Lean Processes that Drive Results

People commit to Lean because it promises results; organizations sustain that commitment. There is no Lean without Lean results: reduced waste; focused value, and streamlined flow. For those designing and constructing capital projects – there is no Lean without Project Delivery results: increased profit, increased client satisfaction, and increased speed.

Core Processes + Project Hierarchy of Needs

Projects, like people, have needs. With apologies to Maslow, these needs form a hierarchy that is broadly based on the client’s value proposition and culminates in their ability to make decisions that stick.

Meeting these needs has been essential to project delivery for as long as there have been projects. What’s new is the existence of 5 Lean Processes that deliver results. These form the strategic core of Lean Project Delivery. Using any single one of these processes will gradually improve project results. But it is their integrated use as a hierarchy of processes that is transforming project delivery.

Conditions of Satisfaction | Value Proposition

Project teams routinely engage clients in goal setting. This is a distinct expertise encompassing areas such as workplace strategy and space programming. In Lean Project Delivery, we use the Conditions of Satisfaction (CoS) to document stakeholder expectations for both the project’s end result (a new environment) and the process by which it is achieved.

Every project, as defined by Peter Barrett, “…is a means to a means to an end”. That end is always the Owner’s creation of value. Capital projects are undertaken because a business plan has demonstrated the project to be the Owner’s best way toward creating new and increased value. Lean practitioners are advised to move from the older terminology of “goal setting” toward “value proposition” as a more accurate description of what the Conditions of Satisfaction must define.

Last Planner System™ | Scheduling

Once the Conditions of Satisfaction are established, nothing is so important as scheduling. When we talk about coordination among design disciplines and construction trades, we are talking about the flow of hand-offs, occurring in time. Often referred to (incorrectly) as Pull-Planning, use of the Last Planner System™ is more than interactive scheduling with sticky-notes. At heart, it is a process to achieve reliable promising; in other words, achieving results.

In mentoring project managers, I’ve often quoted my first rule, “Nobody ever made money by delivering late.” Research by Dodge Analytics and the Lean Construction Institute finds that – when compared to projects that do not use Lean – the Last Planner System™ (LPS) is the critical process enabling projects to be more three times as likely to be on or ahead of schedule. The process unfolds in five, iterative steps:

Should   Milestone expectations that must be met on time
Can   Pull-Planning that builds a mutually-agreed process for project activities
Will   Rolling lookahead schedules detailing what is promised to be done
Did   Measuring actual performance and broadcasting results
Learn   Analyzing trends and making improvements

Target Value Delivery | Budgeting

Every project has its budget limit. In traditional project delivery, budgets are viewed exclusively as a cost-reduction problem. In Lean, the problem is approached, as it were, ‘from the other side’. The budget is viewed as an exercise in value creation. While getting more bang-for-the-buck (value) may appear similar to cost avoidance, they are quite different. Target Value Delivery (TVD) uses a ‘forcing function’, setting the project’s allowable cost significantly below estimated market value. This stretch goal can only result when a team is making holistic decisions that incorporate the true needs of owners with innovative design solutions, grounded in constructability.

Using TVD changes how teams work. For example, detailed cost estimates delivered at milestones cannot deliver significant cost reductions. Rather, a process of continuous estimating is used, wherein parametric estimates providing just-enough detail guide owner, designer and constructor in selecting optimum design solutions.

Set Based Design | Problem Solving

Design solutions are developed in Set Based Design (SBD). This is a method of developing alternative concepts in tandem with parametric estimating. SBD has been commonly used by developers to explore options while working toward a decision deadline at the last responsible moment. A design ‘set’ is the range of conceptual alternates that meet the Conditions of Satisfaction, albeit in different ways. For example, a standard requirement in commercial development is to build all the available floor area allowed by the zoning ‘envelope’ (spatial constraints of height, setbacks and property lines). A valid set of alternates could include solutions that range from tall + narrow to short + broad.

Choosing By Advantages | Decision Making

My second rule, borne out by decades of client engagement, is that “Projects move at the speed of client decision making.” I’ve guided clients toward decisions that stick, using a variety of technique. Choosing By Advantages (CBA) is far and away the best. CBA addresses both qualitative and quantitative aspects of a decision. While rationality may serve as the framework for good decisions, it is impossible to make decisions that stick by ignoring their emotional content. The creator of Choosing By Advantages, Jim Suhr, has summarized this as follows, “Decisions must be based on the importance of advantages.” Judging the importance and advantages available in a range of options requires ‘both sides of the brain’. The CBA process can deliver ‘bullet-proof’ decisions that withstand second-guessing and keep projects on-track.

Lean without results is like design without construction; merely an illustration of what could be. Honor your Lean commitment by delivering the result that matters: greater reliability in cost, schedule and value performance.

To learn more about Lean processes that drives results, please watch our recorded webinar.

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