Process Management Methods for Construction Performance

Process Management Methods for Construction Performance ABSTRACT The purpose of this research was to study how the construction performance can be improved by adopting the process management approaches, in order to provide better client value and more cost-efficient production. The research focused on the manufacturing process , and referring point, and transfer this process thinking into the construction. The methods were tested in pilot tests in which the developed cost and value engineering prototype application was used. This thesis demonstrates an integration of design and production planning based on the product model approach. The final outcome is that the main contractor can utilise information coming from designers as input in its own tendering and cost estimation applications. The key methodology used for describing the information management process throughout the building process life-cycle was IDEF0. The analysis of the current process (as-is), in the form of an IDEF0 model, helped in identifying the main problems of current practice. The target process (to-be) definition was based on product model utilisation and takes into account the possibilities for process reengineering supported by product data technology. One specific requirement was deemed important in view of the anticipated developments in thearea of data exchange; the target system should be structured in such a way that it could easily be adapted to receive data according to the emerging IFC core model schemas. The overall result of the research reported in this thesis is that the product model approach can be used for a substantially reengineered information management process of a main contractor, especially in design and construct type contracts CHAPTER ONE: INTRODUCTION RESEARCH BACKGROUND The construction industry is suffering from its fragmented nature ¼Ã‹â€ European Commission, 1994 ¼Ã¢â‚¬ °. The lack of co-ordination and communication between parties, the informal and unstructured learning process, adversarial contractual relationships and the lack of customer focus are what inhibit the performance of the industry (Latham, 1994; Egan, 1998). Because the construction project is regarded as unpredictable in terms of delivery time, cost, profitability and quality, the industry has not been able to combine high quality with productivity, customer satisfaction and flexibility (Fairclough, 2002). Howell (1999) pointed out that the ‘inefficiency’ of the industry has tended to be the way of life. However, Latham (1994) suggests using the manufacturing as a referencing point and transferring the practices and theories from manufacturing industry. And Howell suggests that the learning from manufacturing could be a two way process: manufacturing could learn from construction in areas such as project-based management; and construction could learn from manufacturing’s developed and developing solutions to improve competitiveness. In manufacturers are accustomed to taking a process view of their operations, and they usually model both discrete product activities and holistic high-level process both internal and external activities. Base upon this, Egan (1998) recommends that process modelling could be used as a method to improve the construction performance. Furthermore, many other models derived from manufacturing and process management theories have been recognized and adopted by construction companies Nevertheless, as Ball (1988) summarised, construction industry has distinctive characteristics differentiating from other sectors as well as manufacturing. Although solutions have been recommended, their implementation in manufacturing is far advanced in comparison to construction industry. Thus to what extent these process management approaches and models can improve the design and construction process will need to be examined. RESEARCH AIM The aim of the research is to understand construction process management and to prove it as an approach that could help to improve the construction performance. In order to achieve the aim, specific objectives were set PROJECT OBJECTIVES The research project objectives are outlined below l To explore the readiness of construction to embrace the process approach to deliver project l to identify the present state of process management in construction l To Study the current trends and developments of construction process management METHODOLOGY AND APPROACH The starting point of this research is exploring the construction process management approach and find out its influence on construction productivity and competitiveness. A cross-section research method is adopted in the collection and analysing of the data and presentation of the findings. To obtain comprehensive understanding of the relationship between manufacturing process and construction process, as well as theories on construction process management, a great quantity of books and documents need to be looked through. Then the implementation of process management in construction is inspected by adoption of the case study qualitative research approach. REPORT STRUCTURE The general instruction and structure of the report will be provided in this section. The report is organized to consist of six main chapters. A brief description of the content of each chapter is outlined below Chapter one In this chapter, the research report is introduced. The research background is addressed. The aim and objectives are also presented. Chapter two Chapter two reviews the existing literature. A wide-ranging literature review was carried out to identify the current knowledge and keep up on any development on the field. The literature review covers the understanding of manufacturing process, construction industry situation and problems within it, process management theory, and the implementation of construction process management approach. Chapter Three In this chapter, an overall outline of various research methods that might applied in this research is presented. The selection and justification of the research methods are described. The chosen methods and research plan are highlighted in this chapter. Chapter Four This chapter examines the collected data and analyzes the data within cases, as well as a detailed cross-case analysis of cases. Chapter Five This chapter is directly linked to the chapter