Lean Procurement and Management Ministry of Justice Terry Stocks Presentation for the Construction Industry Council June 14 th 2012

Previous Presentation given to the council members in October 2009 A common Purpose (Supporting Growth – Better for Less) Presentation contained the MOJ’s lean delivery process. Projected benefits at that time (Update) Current State New Initiatives Lessons Learned Future Initiatives Content

CapacityGrowth Value A Common Purpose

System approach to Project Management System: Provides a clear set of benchmarking data Supports collaborative working Provides performance data to “prove better for less” Provides the tool to support a Lean culture Supports continuous improvement Focused problem solving And Much More Lean in Construction

Yr 1 Yr 2 to 5 Yr 6 onwards System in place, Data cleaned Training in basics Culture change starts Developing understanding Supply chain barriers System bedded in Reliable data Continuous Improvement culture at client level Moving to flow orientation. Supply chain use system 2015 onwards System is the norm Data is driving improvement CI at most levels Flow used in most areas. Supply chain drive improvement Cost reduction 5 to 10%Cost reductions of 6 to 24%Cost reductions of 25 %+ Delivery reliability At 60% to 80% Reliability up to 90%, 10 to 15% off project time Reliability 95%+ Project times Improved by 20 to 50% Defects/rework/delays identified and base lined Defects/rework/delays reduced by 15 to 25% Defects/rework/delays reduced by 50 to 80% State Benefits Time Cost Quality Yr 1 Yr 2 to 5 Yr 6 onwards Achieved Vs Predicted (October 2009 Base)

Performance Data AreaNational Construction Industry KPI (2010) MOJ Data Returns Project Cost Predictability 52%100% Project Time Predictability 43%70% MOJ Data AreaMOJ Data Returns Increase in product value 20%Actual constn cost as % of project out turn Claims value (% of project budget) 1% Projects contract cost < pre contract estimate 86% Projects complying with Lean delivery process and reporting 100%ECI, Buffered programme, delay analysis, RCA, CI MOJ – Lean Performance - Evidence

Standards are modelled / depicted as elements CellOfficeClassroom Roof Current Standard Docs and Specifications Elements copied and arranged produce required product Outputs in 3D, or Excel data sheets, 2d plans etc Automatic QA QA is inbuilt as outputs automatically report non compliance as rqd standards are embedded Standard elements build up required output Reduced Design More Money spent on Asset Using Tools – BIM – Helping to drive out waste

Industry (Professional Service providers and contractors) do not practice collaborative working Constructors ability to deliver a project to an agreed programme is poor Industries awareness of process waste is low Industries capacity / will to lead change across their client portfolios is low Need very clear communications and training to set expectations Without framework relationships – changing culture would be very difficult Lessons Learned

The Future Directorate Costs (MOJ Costs) Technical Supply Chain Costs Constructor Costs (OHP, Mgnt, Prelims Etc) Delivered Product (actual bldg & labour) C C % Q R T C Q R £/m2 £/Unit Convert current PPI process into a fully accessible software system (Summer 2012) Put in place a training programme for the whole supply chain on collaborative working, lean, data management etc Re tender the current professional service framework to support collaborative working goals Develop a full set of BIM libraries and have all projects delivered in a BIM environment by September 2013 Measure the outcomes Reduce cost of project delivery by 20% in this SR period (Cabinet Office)

Thank You Questions