndustry Wastes 40-50%ReliabilitySince I started 30 years agoEfficiency expertsHowever-no solutions that sustained(do it better, but circumstances remained the same)A new leadership to addressChange to a Lean environment
7Construction Professional? Do you think the best and brightest want to work this way?Sounds like a career of endless issues and unnecessary risk.Are you considered a professional because you survived it?
8Dr. Jose Solis – Construction Science Value/Waste RelationVARIABILITYWASTEVALUEDr. Jose Solis – Construction ScienceDrive to predictability vs current variabilityPREDICTABILITY
9Waste Types: Discrete, Synergistic, Systemic Production:UnderOverUntimelyPerformance:NonChangeScopeConditionsErrorsExternalDiscrete WasteSystemicWasteCapital FacilityProcurement andProductionSystemsSynergistic(Affecting stockholders)OwnerDesignersContractorTrade PartnersSynergistic Waste (x)(Affecting Stockholders)Discrete Waste (+)Systemic Waste (xn)Project Delivery System – ContractsSystemic nature of the industryProject BreakdownLitigation (shift of value)Devalued MarketNational DebtDiscrete waste is additive(symbol +)Organization - Synergistic waste is multiplicative (symbol x)Commercial Application - Systemic waste is exponential (symbol xn)25
10The principles we use for all things we do; not just projects Lean PrinciplesLean Thinking seeks to eliminate waste in both schedule and budget, so projects are delivered faster - and more cost-effectively.The continuous application of the four steps aboveDefine Client’s ValueMap Value StreamAchieve Value FlowRespond to PullSeek PerfectionActively understanding what is valuable to our clients in terms of budget, function, aesthetics, standards, and timeIdentifying the most effective sequence of activities to deliver the value defined by the clientEliminating unnecessary procedures to allow more work to be scheduled and executedDoing work only when needed - when it triggers downstream tasks that will advance the overall processThe principles we use for all things we do; not just projects
11Lean Operating SystemTake those Lean principles and create a Lean Operating System (LOS)Plan – Do – Check – ActKPI – Key Production IndicatorsSeems simple, but not intuitive to a project delivery based industryThis is how we reduce Discrete Waste
13Defining Value – What is valuable to your customer? First Lean PrincipleDefining Value – What is valuable to your customer?Remember, I am not an academic or consultant; so I am presenting lean practice examples.
14Cook Children’s Mission Cook Children’s Health Care System will improve the health of every child in our region through the prevention and treatment of illness, disease and injuryThe first principle involves our customers on projectsProud of our involvement in HealthcareWhat do we contribute?
15First Principle – Defining Value to CCMC Reliability - Capital Cost BudgetingSpeed – Time to MarketUptime - Patient Care AreasCustomer Satisfaction - Maximizing Positive Patient OutcomesControlling Infection – Safe Environment for HealthcareCost – Leveraging Market Knowledge, Community Reputation & FairnessQuality - Focusing on Long Term Facility Management, Operations & Maintenance at Lower CostCommunity Service – Support CCMC community missionFirst Principle:How do we support the mission?Make the hospital’s business betterThe value we can bring – key point
16Fee @ Risk to Meet Owner Goals • Removes the perceived conflict of interest in determining the Guaranteed Maximum Cost (GMP) of the project• Prevents focusing on cost only, since the Client also has safety, quality, schedule, and functionality goals• Decreases motivation to argue over minor changes, since there is no economic interest in increasing the contract amountWe put skin in the game to motivate our actions.This encourages more progressive management practice.