four. An in-depth discussion is held based upon the previous analysis and research. Chapter Six This chapter provides the conclusion of the report as well as the recommendation. The direction of further research is also proposed SUMMARY CHAPTER TWO: LITERATURE REVIEW Introduction Over the past few years, researchers and sponsors have increasingly turned their attentions to finding ways managing the construction process. After decades of neglect, construction process is high on the agenda. As the construction product has in most instances been a ‘one-off’, much emphasis has been placed on project management. However actually the industry is focused on design and development of a building product and should look to manufacturing reference on how to manage the design and development process. Examining the manufacturing perspective and understanding how it can be applied to design and construction and considering the use of techniques and technologies available to support the process and the issues relating to the implementation on projects is essential for construction industry . However, whether this process approach is needed in the construction field, and to what extent it contributes to the construction industry, this required to be researched a nd evaluated. Therefore in this project, why there should be process management in construction industry, the state-of-the-art, how it is applied and the future of it will be identified. Being continuously criticized for its less than optimal performance by several government and institutional reports such as Philips(1950) and Latham(1994), The UK construction industry has been under increasing pressure to improve its practices(Howell, 1999). From the analysis of these reports, conclusion coming up that the fragmented nature of the industry, the lack of co-ordination and communication between parties the informal and unstructured learning process, adversarial contractual relationships and the lack of customer focus are widely and typically existing in the construction industry and are supposed to embarrass the industry’s performance. Furthermore, Fairclough(2002) indicates that construction are often seen as unpredictable in terms of delivery time, cost, profitability and quality, and the investment into research and development is usually seen as expensive when compared to other industry. According to Howell, the â€Å"inefficiency† of the industry has tended to be the way of life. This may be due to the fact that none of the reports, apart from Latham (1994) and Egan (1998), has been sufficiently acted upon. So Lutham suggests using manufacturing as a reference point and Egan, in his Rethinking Construction report, recommends process modelling as a method of improvement. There has been a constant subject of discussion on the transfer of the transfer of practices and theories from other sectors as Lutham (1994) suggested in his report. Some construction practitioners are obstinate that their industry is unique and that the transference of principles cannot be adopted wholeheartedly. Due to it, Ball (1998) emphasized some of the arguments most commonly used to differentiate construction from other industries: The one-of-a-kind product. The spatial fixity of buildings. One-site production. The effect of land price on design and construction possibilities. The requirement for long life expectancy. The inexperience of clients The merchant role of company. The overwhelmingly domestic industry. The masculine stereotype of the workforce. The long cycle from design to production. The high cost of the projects. The amplified reaction to economic crisis. The labour intensive production The fragmented nature of the industry. Nevertheless, there are also many practitioners and academics who believe that the construction industry has much to learn from other industries typically manufacturing. Howell (1999) goes so far as to suggest that this learning could be a two way process: manufacturing could learn from construction in area such as project-based management; and construction could learn from manufacturing’s developed and developing solutions, to improve its performance of competitiveness and productivity. As stated by Love ¼Ã¢â‚¬  Gunasekaran (1996) and Korenlius ¼Ã¢â‚¬  Wamelink (1998), manufacturing has been a constant reference point and a source of innovation in construction for many decades. Solutions that have been recommended to help overcome the problems of construction include industrialization, computer-integrated construction, robotics and automated construction. However their implementation in manufacturing is far advanced in comparison to the construction industry. Koskela (1992) believes that the fundamental theories and principles of manufacturing should be harnessed to deliver the full benefits to construction rather than the ‘technological solutions’. In recent years the realization that the construction industry might not be as unique as was traditionally thought has initiated new research, which In particularly, has resulted in a development of the concept that construction is a manufacturing process. Moreover a research fund under the Innovative Manufacturing Initiative (IMI) sector of the Engineering and Physical Science Research Council (EPSRC, 1998) to continue and expound upon current thinking. a new phenomenon currently appears to being steadily exploited within construction companies at the side of the new technologies taken from manufacturing. It is based upon the development and use of fundamental core processes to improve efficiency of the industry, with great emphasis upon the basic theories and principles underlying the design and construction process. Egan(1998) draw attention to this factor by reporting that due to the fragmented nature of the construction industry very little work had gone into process modelling. Manufacturers are in the habit of taking a process view of their operations; they usually model both discrete product activities and holistic high-level for both internal and external activities. In particular, there has be a growing volume of research focusing upon the consolidation of the just-in-time(JIT) and the total quality management(TQM) theories, with an array of other practices such as productive maintenance, visual management and re-engineering . Investigations by construction practitioners and academics