Companies sharing their progress and learnings implementing a lean approach to project delivery. Eight Presentations, over 50 attendees, three from Denmark including one from the Danish trade unions.

---

08:22 7/21/03

Value Control in the Building Process

Anders Kirk Christoffersen, Niras, Denmark

Premise: Design is a value-based activity requiring all stakeholders in the project.

Approach:
They take a workshop approach conducting a series of meetings with stakeholders.

• Workshop 0: Partnering
  Project Basic Values and partnering agreement
• Workshop 1: Vision
  Design Proposals
• Workshop 2: Realism
  Conceptual Design (sometimes takes 2 or 3 workshops)
• Workshop 3: Criticism
  

They track satisfaction of the stakeholders through the process considering product value and process value. Claim team building and ownership development are usual side effects of the process. Use the value tracking mechanism throughout the production/construction phase of the project.

Speculating Quality Function Deployment and Multi Criteria Decision Analysis could be used for tracking the progress establishing design.

Discussion:
Looking for objective criteria for measuring value created. Kinds of projects: housing, museums

Comments:
I call this collaborative design. Anders presented the approach to design was presented as a linear process. I speculate that it comes off as an iterative process.

---

09:00 7/21/03

Design Management -- Developing a Lean Approach

John Brock, Burt Hill Kosar Rittelmann Associates (architects)

Premise: Design management is not practiced or taught as a discipline. Absence of thinking and participation in the development of project delivery.

Approach: Begin projects doing a facilitated definition phase in collaboration with the client using a Disney-like story board tool. This brings the process of architecture to the client. Brings together concept budgets with visualization tools sketching rather than using CAD to keep from presenting what could be mistaken as 'final' design. As then process progresses advanced 3D and 4D tools are introduced.

There is a need for a better tool. Developed a computer-based tool, Project Desktop: schedule, budget, design, marketing, deliverables all in one workspace. The schedule component includes phase and look-ahead schedules and weekly workplans along with tracking PPC (percent of plan complete). Project Desktop is built on QuickPlace, Lotus Notes.

Goals

1. Improve Project Management: efficiency, utilization of resources, and value generation
2. Increasing Profitability: p
3. Transition to Model-Based Design Process: (upcoming implement ion)

Discussion:

How soon is client involved? Right away. No one knows more about the client business than the client. Can't involve clients too soon.

Do you see a trend or see the possibility for different fee structures? During workshop phases retained on an hourly basis. Once scope is established contracting on a lump sum basis.

Remote work sites with poor bandwidth gets in the way of using project desktop technology.

Do you need additional people to maintain these workspaces? Currently using project administrators to keep up to date.

Comments: Making great headway in challenging current practices. These folks are both hopeful and diligent. Let's keep watching their progress.

---

09:31 7/21/03

Digital Prototyping: A Tool for Integrating Product and Process Design

Roberto Arbulu, Strategic Project Solutions

Premise: Digital modeling not only improves construction flow, but it produces ownership among then workers for the results.

Approach:

• Mapping the value stream
• Collaborative working on product and process
• Make mistakes in the model not on the work site
• Difficult to change how people think, so they provide rational 2D drawings with the 3D models.

Used a 3D model to create a 4D movie presented in a reality center used to introduce the construction team to their up-coming work. The team watching found a few mistakes that were eliminated before their work on the site.

Reduced lead time from 6 weeks to 5 days

Discussion:

Did you use crew foremen in the definition of the model? Yes, throughout the process.

How many repetitions (repeatability in the design) is required to justify digital modeling? Difficult question to answer. Standardization of product design through building the models allows for pre assembly. That takes tremendous amounts of time out of the process.

How long did it take to put together the model? Two people in less than 2 weeks could design a complex rebar structure.

Could you get the same results using field mock-ups? The beauty of using digital models is to test and make mistakes in the model rather than the field. Could design 3 or 4 times in one day.

Could the team on site make modifications? No. We build a first-run study. The team was able to follow the process from then on.

Does the software detect errors in the design? No. It was designed for use in manufacturing settings. Regulations of the construction industry are not embedded in the software.

Is the model industry foundation classes (IFC) compliant? The approach is to increase productivity. Beginning to study how productivity is increasing. Cycle time is decreasing.