17Second Principle – Map the Value Stream How we create value by removing discrete wasteProductionUnder productionOver productionUntimely productionPerformanceNon performanceUnder performanceOver performanceUntimely performanceChangeScope changesChange in conditionsErrorsExternal changesValue Stream2nd Principle – Discrete WasteIncrease reliability by removing wasteMapping how to extract valuePlan activity of the LOSEliminate discrete waste – Production, Performance, Changes
18Define what you are doing Experiment and improve Lean PrinciplesThe right process will produce the right resultsContinuously experiment and improve the processDefine Value, Map Value StreamEngages stakeholdersEngage stakeholdersDefine what you are doingExperiment and improve
19All company processes are based on value streams Value Stream of Capital Project DeliverySee Feb 08 Board Package RecapSee April 08 Board PackageSee Definition VS for ProjectsAll company processes are based on value streamsFor the projects - Assessment, Definition, Design, Construction, Post ConstructionVS is a detailed overlay of (Plan – Do – Check – Act)Updated based on decisions in Feb 084/15/18
20Linbeck Sponsored Insured Program (LSIP) How Linbeck implements a contractor controlled insurance programRepresents actions from:Legal, Operations, Risk Management, Accounting & WillisIt’s an agreement on what is valuable or necessary, how to execute and by whom.
21Project Scope Waste Typical Bridge Work Structure Closing ER entrance for 42 daysIdentify BridgeCriteriaManage Operations DisruptionManage Patient DissatisfactionManageInefficient WorkOwnerArchitect / EngineerDesign BridgeComponentsBid Erection andEnclosureAward TradeContractsBuilderClose Entrance toSubcontractorFabricate BridgeSteelQuoteEmergency RoomWhat’s important –Construction EfficiencyHospital/Employee EfficiencyCustomer SatisfactionThey all are!VS represents a “Project Oriented Approach”Labor/Delivery to NICU – Emergency at 1st floorLegendOpen Streetand EmergencyEntrance after42 DaysErect Bridge Pieces 14 daysOpen One-HalfStreetEncloseOne-HalfBridge14 DaysEncloseLast One-HalfBridge14 DaysContractual RelationshipClose One-Half StreetCloseStreet
22Linbeck’s Lean Process Keeps ER Entrance Open Closing ER entrance for half dayArchitect /EngineerBuilderSubcontractorProvideConstructability &Manage ClientExpectationsOwnerIdentifiesProcess(Value)MinimizeDisruptionOf BridgeConstructionIdentify BridgeCriteriaCloseEmergencyRoom EntranceOne-Half DayDetermine DesignOptions toAccommodate LessIntrusive Bridge PlanDesign TempSupports andLiftingRequirementsBid AssembledOn GroundBridge ErectionQuoteFabricateSteelAward TradeContractsDrill TempPiers7 DaysErectBridge on Ground 7 DaysAssemble Enclosure on Ground 14 DaysStreetBridgeOne-HalfDayOpen Street and Emergency afterDesign BridgeComponentsBetter construction (took a risk)Went against Supt. & field engr. advice.Hospital employees not affectedCustomer not affectedLegendContractual Relationship
23Third Principle – Achieving Flow Achieve flow by removing synergistic waste creating reliability with organization that addresses product needsRelationshipsOwnerDesignersContractorTrade PartnersFlow3rd Principle – Synergistic WasteSynergy is relationalOrganize the team to produce product specific outcome
24Owner Direct Contractor Integrated Project TeamIntegrated Project TeamUtilizing TeamBuild®ApproachCMR –LinbeckArchitectsINTEGRATIONCCMCOwnerOwner Direct ContractorEngineerLinbeckProjectManager1st step in relational integrationLinbeck as an “At Risk program manager.”This is not an industry supported approach, but necessary for advanced lean approach.Specialty ConsultantSpecialty ConsultantFF&E Vendors
25Able to support capital projects strategic vision with Board Organizational AlignmentAble to support capital projects strategic vision with BoardSupport operational needs with hospital President/StaffInformation provider to Finance, IT, SecurityRamp up or down as facility group needs support
26Core Specialty Contractors Integrated Project TeamOwnerLinbeck RiskArchitect & EngineerCore Specialty ContractorsINTEGRATION2nd step in relational integrationLinbeck as an “At Risk program manager” with Arch/Eng, Core Specialty Contractors, Owner.
