Adapting the Principles of Lean Business Management to Construction

Colorado Department of Transportation – Business Center

January 13, 2016

The Neenan Company’s Practical Application of Lean for CDOT’s New Region 4

Evidence from research indicates that conceptual models of construction management often fail to delivery projects on time, within budget, and with high quality. The mismatch between these models and reality highlights the need for a theory of production in construction. But, designing a production system to achieve the best outcome is only possible through the collaboration of all project participants. Therefore, the Lean Construction Institute (LCI) has translated the principles of Lean business management to the design and construction industry. When building CDOT’s Region 4 complex, the goal for Neenan Company was to use Lean principles to avoid “average outcomes” that arise from a traditional design and construction process.

The Neenan Company is a Colorado design-builder that recently completed CDOT Region 4’s new Headquarters complex in Greeley, and is now under contract for Region 2’s new HQ facility in Pueblo. By focusing on “disruptive” (beyond average) outcomes, Neenan uses a process that is disruptive to the traditional construction industry, including the practice of combining design with construction planning. The result is Lean and beneficial to CDOT, as evidenced by LCI’s five principles:

Lean Principle One: The customer defines value
Learn what is important to your client by asking questions, then allowing them to prioritize. The result is a “Conditions of Satisfaction” list that is used to guide the team in project decisions to create the right outcomes for your unique client. CDOT’s Region 4 leadership team wanted a 21st Century workspace to attract and retain employees. The result is an office building with contemplative and collaborative spaces that will be LEED (“Leadership in Energy & Environmental Design”) Certified.

Value decisions are also made based on Conditions of Satisfaction for other facilities that Neenan has designed and built for CDOT using “Lean Construction” principles, including the Twin Rivers Maintenance Facility in Platteville, Colorado. For example, for that facility, $26,000 was saved by eliminating paint from columns which had already been primed by the manufacturer.

Lean Principle Two: Map to find waste
Using a “Collaborative Design Process” — which is basically a “boot camp” to launch a project — the CDOT Region 4 HQ team worked on big picture concepts over a few hours rather than months. Then, CDOT’s New Building Initiative Team saw the project through move-in with regular design reviews. The central interchange in the R4 Headquarters where people can meet, brainstorm, and build culture was created from the original outdoor courtyard space as a result of this process.

In the 1980’s, Neenan began to see waste and poor client outcome in their construction process. It was this realization that shifted Neenan from a being just a “contractor” to an integrated design-builder — with architects, interior designers, preconstruction estimators, project managers, and superintendents under one roof. This approach allows the Neenan team to be the single source of responsibility for a specific project, like the R4 HQ, while working more efficiently and less litigiously.

Lean Principle Three: Ensure Good Flow
For the Region 4 facility, existing CDOT operations were maintained while construction was Good information flow is critical. Everyone on team – CDOT, Neenan, and subcontractors – have constant access to the latest drawings and specifications from any computer or tablet. This allows CDOT project managers to provide feedback and saves information transfer time and printing costs.

Lean Principle Four: Use Pull
Working from the end date backwards, the project is divided into big milestones. With Neenan’s use of the integrated design-build process, these key milestones can overlap to shorten a schedule and allow 028_CDOT_ScoutAtrium_8585more time for owner decisions. To ensure that all design preparation is ready and materials are on-site when needed, Neenan uses a weekly work plan to hold team members accountable. For instance, on CDOT’s Twin Rivers Maintenance Facility, the metal building supplier was involved in planning to make sure the schedule was met and make-ready needs were complete.

Lean Principle Five: Practice Continuous improvement
One of CDOT’s six core values is “Excellence”: We are leaders and problem solvers, continuously improving our products and services. This is also a key principle for Lean Construction, and was directly applied for the facilities built in Region 4. Nennan completed CDOT’s Twin Rivers Maintenance facility first before tackling the Region 4 HQ facility. From the Twin Rivers experience, Neenan learned a lot, and improved what it did. For instance, from Twin Rivers, Neenan learned about CDOT’s specific desire to increase the reinforcement of concrete beyond what Neenan typically does. This “lesson learned” was transferred directly to the Region 4 HQ design, and will also be included in the design for the new Region 2 Headquarters facility.

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