Comments:

The participants were almost captivated by the state of these digital modeling tools and current use. They show great promise as a learning and collaborative design environment.

---

10:35 7/21/03

Morning Panel Conversation on Design

Moderating: Carlos and Sven Bertelsen

Carlos: From our experience the reality is much more difficult than Anders spoke of. First stage of client development you have more than one client: investor, users, managers of builder. How is decision-making done among the parties. We try to make requirements explicit from the design solutions. Challenge is you have too much information. Difficult to run a meeting with large group of people. Finally, how to achieve design maturity -- in a condition to be released down stream.

Anders: All users must be represented at the workshops. They end up doing the work themselves. They need to address the 'silly questions'. Tends to bring out client complexities. They get to face the problems.

Anders: We try to be both pragmatic and detailed with the information collected. (The workshop) gives a lot of information. On large projects you might need tools to keep track.

Anders: We have tried breaking a large group into smaller groups. We often have 30 people around the table. We are having some thoughts about how to do that. It is very essential that everyone is heard at the workshop.

Anders: The mental phases of vision, , and at the end of the workshops people are running out of things to say. You know when you are there. It might not be a problem (identifying maturity).

Carlos: Doing some work on planning and controlling project development. We get good experience with weekly workplans. We have some difficulty with the LAP. We find we must pool resources. The process changes based on experience. It is easy to develop a project website using simple tools. The commercial products give you too much information. We try to use information from the project extranet. We get to see how people are using the information. Please comment on people not using the information available to them.

John: We found a three or four week look-ahead works for us. We have some travellers (architects) who are always available. As we get within 6 weeks of a milestone we might extend the LAP to that milestone point. Designers don't do well with micro management. It is an environment of bright people who are not necessarily great communicators, not managers. Use two week blocks for them.

John: I hope what we're doing with the project website comes across as simple. While much of the information is available elsewhere it gives the team what they need in one place. We have found that among our architectural engineers people have different dispositions. We need to be careful who we assign.

John: We are building in the PPC measurement. If we are carefully pulling tasks from the master schedule then it is a good measure.

John: Commenting on Anders questions, in order to facilitate 30-40 people in a design workshop, we'll set-up a series of shorter meetings prior to the larger meeting. This allows us to collect information and to get people thinking ahead about the workshop they will attend. We bank information for later use. Bringing people back together we summarize for them.

Roberto: The combination of a LAP and the right sequence is what matters. Lack of integration between design and construction produces the situation of mis coordination.

Carlos: We're not using sophisticated tools in Brazil, but doing detailed operation design is very important. You didn't mention safety in your presentation of digital design. Wondering if you are using safety considerations in your modelling? Once you've done your first design, i SUPPOSE YOU use first run studies. How would you use digital modelling on a much smaller project (than Heathrow Terminal Five)?

Roberto: We are using the 3D model to elevate safety considerations. We can use a video from a 3D model to show people the risky aspects of an assembly process.

Roberto: Back to what Anders was saying, it is extremely important to put the right guys in the room. We create a standard process for performing the work. By putting the right people in the room we can examine multiple scenarios.

Roberto: We are learning a lot we can take to small projects. There is a total lack of integration of design and construction on small projects.

Paulo: Anders, it is difficult for me to understand when you put everyone together you can find something in common among them. The owners might like something that the authorities don't like. Unless you act only receiving information unless you establish the borders. You have knowledge and they don't. You can create wicked problems. Need to do three things at the same time not in series. I want your opinion about that. My second question is for Roberto about drawings. It is very good to use software, but we must be aware...as we increase technology in a decision process we decrease people commitment to the result. People see themselves as too small compared with technology.

Anders: In the normal process you have conflicting interests. You define them along the line. THe workshop is very effective to raise those conflicts. I am not afraid to have authorities in the workshop. We set ground rules for their behavior. Authorities are asked not to restrain the visioning. That can come later. I have found that the authorities are very good in workshops. They become value players.

Paulo: Do you set rules for authorities to guide their participation?

Anders: They are told they are allowed to dream and to present their dreams.

Roberto: The point is do you tell people what to do or to ask them how to do it. In the second case you get commitment. The solution belongs to them.

Audience: Does your firm represent the buildability?

Anders: The goal for the workshop is to have all competencies present.

Audience: If you are at a phase where you don't have detailed drawings for a selected contractor how do you get people to participate? They have no stake.