alike have now sought to develop the content and manufacturing, agile production and lean production. Current Researches on Construction Industry The Civil Engineering Research Foundation (CERT) Report observes that the construction industry is becoming frustrated over the lack of progress in removing or mitigating barriers to improving construction practices and is necessary to support sustainable development goals. the industry has to face Many difficulties as it approach this goal: facilities are designed by using least-cost technologies that ignore opportunities to improve productivity and enhance environmental quality; it seems to be complicated, to achieve agreement on government design and construction policies that advance sustainable development; what’s more, there are the frustration of knowing better technologies are available but not having the capacity o find and retrieve them; and international concentration on construction research and practice is far more inadequate. Also the report identifies specific constraints to innovation that characterize the challenges facing the construction industry which repre sent the areas where work needs to be done. The observers indicate that the design and construction process often discourage the introduction of innovative technologies and systems that have superior characteristics but are not necessarily the least-cost option, which can work to the detriment of owners and the environment; unsuitable building codes and disjointed regulatory systems that does not allow for adopting new and better materials and practices are often be applied when buildings and facilities are designed and constructed. There is a lack of understanding by the public and by industry of practices and opportunities to promote sustainable development; there is lack of timely and accurate information and a knowledge base on proven design and construction solutions and techniques for assuring quality construction, which results in lost opportunities to improve system efficiencies and productivity through adoption of innovative technologies; there are no consistent, accurate, and comprehensive predictive models available for designing for sustainability making the process difficult to validate, monitor, and evaluate. Therefore, the observers suggest, new tools and methods are required for advancing state-of-the-art technologies, including taking advantage of advances in information systems to increase the construction industry’s efficiency and productivity. According to Kraiem Diekman’s (1987) theory delays of project are classified into three groups: compensable, excusable and non-excusable. Generally, a delay is considered compensable to the contractor when its cause is within the control, is the fault of or is caused by the negligence of the owner. Excusable delays occur when the contractor is delayed by occurrences that are not attributable to either the contractor or owner. Non-excusable delays are caused by the contractors own action and/or inaction. These can be caused by the fault of the contractor, or his subcontractors, material, workforce or suppliers. The delay damages from the contractor is regarded could be retrieved by the owner conceivably. Lieshmann (1991) presented the consequences of delays in construction, especially from the legal point of view. Herbsman et al. (1995) catalogued the influence of delays on time, cost and quality. Baldwin Manthei (1971) studied the causes of delay in building projects in the USA. The major causes of delay were the result of weather, labour supply and subcontractors. These authors found that adequate planning at the very early stages of the project is important for minimizing delay and cost overruns in most projects in developing countries. This study dealt with developing countries where workers are relatively skilled. The authors realised that some of these problems relate to the special characteristics of this part of the world, such as productivity, whereas others are inherent in the nature of construction projects, such as planning and control problems. Yates (1993) developed a decision support system for construction delay analysis called the delay analysis system (DAS). The main categories of delays in the DAS system include engineering, equipment, external delays, labour, management, materials, owner, subcontractor and weather. Assaf et al. (1995) studied the causes of delay in large building construction projects in Saudi Arabia. Some of the mos t important causes of delay included approval of shop drawings, delays in contractors payment by owners, design changes by owners, cash problems during construction, the relationships between different subcontractors schedules in the execution of the project, the slowness of the owners decision-making process, design errors, excessive bureaucracy in project-owner organization, labour shortages and inadequate labour skills. From analysing the factors causing the delay of project, there should be elicitation on whether it can be diminished by application of process management. Atkin, BorgbrantJosephson (2003) argues that ideas of what should be considered in the design stage of a new building often seems to be a headache for architects, engineers and clients. These ideas invariably lead to some compromise between the demands of hard engineering and softer issues, with the potential likewise to compromise on the physical characteristics and performance of the building leading to some measure of failure. Examples of failure include high energy costs, health problems and structural destruction because of moisture, for which the occupant must pay directly or indirectly. Long-term socio-economic consequences can occur from this as well. Current problems are failures resulting from neglect of building physics principles are examined and their causes are highlighted. Research is continuing into the development of tools to help reduce the risk of failure and to highlight the costs and risks attached to the insufficient attention to building physics principles. Theories on Manufacturing Process and Process Management According to Melan’s(1992) research, a well- managed manufacturing process has the following characteristics: 1. Clearly defined ownership. Traditionally, ownership of a manufacturing operation is generally clear and explicit; it resides with a manager. The manager responsible for the operation is readily identifiable. The organization objectives, its output, and what the manager is accountable for must be fully understood. Standards such as cost, schedule, and quality are established for judging the manager’s performance. However, in recent years, authorized work teams and self-directed work groups where employees are assuming some of the tradition roles of management have gradually take the place of the traditional management ownership. A process owner, whether an individual or a team, is fully responsible for yield, cost, quality, and schedule, and must management the process to the targets set on these standards. Further, an owner has the authority to change or oversee a change in the process within his or her area of jurisdiction. 