Capital projects are a big deal. Leaders often “bet heavy” on making a capital project work for their business unit and really getting the ROI they promised. Unfortunately, the capital projects industry hasn’t done very well in this regard in the past. Some studies have even shown that more than half of capital projects fail to deliver on schedule, budget or function. There is a better way! However, it will require us to let go of many of the paradigms some of us veterans have held too close for too long. Enter Lean Construction and an important related idea, Integrated Project Delivery (IPD). You have likely heard these words thrown around in industry circles, but may not have had the time to dig in and see what the “hub bub” is all about.
For some time now, the Design-Build Institute (DBIA) and the Lean Construction Institute (LCI) have studied and educated others on these two important topics. These two ideas occasionally overlap each other conceptually. This is because they both require a different mindset from the “owner” and the “team” performing the work. A mindset of integration, rather than “divide and conquer.”
What these organizations have found, is that teams must work toward a common goal as one (“owner” included). For over 100 years our industry has been more likely to chop up a job, contract out responsibility for every little piece to a vendor or sub, then plan on it being “bolted back together” into a whole that really worked. This idea is simple (hence why we like it, because we understand it); however, it lacks performance in the real world. The system has resulted in delays, gaps in integrating work, and budget overruns through waste and claims.
Going back to the common goal – high performing projects. To get these projects, we need to do some very basic things and we need to decide early in the process that we want to deliver it differently. The client’s early decision on what project delivery method to use makes a huge impact to the rest of the project and its results. Being informed to make that choice around your specific needs earlier, will set you up for success
Some key ideas around these early project decisions are:
- Build your team early – prior to/during conceptualization, using a best value selection process
- Support the team with collaborative contracts (IPD creates a pull for lean)
- Establish and communicate your (the owner’s) business case and goals to the team
- Learn as a team to increase adoption of lean methods
Being proactive about selecting a project delivery method and team that is ready for an integrated lean approach is key to delivering your project as promised.
Want to learn more on this topic? Below you’ll find some great resources!
- The research is in: A Lean team is an “A”-team!
- Why Projects Excel – Great Design Enabled by Lean
- Study Shows Importance of Team Integration
Dave Crumrine, Interstates Construction President