Anders: We have people participate for a fee.

Audience: Can we use the last planner in the entire design phase? (early phases)?

John: We find it is effective when we begin to bring other team members on board. At the time it is just one or two people it is not effective. There's a tipping point where you are coordinating a couple of people to multiple disciplines where it becomes effective.

Anders: LPS™ is not the tool for the very early phases. It is suitable for the production phases of design.

Carlos: We use LPS in homebuilding. Plan the whole work of project definition for a portfolio of projects.

Sven: Can easily use LPS through the project definition phase. You need to understand it as a commitment-making process. The Danish Broadcasting System for establishing firm commitments up front.

Mike: Describe the process for designing the operations. Best done where you are upstream of rebar design. Can you see an application for highway detailed drawings.

Roberto: You've described the whole value stream for rebar. We have designers creating a sketch. The details are then done in 3D model. The model is used to find problems with the design. The designer approves the 3D model. Designers approve all details. Fabrication details go to a real factory. Fabrication is done according to how the rebar is needed. You asked about iron workers. We get the real input from the workers when they start building it on site. The third question on highway...when you are talking that amount of walls there is certainly an application.

Mike: Did the iron workers take offense to being presented with a 4D model?

Roberto: There is a co-creation process. We include the foremen. Not including them is a major mistake.

Sven: There is a new understanding of the construction process...there is a focus on cooperation. It recognizes we are dealing with a very complex nature. Calls for a new way of doing things. It also calls attention to wicked problems. This focus on cooperation requires we have trust. Our ways of acting is we believe people will cheat. We have to find new ways to introduce trust. The focus on value is very important. Opens an interesting issue to balance cost and value. Finally, the use of computer tools as a means of communicating possible outcomes to stakeholders who are not professional in construction.

Sven's three questions:

1. How do carry costs under control? The clients' perceptions of costs are unbalanced.
2. Seen in Denmark that design professionals don't participate in project management.
3. What is the use of IT in the whole process? There is a danger that IT becomes more important than the problem we are trying to address.

John: Communication and trust make it worth the risk to include expanded participation in the workshops. Facilitate the solving of the problems in the early days rather on the jobsite. We do conceptual estimating to help the client understand choices. We do this in the workshop. As we get into later design phases we can do better estimates. This prevents runaway client expectations. With regard to IT, at least in our company, we were delegating IT to the bright your people who can use the computers. In this decade those of us with gray hair have enough computer intelligence to make good decisions on how IT will be used. We are balancing IT with low tech tools (sketching). Designers in general went to school because we liked design. We were not interested in a business school degree. Schedules, Last Planner, are not attractive. We run away from things that smack of business management. I am hopeful that with a good simple tool it will start to make the management functions happen because it has good steps built into it.

Roberto: In answer to your question about cost, we all in construction talk about cost. We must show the customer what is the value first. We need to understand what the customer wants and then take the time to check if that is what the customer requires. We then can think about solutions. We have been missing the first step of understanding and defining the value with the customer. You worry about IT becoming more valuable than the problem...people tend to jump into solutions without stopping to consider what we are trying to do.

Anders: The new way of doing things demand new skills. COst estimating is one of the skills we need to improve. We must learn to balance costs and values. The other skill is process facilitation. We learn very little about it as designers studying. Even people that are not used to drawings and our language they do quite well in workshops. Coming to IT, early visualization is a simple tool that works. It is possible with not much man hours.

Sven: Professional involvement...designers don't want to communicate closely with the client because it disturbs the architecture.

John: I think you are talking about the architect ego. I am the designer; everyone else is here to serve. We are not that kind of company. We need to keep pressing on better processes so we can still have great visionary designs and build them more responsibly.

Roberto: We have to remember who is the customer. Maybe the most important customer is the people who are building the project.

Anders: Some time the architects fear the workshop thinking they are not in control. Even the architects with the big 'A' see the opportunity in doing better design.

Audience: There is a trend from adversarial to cooperation. Do you see some shifts in contracting to facilitate the change? Specialty contractors today might not have the budget to work more cooperatively. Is change order the only solution to that? Is the customer willing to pay?

Anders: It is a common thought that it is more costly. The experience is the more time spent in workshop creates value and avoids cost. As we get used to this way designers will see more value.

