Understanding when a construction firm can benefit from a new management technique could mean the difference between continued growth and a slow decline. Implementing modern lean construction techniques and methodologies is a smart way to reduce risk and improve overall efficiency. While it may require an initial investment into new lean construction technology and training to make it successful, it will pay off in the long-term.
Some firms are in the perfect stage for embracing a whole new approach to the construction workflow, but how can they know for sure? There are surefire indicators that it’s time to try something new and go lean–we’ve listed eight of them, below.
Need to know more about lean construction in general before deciding if it’s right for the construction firm? Download our free and informative ebook, “Leveraging Technology for Lean Construction,” to dive into the topic and explore the ins and outs of the lean construction philosophy.
But first, let’s take a look at the signs you need lean construction technology.
1. Excessive Rework Rates
After an extensive review of existing research, Navigant Construction Forum found an average rework cost of just over 4% per project. That means, on a $500,000 project, that can result in a loss of $20,000 or more.
If your firm is measuring higher rework rates than this, it’s definitely time to invest in lean construction methods for reducing mistakes and last-minute change requests. Since lean management emphasizes pull planning techniques rather than reactive methods, rework is prevented by addressing problems when they first arise.
2. Multiple Concurrent Projects
Managing multiple projects at once is an essential skill for growing from a small- or medium-scale construction company into a large firm that can compete on an international level. Taking on multiple commercial or infrastructure projects without the right management system can result in major failures that could sink an entire business.
Implementing lean construction technology and methods prior to expanding into concurrent project management is ideal. However, even a late implementation is better than waiting until a project has failed to try to catch up.
3. Large-Scale Contracts
In addition to managing more than one project at a time, lean construction is also indispensable in megaprojects. Many construction firms gear up to take on multimillion-dollar infrastructure projects hoping to turn a healthy profit, but these projects often offer some of the smallest margins of all commercial work.
Lean construction technology and management is essential to keeping these huge and complex projects on time and under budget so they don’t eat into a company’s other responsibilities. The extended cycles of large-scale projects also provide more opportunities for completing the final stages of lean construction methods which tend to focus on continuous improvement. Smaller construction projects often wrap up by the time teams find the right rhythm, but investing in workflow management pays off on the long-scale projects.
4. Client Requests
How many are change orders and other claims affecting each construction project? Once the number climbs in the dozens, rather than just the handful, project managers will become tied up with this kind of revision work alone. Lean construction technology is ideal for tracking and addressing client requests so that none of them go unaddressed. Missing essential client requests during the first round of revisions is a major cause of costly late rework, so techniques that keep track of requests are well worth the investment.
5. Wasting Skilled Labor
Each hour a project engineer or manager spends searching for the right documents, organizing jobsite photos or other non-essential planning tasks represents a loss of labor costs. Unfortunately, the average manager spends 35% or more of their time on these kinds of administrative tasks. That’s more than a dozen hours a week and nearly 50 hours a month just for tasks that could be largely automated by using the right construction technology.
If lean construction is all about eliminating waste, tightening up construction administrative processes is clearly a priority.
6. Rising Accident Rates
Workplace accidents don’t just remove some of your most skilled workers from the labor force, they also introduce lengthy delays that can sink a project’s profit margins. Any time accident rates start to rise despite ongoing efforts to meet the latest safety requirements, it’s clearly time for a top-down approach to reorganization.
Lean construction places a strong focus on respect for the individual workers serving the company, so it’s a great fit for improving safety records and reducing accident numbers in a hurry.
7. Extra Inventory
Construction companies may handle a lot of raw materials in the process of creating new structures and renovating old ones, but those materials should be used up as soon as possible to reduce storage costs. Dealing with the unexpected and extra inventory of building materials leads to waste, especially if natural conditions ruin otherwise brand-new materials while waiting for another use for them. Even extra machinery increases maintenance and storage costs, yet liquidating needed tools results in extra rental costs.
Use lean construction technology and methods to develop a better inventory holding and on-demand ordering system to eliminate these inventory issues permanently.
8. Delayed Subcontractors
Do projects keep stretching out beyond the initial time frames due to delays in the arrival of subcontractors? Wrapping up the electrical, plumbing, HVAC and other systems in the building require a system that coordinates the efforts of dozens of different workers all at once.
Manual planning techniques just can’t keep up with automated lean construction technology like pull planning software that helps the project manager determine who to have on the site on any given day. Subcontractor teams can be scheduled right down to the hour so they’re on hand as soon as it’s time to complete their part of the work. Don’t put off the finishing touches for days or even weeks due to scheduling conflicts when lean construction techniques are already available to streamline the planning process.
Looking for the Top Lean Construction Technology? Download Our Ebook
Embrace these lean construction concepts with the help of construction technology tools like PlanGrid. Read up on these tools, techniques and more by downloading the “Leveraging Technology for Lean Construction” ebook.
Don’t wait until these signs of struggle are indicating an issue with your construction firm’s growth. Embrace lean construction as early as possible, along with the help of technology like PlanGrid, to stay on the cutting edge.