27Implementation of BIM in the LOS Create the right “flow”Involve the right people at the right timeAllocation of responsibility and authorityCreate clarityMap out the process and the value stream“WHAT” “HOW”BIM is a lean toolIntegrated into LOSWhat we want from it – by whomHow to use it
28Communicating via Model Communicating via Model Lean BIM ToolsFastBIM ToolsEarlyProcurementCommunicating via ModelQualifying TradesGMP at SDFastBIM ToolsEarlyProcurementCommunicating via ModelQualifying TradesGMP at SDBIM ResultsProject focused delivery would take 62 monthsLOS approach – 49 mo’s – saving of 13mo’s/or $110M/RevenueLOS with BIM – 37 mo’s – 12 mo’s or additional $102M/RevenueTotal Savings to this project = 25 mo’s or $212M/RevenueWithout BIM, we could not get the additional 12 mo’s28
29Fourth Principle - Responding to Pull Respond to pull by doing work at the last responsible momentUse pull driven approachDefine what is neededCreate what is definedNot moreExecute flawlesslyReliability creates a vacuum on the projectNext steps are ready as planned (not traditional)2 week schedule exampleMust be ready to take advantage of processThe DO step of LOS
30Involve users, designers, builders Start with ultimate desired outcome Using Tools – Pull ScheduleInvolve users, designers, buildersStart with ultimate desired outcomeWork back to start of project (not intuitive)30
31“Stored” in Location in Assembled Sections-Protected Responding to PullPull Built-Up AHU’s - Design Through ConstructionBelow Grade Access“Last Opportunity”Shipped in “Larger” Sections“Shrink Wrapped”“Stored” in Location in Assembled Sections-ProtectedAHU’sDesire this to be stored on site – assembledShipped on time – shrink wrappedDelivered at last (responsible) possible moment before basement mechanical room access closed
32Percent Plan Complete Chart – Seeking Perfection Baylor College of Medicine5th Principle – Seeking PerfectionNeed reliable commitments:Organize themMeasure themUtilize Last Planner SystemLast Planner is the ForemanThe Check step of LOS
33Cumulative Root Causes Trend of Unsatisfied Schedule ItemsNeed to know root causes to eliminate them (removing bottlenecks).Act part of the LOS.
34Using Tools – Last Planner When Reliability Increases90%LOS75%Saves Time (10-20%)ReliabilitySaves $ (3-10%)50%25%ConstructionIndustry NormLOS and initial relational organization removes a significant amount of waste.Operating System / Organization“Discrete Waste” “Synergistic Waste”10%startcompletionTime
35Where Are We Going? – Remove Systemic Waste With an ever-changing economy1900“favoritism”InformalDesign Bid Build2000Under-Bid LitigationDesign Build/CMAR2010Under Cut Fees/Market ValueLean/ Integrated ContractFutureProblem?Solution?Problem:Solution:Discussed discreet and synergistic waste removalIn the future, we focus on systemic wasteCurrently starting an IPD
36Commercial Application Systemic WasteRemove with IPD agreements/relationshipsProject Delivery System – ContractsSystemic nature of industryProject breakdownLitigation (shift of value)Overcome Devalued MarketOvercome National debtCommercial Application
37Lean Operating System supports the implementation on IPD project delivery. Most of the IPD concepts can not be optimized without a Lean Operating System.
38Waste Types: Discrete, Synergistic, Systemic Production:UnderOverUntimelyPerformance:NonChangeScopeConditionsErrorsExternalDiscrete WasteSystemicWasteCapital FacilityProcurement andProductionSystemsSynergistic(Affecting stockholders)OwnerDesignersContractorTrade PartnersSynergistic Waste (x)(Affecting Stockholders)Discrete Waste (+)Systemic Waste (xn)Project Delivery System – ContractsSystemic nature of the industryProject BreakdownLitigation (shift of value)Devalued MarketNational DebtOperating System - Discrete waste is additive (symbol +)Organization - Synergistic waste is multiplicative (symbol x)Commercial Application with relational type agreements - Systemic waste is exponential (symbol xn)25
39Integrated Project Delivery When Reliability IncreasesIPD90%LOS75%Saves Time (10-20%)ReliabilitySaves $ (3-10%)50%25%ConstructionIndustry Norm10%Our new target – start out LeanIPD allows you to start at a more reliable platformstartcompletionTime