Roberto: I can tell you...let me use my example: you can use these models to make money for yourself. The involvement of the owner is a must. It is the first door to knock.

John: The collaborative process saves steps and improves profitability. Really good project management has produced good value. It just seems that good weekly coordination helps everyone. It reduces chaos. It is really a win-win. I don't have the financial concern.

Roberto: THe workshop process focuses the work on what needs to get done avoiding the build-up of details that are not needed 'til later.

Anders: There is a greater risk in other places than in the collaborative process.

Sven: Who should be the change agent in changing construction organization? It should be the client. He has the money. He can help constructors change. I think we have to ask some leading clients to help us change our behavior. Big customers can really push by adding money in anticipation of saving money later.

Audience: Really impressed with the three workshop approach. That all the values are performance based. Do people leave workshops and fall into old ways?

Anders: That happens. You have to help people adopt the new ways. It is not our culture yet; one day it will.

Paulo: I am very happy to hear the word 'perception'. When we talk about client values we have to think perception. The success of our project depends on our ability to keep relationships flowing. The tools, the software, increase our power. Sometime we take decisions by computer, but those decisions are taken by people. We are not wasting our time talking about this.

Sven: The Danish Broadcasting COmpany has said to the whole project team they are using a group incentive plan -- all or nothing.

Audience: Search for productivity started with cost and led to value. We see now we need to build teams, to be leaders, we are not formally educated to do this. What do we need to do to develop people to do this for us?

John: Your question highlights an important issue in the design industry. There is not an abundance of skills for being a project manager. Perhaps we can learn from construction management programs. It may mean there is a business or project administration function that could develop around leadership.

Roberto: At Berkeley we proposed changes to the curriculum to include leadership. Designers haven't been taught to deal effectively with people. There is a huge lack of leadership in the construction industry.

Anders: We need to go back to the schools to ask for skills for the new process. In Denmark we now have an MBA in COnstruction.

Carlos: We have to be learning new things all the time. The environment in which we work is changing all the time. One of the things we need to learn underlying concepts in production management. People who are very good at learning are making the best use of the LPS.

Sven: We must change the way we measure people's performance. The usual way is about individual contribution to company results. That doesn't support cooperation. We need new measures that support cooperation on the project.

---

13:04 7/21/03

Danish Building Trades Union

Gunde Odgaard, BAT-Kartellet

Premise: Migrant workers, self employment, low wages, poor health and safety throughout the world. Internationalization happens today while workers cross borders and capital is required. Lean construction can benefit everyone. It is one means out of many that can make the work setting better for the construction workers. Lead workers are favorable towards lean.

The trades have overcome the worst working conditions. They see themselves as post-materialistic. It is not about wages and working hours. Agree with the norms today. Can maintain the system in place. Trade unions and employer associations are legitimate in each other's eyes. Not interested in new legislation. Denmark is a special case in the world.

Lean construction is improving health and safety. No indication that wages have changed up or down. Wages are performance based. Trying to promote lean construction and last planner™ both in trade union magazines, in meetings, and in seminars. We are also making way in the vocational training system. The system is a tri-party system among the unions, employers, and government. Setting out to write a textbook for that system.

New skills are required for the trade worker. Cooperation is often called a soft skill. It is needed. Planning is now required of lead men. We see that this system requires people take decisions at the worker level. We need bottom-up approaches not just top-down approaches. Lean construction supports the worker. Must be a stronger effort to communicate. I've chosen only to speak not use other presentation materials. This is to emphasize people in the building trades need to communicate with each other.

The construction worker must be given the necessary authority to take decisions. Decision-making at the top level is not important to the worker. THe problem however is not the top. It is decision-making by the middle. The worst sign of bad management is hiring people that are so stupid that they cannot decide how to perform their own job. The managers of the future will be the one that can bring out the best in their people.

Discussion:

Are you finding that work is being chunked in ways that workers need to be multi-skilled or requiring new skills? The building materials industry is driving many changes. I think we have more than 700,000 registered building materials in Denmark. Some people just install special adhesives. Masons might be more multi-skilled. We shouldn't see one trend eliminating the other. We don't think that multi-skilled workers is the answer. We think teaming specialists in multi-skilled gangs is a wonderful idea.

Why are management access floors requiring skilled labor? Because we are protecting our work.