2. Defined boundaries. Manufacturing processes have a clearly defined beginning and end. He final output, or deliverable, as well as the input required to create it are clear and unambiguous. What is sometimes not clear, however, is whether output specifications truly reflect customer requirements and whether input specifications represent what is needed in the ensuring transformations. The lack of understanding of requirements on either the input side or output side underlies many business processes. In a well-managed manufacturing process, requirements problems are minimized through conscious effort aimed at specifying the work product as it proceeds from one operation to another. 3. Documented flow of work. Work flow in a manufacturing process is generally documented in great detail. There are several reasons for this. Documentation provides a permanent record of the manner in which a physical transformation takes place for production purposes. This record also provides a reference point or baseline from which any changes are to be made and serves as a means for replicating the process. Finally, documentation also serves as both a training and reference aid for the personnel involved in the process. 4. Established control points. Control points serve as a means for regulating the quality of work. Because of the natural variation that occurs in physical process, control points are established to manage variation. These points involve such activities as inspection, verification of required characteristics, and the disposition of discrepant material. 5. Established measurements. Measurements provide a statistical basis for controlling the flow of work and managing variation. Statistical techniques such as the control chart serve as useful tools for managing variation in many operations of a repetitive nature. 6. Control of process deviations. In managed processed, corrective action is performed in a timely manner and from a statistical basis when an undesirable variation occurs. Feedback and regulation are the heart of process control and, without control, the process loses its capacity of providing consistent output quality. Anderson’s (1994) theory clearly introduces the manufacturing process. He states that the most obvious characteristics of a production facility are the volume of items produced and the variety of different products made using the same resources. The volume and variety characteristics provide one way to look at the process of manufacture. Usually an increasing volume of production, in term of the number of individual units of each product, will go hand in hand with decreasing variety, in terms of the number of different products. And the author classifies the manufacturing process into three types: Mass Production involves producing a small number of different products in a great quantity, which provides the stereotype of manufacturing industry: long assembly lines where men or machines endlessly turn on the same product month after month. One characteristic of a mass production process is that operations are linked together in a line: when one operation is finished on a produc t it moves directly to the next operation; Batch Production is used when there are a greater variety of products being produced, with correspondingly smaller volumes. In this situation it is usual to have machinery and equipment which can be used to carry out operations on a number of different products. A single machine will carry out an operation on a whole batch of items of one kind and then be set up to carry out a similar operation on a whole batch of items of another kind; One-off production is used when individual customers each require an individual product, which is different from any product the company has made in the recent past. This implies low volumes but the greatest possible variety. With very large and complicated items the manufacturing process may be project based. This indicates that the manufacturing processes sufficiently complex, and over a long enough time-scale, that the major difficulties are associated with planning how various different operations and ac tivities will fit together. Born (1994) has provided a systematic method for integrating process management with quality management. It is based on a notion called the Quality Process Language (QPL), which is capable of representing and analysing all process within an organization. It also provides a basis for quality management approaches, such as ownership of processes, improved communication and compliance with requirements and regulations. QPL has been used in many types of organisation, large and small, highly structured and loosely structured. It provides a foundation for practical approaches such as facilitated workshops, process mapping and improvement, and documentation of procedures. The author also point out that activities and roles inputs and results of any organization can be well represented if the nation of QPL is mastered and then this notion can be converted into ordinary text and flow charts, for use in procedure and other documentation about the organization. The use of QPL as author states provides a common language for process and quality specialists to communicate directly. This offers an opportunity to discuss and design organizational and process changes without ignoring the effect on quality. QPL is a diagrammatic language, and it makes it easier for non-quality specialists to understand how processes affect quality and vice versa. Process Management in Construction Report (Kagioglou, Cooper, AouadSexton, 2000) introduces the