LEAN CONSTRUCTION Efficient, client centric business approach can increase profits and reduce costs Canadian Design and Construction Report staff writer Can you bulk up your profits by introducing lean busi- ness practices for your construction business? Consultants and trainers associated with the Leading Edge Group and the Ontario General Contractors Associa- tion (OGCA) believe most general contractors would achieve much better results with “lean thinking.” John Whelton, the Leading Edge Group’s vice president of North American operations, says a general contractor with 20 employees, investing $25,000 in training and con- sulting, could expect to achieve savings of $250,000 or more within a year or two. These numbers are based on Lean’s holistic approach to improving operational efficiency and collaboration. To earn the “Green Belt” designation, for example, the candi- date must deliver an improvement project that can gener- ate at least $50,000 in economic advantages – and it would make sense for a successful contractor to provide training for five employees to reach this level; resulting in the quar- ter of a million dollars in savings. In fact, Garry Doyle, a Lean Construction consultant and trainer at Leading Edge Group, says there is evidence that some lean projects have enhanced construction efficiency by about 20 per cent in California. “They are cutting 20 per cent off of the cost and 20 per cent of the time in some cases,” he said. “The results depend on the level in which Lean is applied and in what form.” How do lean contractors achieve these results? Doyle says the best results occur when the entire proj- ect – involving designers, the GC and sub trades as well as the owner – are collaboratively engaged in the Inte- grated Project Delivery (IPD) model. The practice within the industry is that “a whole lot of different companies are doing things in silo to the same end but are not working in conjunction with each other,” he said. “In the lean view, IPD is an environment of con- tractual collaboration. Everyone is tied to the contract and its risk and reward, including the main suppliers and sub- contractors. Everyone has skin in the game. Everyone has an interest. And all the savings are shared.” This is good, but can lean help general contractors com- peting for traditional fixed bid contracts where collabora- tion often needs to be defined after the contract is awarded, and cannot be totally mandated in the project process? The Canadian Design and Construction Report — January 2016 – 35