Successful projects depend on people making and keeping their labor agreements. Is that different in Denmark? We have perhaps the least antagonistic labor relations. Remember the trade unions make the agreements. The individual doesn't make the agreement. It is our task for having the member follow the agreement. What really bears the system is we can probably get away with robbing the employers once, as they can get away with robbing the unions once. But we have learned we must cooperate. We can calm down the most opposition.

We heard from the panel that the need is for the ability to learn, to try new things. Those most opposed to the new are often the experts of the old. How do you face that in your environment? I meet the same problems,. The labor market is changing so rapidly. People must stay up. The must up qualify their skills. Most people, however are opposed to change. We are finding the lead men are positive. They see that it is making their jobs easier. Also health and safety improve. And there is some evidence that they get higher wages. When the leads say, "This is a good idea. We want this." The earlier we bring this to vocational training the better. We also must be persistent. We can't look one rotten egg ruin the whole box.

You say the bottom-up approach is very important. it is the basic theory behind productivity improvement. DO you have any program to train and educate the workers to be ready for taking more responsibilities? We do, but they learn the most when they join a gang that has an accord (agreement). They learn to take responsibility on these autonomous gangs. But this can be a problem because people work for their own interests. With lean construction the gang considers other gangs' work before they proceed with their work. THis is very much about changing behavior. When they don't consider others' work they are saying they don't give a dam. That has to change. We need the basics of knowing your trade and the soft skills of cooperating.

Are you training workers to understand the whole system? We do train them. Sometimes we need to improve this. We heard this morning about IT models. The trades people love the model. It allows them to see what they are doing. They are not just laying brick on brick. They see they are building a cathedral.

You said middle management is the problem. Why? I think middle management feels fear. They see they might be obsolete. Lean is not just changing the way we build. It is also about the organization of the company. We need to find a new role for middle management. The tasks need to be redefined.

In manufacturing middle managers are now facilitators. With lean construction everyone in the value stream will see changes. I agree. Everyone must be willing to take on new responsibilities and competencies. If we don't change we'll continue to attract the people we don't want.

How do you define middle management? I think it is project management. How do you define it. It changes from company to company and country to country. Some places foremen are the leaders. OTher places then lead men supervise. Everyone in between the CEO and the worker is middle management. They all feel squeezed by these concepts. Lower middle management in the auto industry have felt obsolete. We must find them new roles.

Comments:
This union leader is everything we want in leaders. He has carefully considered the views and interests of the union members and is helping them explore and adopt what is in their interests. He was forceful and compelling with his views.

---

Greg Howell: We have seen the unfolding of change move from contractor to owner, to specialty sub, and the supply chain. It is wonderful to see the unions now getting on the bandwagon.

---

14:01 7/21/03

Optimizing the Value Stream

Richard Temblar, Alflx Corporation

Premise: The construction value stream is pretty complex. It is important for the constituents in the process to understand the whole of the value stream so they can bring a perspective on the whole rather than their one part.

Approach:
Use the term value web to describe the construction value process rather than value stream. They partner with contractors to understand their business processes, drivers, and decision processes. The lean contractors are the ones on the cutting edge. They want to extend their own lean manufacturing principles into the construction value web.

Realization that relationships are built on trust. That to be open to new ideas their must be trust. Optimization can only occur with 100% participation of the constituents. Observation is a powerful tool. Just to observe someone else's process reveals learning for us and those we observe.

Why partner? To gain customer insights. Customers want value. They want ease of doing business. And they want suppliers who bring innovation. They've found a more universal insight: customers want what they want when they want it. Companies want allies that can extend what they can do alone. Need to protect labor efficiency. Don't want to be constrained by the distribution system.

Benefits of lean manufacturing: all the usual stuff, stressing innovation + continuous improvement. Presented a lean approach including: 5S, kanban, quick changeover, one-piece flow, jidoka, standard operations, level production, and maintenance and safety. Offered an example of a cable manufacturing that took waste out of Alflex's process and presenting it ready for use for the contractors' installation crews without any prefab on their part.

Discussion:
You mentioned you communicate with contractors. Do you see the opportunity for working with the engineers who are designing the systems? We are just starting. we have learning to do. We see us going there.

To what extent did you find skepticism or distrust as you went out to observe your customers? We are exploring this pretty softly. A lot of contractors are open to new ideas. We're trying to do this by evolution not revolution.