findings and recommendation on the process management relate to the state of the construction industry at the present time and recommend some solutions as t in respect of how some of the problems might be overcome by transferring established practices from the manufacturing industry. However, the authors deem that it must be very careful when transferring knowledge and practices from manufacturing into the construction industry due to a number of reasons. First, the differences between the level of maturity of both processes and practices are distinct, with manufacturing having the lead. Second, because construction depends heavily on Temporary Multi-organizations (TMOs) while long-term partnership arrangements normally play the operation role in the manufacturing industry, the structure of the industries and of the organization of project personnel is dissimilar. Finally, comparison between the processes and the practices of both industries must be made by considering the levels in which they exist, such as strategic, managerial and operational. Therefore, clarification of process levels can have an important influence on the management of those processes. Kagioglou (1998) argues that there are two chief perspectives of manufacturing that construction can benefit from: the project process or New Product Development (NPD) and the operational and production processes. The first relates very closely, both in terms of nature and content, to the design and construction process. For itself, the development that of a solution from a demand identified in the market place or internally within an organization to the implementation is considered. This is achieved by organizing the activities that need to take place in a number of phases, which are made distinct by the determination of review points between the phases. This is very similar to the enactment of a construction project, the difference being that the distinction between the phases is usually determined by the entry of the different parties or functions, for example, architects, contractors, to the process. The second area is related to the way in which the production of a product, incl uding material flow, process design and resources planning, is undertaken. Indeed, a number of very effective philosophies and practices such as Just in Time (JIT), lean production and others have a legacy of optimized production in the manufacturing sector. JIT aims to improve production by utilizing the internal and external supply chains in terms of people and material flow. The first two benefits can be realized in the construction industry perhaps more readily than the third one, which requires a significant reorganization and mind-shift of the litigation-driven industry. This investigation concentrates on what can be absorbed from the NPD project process of manufacturing, and reference to it is made throughout the description of the Generic Design and Construction Process Protocol (GDCPP). Koskela (1992) expresses in his report that currently some construction subproducts are produced in processes that possess a manufacturing character. The assembly of such components with the building frame usually represents a minor share of the total costs. Windows, doors, elevators, prefabricated concrete components, and prefabricated houses, are examples of this kind of manufactured product. In regard to quality management, clear progress has been made in many countries. Many supplying firms have acquired quality certification according to the ISO standard. The application of the new production philosophy is least problematic in this part of the construction industry: the methods and techniques developed in manufacturing can be applied directly. However, except for quality management techniques, only a minor fraction of the factories and plants delivering to construction sites have begun to implement the new philosophy. It may be anticipated that this transformation will proceed r apidly after having gained initial momentum. Thus, industrialized construction might gain competitive benefits sooner than site construction. Additionally, Koskela (1992) summarized the condition of Implementation of process improvement by engineering and construction organizations. The inherent recommendation of the new philosophy to construction practitioners is clear that the share of non value-adding activities in all processes has to be systematically and persistently decreased. Increasing the efficiency of value-adding activities has to be continued in parallel. Construction should adopt the new production philosophy. In manufacturing, the new production philosophy improves competitiveness by identifying and eliminating waste (non value-adding) activities. Traditionally, construction is viewed and modelled only as a series of conversion (value-adding) activities. For example, waste activities such as waiting, storing inventory, moving material, and inspection are not generally modelled by Critical Path Models (CPM) or other control tools. Construction has traditionally tried to improve competitiveness by making conve rsions incrementally more efficient. But judging from the manufacturing experience, construction could realize dramatic improvements simply by identifying and eliminating non conversion (non value-adding) activities. In other words, actual construction should be viewed as flow processes (consisting of both waste and conversion activities), not just conversion processes. As demonstrated previously by the manufacturing industrys experience, adoption of the new production philosophy will be a fundamental paradigm shift for the construction industry. The implications of this for design are that the process of construction must be developed in conjunction with the design itself. An initial set of design and improvement principles for flow processes are presented that can serve as an implementation guideline. Major development efforts in construction, like industrialization, computer integrated construction and construction automation has to be redefined to acknowledge the need to balance flow improvement and conversion improvement. The conceptual foundation of construction management and engineering, being based on the concept of conversion only, is obsolete. Formalization of the scientific foundations of construction management and engineering should be a primary long term task fo