The Construction Industry Institute has estimated that only about 10 percent of what the construction industry does on a project is value added. Another 33 percent is attributed to support activity, but an unacceptable 57 percent is considered waste. A certain amount of support activity is definitely beneficial because without planning the waste would be even greater. Ouestion is how can we reduce the amount of necessary support activity required? However, the most important question is how do we reduce the waste in the construction process? It’s not realistic to believe that we can totally eliminate all waste; however, manufacturing has only about 26 percent waste or a little less than half what occurs in construction.
Henry Ford said almost a hundred years ago, “The best way to grow a business is lower costs.” The best way to do that is to eliminate work that does not contribute to the value of the product or service.
Before everyone starts pointing fingers at each other, keep in mind that all project stakeholders in the construction process contribute to creating the waste and the worst offenders are often the buyers of construction services because they actually create wasteful rules or unproductive requirements.
Most people connected with the construction industry are well aware of the waste, which shows up in longer schedules and increased costs. The mistake that is often made is trying to fix a complex problem in a single step. For example, the goal may be to reduce waste by 30 percent. Because it’s difficult to find a solution that will have that kind of impact, the initiative often dies out. Attempting to fix large, complex problems all at once makes the process very complicated. The greater the complexity, the greater the resistance to change and the more problems there are in attempting to implement the change. In addition, large complex changes usually require a significant investment in time and money, resources that are often difficult to obtain. These reasons contribute to large initiatives not achieving their objectives.
In contrast, the concept of Kaizen focuses on tiny, easy to implement improvements on a continuous basis.
Unfortunately, too often small changes are discounted because they are perceived to not be worth the time and effort. Yet, many small improvements can add up to significant savings. For example, a flight attendant for American Airlines suggested a way to save 7.5 cents on every flight. While each savings is small, it resulted in an annual savings of $62,000. The reality is a one-tenth percent daily improvement, the equivalent of about 28 seconds a day, will double productivity in three years.
One of the largest wastes is the underutilization of employees’ potential. This is a disaster. Multiple studies have discovered that a majority of award winning innovations were initiated by an individual; not as a result of management initiatives. Those initiatives started by individuals created greater impact than those started by management. The answer is to start a Kaizen program, or continuous improvement process, at all stages in the construction process.
Creating a continuous improvement process
Fortunately, the Kaizen approach helps to overcome both of these challenges.
How to start a continuous improvement program
The trick to making this process work is to be supportive. Don’t judge people’s suggestions. Since by definition Kaizen changes are small, you can afford to let people try them. The rule is that they must create an improvement or they aren’t implemented, so if they try it and it doesn’t create an improvement it’s a no go. However, avoid judging before they try it. The exception is if something would cause a safety issue, then you can overrule.
Finally, after a suggestion has been tried and works, it should be posted so other team members can learn about it. This process is simple. Indicate what the problem was, what was done, and what improvement was realized. This should take less than 75 words and if possible include pictures.
–by Ted Garrison
Ted Garrison, president of Garrison Associates, is a catalyst for change. As a consultant, author and speaker he provides breakthrough strategies for the construction industry by focusing on critical issues in leadership, project management, strategic thinking, strategic alliances and marketing. Contact Ted at 800-861-0874 or [email protected].
Further information can be found at www.TedGarrison.com.