Did you find yourself being an instructor of lean? Yes. Although much of the time they catch on to what we say. One contractor is taking our suggestions on their process.

Are the contractors sharing the increased profits? The contractors are not sharing information about what they are doing. They see this as competitive advantage.

Are the ideas coming from Alflex? Or are the contractors coming to you with ideas? We are partnering with them to find solutions to be more competitive. We look for people who are open.

Have you found that you could now take the lead as a bidder now that you have learned? That's a long road. (laugh)

Comments:
Talking about all the right stuff. They are already enjoying the benefits of lower inventory levels, higher fill rates, and cash flow. They've got to be offering something that other suppliers to the industry are not able to offer.

---

15:21 7/21/03

The Marriage of CPM and Lean Construction

Bob Huber, The Boldt Company
Champion of a failed project management system. Boldt adopted LPS while ignoring CPM. Eventually the two had to come together. Internal customers complained

Premise: Establish a theoretical basis for how the two approaches can work together.

Approach:
Set out to create a perfect planning system without waste by considering:

• CPM as product
• Interactive scheduling
• Soft logic
• Crew-centric planning
• Crew flow matting
• Attention as resource
• Pull intensity

Boldt has a usual history using CPM. They adopted a centralized approach for developing and updating schedules using high priests of CPM scheduling. They had a few copies of P3 for the scheduling department. All others used the less expensive SureTrack. Began to shift to a less distributed approach to scheduling as the software and tools came down in price.

Claim: No longer live in a world of infinite resources.
Formerly, command and control was the prevailing mechanism for planning and executing projects. It won WWII. CPM arose in the time of smart people telling others what to do. It was also the time of union halls having highly competent craftsmen bringing their own tools to the job. The approach

Claim: Database management is fun and ineffective.
Database management allows you to create more information that a person or team can consume. There's no need to use a WBS to scope work. Schedules are not productivity tracking tools.

Claim: Scheduling is a conversation for coordinating work among a group of performers.

Claim: If we do not apply the Lean Ideal to our own systems, we are false prophets. Think that you must push lean thinking into the company as the way to start. It has now shifted to a pull among small groups of people. Go on to say that management has been a nuisance overloading the planning.

Total float measures pull intensity. A reverse path on a CPM schedule is 'pull'.

Beware of sleeping superintendents. Capture promises made in coordinating conversations. Do it in public.

Claim: It doesn't cost the project for work waiting on a project. It costs when crews are waiting on work.

Discussion:

There is a real cost to having work waiting on crews. It is time. Workflow buffering starts to has cost if there is a cost associated with having material onsite not being used.

How do you do reverse phase scheduling with CPM? This is a concession to my boss. Really the schedule grows as the permanent players are joining the project. We do this informally, monitoring the end date and total float.

Why do you update the schedule at all? This is for performance reporting.

I tell my students there isn't a problem with CPM. The problem is how people use it. We go to more detail than we need. That makes it impossible to update. We built a $45 million performing arts center with 349 activities on our CPM schedule.

You cannot schedule until you plan the whole project. I reject the underlying assumption of your comments.

How do you connect the CPM schedule and the LPS. Who does it? What is the overlap? That is in a state of flux. We are training people to get the downstream people to specify requirements on the upstream people.

Comments:
Bob made the case for using the CPM tool for what it is good for. Re planning and examining options.

---

15:41 7/21/03

Three Dragados Projects Benefit from Lean Construction Protocols

Carlos Bosch Cantallops, Dragados, Spain

Premise: Take an integrated collaborative approach from the master plan to the daily plan. Their approach developed independent of the lean construction movement.

Approach:
The company developed their own approach based on the general Japanese lean approach to manufacturing. They start with an intense focus on client value.

They have implemented a comprehensive set of practices from jobsite organization, standard work, pull from the jobsite, collaboration with other contractors and their workers, and a general sensibility to waste. "The main part of our job is thinking."

Discussion:

We're a little stunned.

What are the lean (construction) concepts you are using? We are not using any of them. Although we are taking time out of our processes. We are using pull. All the checking in the Monaco project was in the process rather after construction or commissioning. When we were awarded the project the client didn't know what he was doing...and neither did we. We learned how to do the project as we were designing it. We had flow construction rather than batch construction. We had a reduced number of suppliers. We reduced all the movements on the jobsite including the distances. The most was 20 meters. We cancellate all the non-value adding parts.

You appear to have adopted many lean techniques. How did you come to these ideas? What are the roots? We are very concerned with people. Our management is very keen on bottoms-up planning. We have to be very competitive. We cannot ask for more money from our clients.

Comments:

Take a look at this presentation online. (Should be posted soon.) These folks started from scratch and have created a coherent system that is lean. He claims to be doing lean projects of all types around the world.

---

16:21 7/21/03

Implementing lean COnstruction in a Large Danish COntracting Firm

Mikkel A Thomassen, MT Hojgaard, Denmark

Premise: Lean construction improves performance.

Approach:

Taking a complete Last Planner™ approach: look-ahead schedules, weekly workplans, PPC measurements, attention to flows, and collaborative kick-off seminars. Adopting lean construction as part of the strategy for the entire company. During company restructuring lean construction is one of the things that survived.

One usual complaint is while the results are good, you are applying more resources. It is true. Project management resources are about 2% higher on lean projects.

Not seeing significant differences in customer satisfaction. They are not surprised by this. Only focusing on operations.

Data on profits and piece rates are inconclusive. They show a small positive variation.

Data on working environment is compelling. Absence due to illness is 15% to 71% higher on non lean jobs as compared to lean jobs. Safety incidents is twice on non lean jobs as it is on lean jobs.

Lean construction appears to work for all constituencies. Still need to understand the results better. Why has safety improved so much? We thought piece rates would be higher. Implementation is non trivial. The main barrier they have for lean design is information availability.

Discussion:

Do you have a way of capturing safety savings in the project profits? We haven't included it.

Have you got full implementation of lean practices? No. We have a long way to go. We have some resistance at the two levels above project manager.

How extensive is your implementation? Just on the building site.

Why are you getting the results? How do you define management costs? We believe that when people are planning their own work there is less stress and increased ownership leading to lower absences. We measure the amount of money spent on the building site as a percent of the total.

Have you changed the project manager to be a process manager? So far, we are introducing some new responsibilities, but the other responsibilities remain. Wondering if process management is superior to process management. We hope we have removed some of the activities of project management.

Have you adjusted your workforce as you have been eliminating waste? Companies actually increase capacity. It is difficult to say. We are affected by market variations.

Have you done an evaluation of lean projects? How lean are these projects? Once in awhile we look at what techniques we are using where. We are not fully there.

How do we make comparisons from one company to another? We started by asking our people how satisfied they were working on lean projects. The responses didn't matter based on the extent of the lean implementation.

Do you do kaizen blitzes? You need to explain that. I guess we're not doing it.

Comments:
The analysis of their situation was quite exact and careful. However, I was expecting more conclusive evidence. They are still reluctant to explain their results.

---

Concluding Remarks

Mike Vorster, Professor, Virginia Tech

Discussion:

Let's go back to the roots of this movement. It started with methods improvement in the '70s. Clark Ogilsby brought this community together. This is a journey. The show is on the road. Getting the work done is what this business is about.

Where will this go? I don't know and I suggest you don't. What did I hear today? I heard nothing that is not essential to our future.

• We have to capture our clients' wishes if we are to be successful.
• We have to use the very best technologies to plan work.
• We have to insure that everything we do builds on the dignity of the labor.
• We have to build on the capabilities of our suppliers.
• We have to challenge the sacred cows, including CPM.
• We build great works, better than we did yesterday, but not nearly as good as it needs to be.

I heard nothing. Nothing that is not essential to our environment. The knowledge is good. The application of that knowledge will make us successful. The difference between good companies and great companies has to do with their ability to learn and implement.

I wish you continue your focus on implementation. Lean construction is not an end in itself. Use your time together with some outstanding folk. Enjoy your time in Blacksburg and our beautiful campus. Travel safely and extend our wishes to your friends and family.

---

Greg: Thank you for all the fine work of the presenters. Thank you to Virginia Tech for putting this together for us. The next Introduction to Lean Construction will be in Las Vegas in September. The next research meeting will be on contracting in October.

Glenn: Add my thanks to everyone. This was a wonderful set of presentations. I am impressed with the range and depth of what is going on around the world. And proud top be part of it.