ConstructionPro Week, Volume: Construction Advisor Today - Issue: 127 - 09/30/2011

AGC, LCI Form Partnership to Promote Lean Construction

The Associated General Contractors of America (AGC) and Lean Construction Institute (LCI) have finalized an agreement to promote lean construction through an education program targeted to a wide variety of professionals in the construction community. The agreement, negotiated during the summer, takes effect immediately and will last for at least three years.


As part of the agreement, AGC will be able to incorporate the research, analysis, and source materials compiled by LCI into the new AGC Lean Construction Education Program. The program, scheduled to be launched this winter, ultimately will include 16 separate courses and three levels of credentials, to be delivered in a combination of settings.


“This agreement will connect our nationwide network of contractors with the institute’s unique expertise with and knowledge of lean construction,” AGC Chief Executive Officer Stephen Sandherr said. “We will be able to offer more content to more contractors in more places working together than either organization ever could on its own.”

Added Richard Bayer, LCI’s interim executive director: “As an organization that stresses collaboration and transparency, we’re pleased to partner with AGC in delivering a collaborative curriculum to contractors and trades. We believe this provides an important first step for working with other leaders in our industry to drive lean construction and design principles into project delivery.”


In addition to providing content for the new curriculum, LCI also will play an active role in AGC’s Lean Construction Forum, which brings together professionals with an interest in lean construction and creates learning opportunities, by providing staff and resources. The agreement also establishes a framework to allow the two organizations to work together to develop new educational materials, host workshops, and provide other resources designed to help construction firms understand and use lean construction practices.


AGC, LCI Officials Provide Additional Details to CPC/BIM

In separate interviews with Construction Project Controls and BIM Report (CPC/BIM), Michael Stark, senior director of AGC’s Building Division, and Bayer provided the following additional details:

CPC/BIM: When this winter is the AGC Lean Construction Education Program expected to begin?


Stark: Throughout November we will be releasing the first three courses in the program. The first course, Lean Construction 101, will be a two-hour online course that interested individuals can register for on the AGC website and begin immediately. Unit 1: Variation in Production Systems and Unit 2: Pull in Production will be hosted in-seat at AGC chapters across the country beginning in early December. 


CPC/BIM: What additional information can you provide about the AGC Lean Construction Education Program in terms of the names of additional courses that will be offered, tuition costs, credentialing requirements, etc.?


Stark: The Lean Construction Education Program will provide a comprehensive and practical look at lean construction practices examining the concepts pivotal to lean construction, including variation and pull in production; streamlining the construction gemba (jobsite); problem-solving principles and tools; production management; lean work-structuring, supply chains, and assembly; management by values; and integrated project delivery. 


CPC/BIM: Approximately how many contractors and other professionals in the construction community are expected to be reached through this agreement?


Stark: AGC has more than 30,000 member firms, which include general contractors, specialty contractors, and service and supply firms and a network of 95 chapters that will facilitate lean education across the country. LCI has a broad reach in the A/E/C community in the area of lean construction. However, this agreement will have an impact throughout the entire design and construction industry, even beyond the typical AGC and LCI constituencies. 


Bayer: Not only will our members benefit, but everyone in construction can benefit. In general, we have about 15,000 people who we regularly correspond with whether they’re members or not. We have about 100 large corporate members in the design-owner-GC-trade partner [sector,] and we’ve got 6,000-7,000 individual members.… We at LCI are advocates for driving waste out of the construction and design process. Our processes are kind of universal across the board in almost any construction space. We’ve worked on public projects. We’ve worked on private projects. We’ve worked on non-profit projects. We’ve worked on big-company projects, where they do things for their own account. So, really a broad spectrum of construction and design people, as big as the industry is, can benefit from lean principles.


CPC/BIM: What will this partnership be able to accomplish that AGC and LCI would not otherwise be able to accomplish independently?

Stark: This partnership allows AGC to both utilize LCI lean construction-related concepts and processes in its development of the AGC Lean Construction Education Program and to benefit from LCI’s input during development. For LCI, this agreement creates an alliance with one of the nation’s leading construction associations, allows LCI to be affiliated with a first-of-its-kind lean construction education program, and gives LCI and lean construction processes greater exposure to AGC members and the construction industry as a whole. 

Bayer: One of the things that is important for us is that when we speak about lean … everybody is speaking the same language. So, we want to have a common language, a fundamental set of principles and a basic understanding of what we’re talking about. It benefits us because it gets us the attention and the gratification of our view of what those common principles and common vocabulary really is with the AGC, which is the largest contractor organization in the country. So, it’s very helpful to have them on our side, and it’s very helpful for them to have us on their side in helping to find with us what that common language and fundamental principles and basic practices really are, so it’s a win-win for both of us, and we’re pushing on to have relationships with the American Institute of Architects, Association of Building Contractors, Construction Owners Association of America, [and] Construction Users Roundtable, Design-Build Institute of America, Construction Management Association of America. Those are the big ones I can think of right off the top of my head that we kind of have in our sights.


CPC/BIM [to Bayer]: You have aspirations for comparable partnerships with those organizations?


Bayer: Right. We would just like … help from those associations in spreading the word, and we would like their participation in helping us form the common language, basic practices, and fundamental principles.


CPC/BIM: About how much money is being invested in this initiative? (How much money will each organization and anybody else contribute and by when?)


Stark: These business details are not publically available.

CPC/BIM: How will the organizations go about promoting this new initiative?


Stark: Each organization will share the news of this new partnership with other organizations in the industry, with AGC and LCI members, and with the respective AGC chapters and LCI communities of practice. In addition, the two organizations will work together to promote each respective organization’s lean construction-related events and resources and work together on lean construction-related initiatives in the future.


CPC/BIM: Do you have any estimates or statistics on how much money can be saved through the use of lean processes?


Bayer: We see 25-30 percent labor savings on jobs by coordinating efforts through the trades. Sometimes that translates into money saved for owners if they participate in a full integrated project-delivery process, and sometimes that just results in money being made by the trade contractors because they’re so much better organized on these lean jobs. In general, you can affect the overall efficiency of a project positively by 25-30 percent, and in some instances it has been substantially more than that. That’s just not on the building side. This also works on the design side. In general, if you’re on an integrated project team that’s doing integrated project delivery or some form of it, you’re on the team much earlier in the process than you normally would be. The knowledge of a team increases because you’re no longer having to make assumptions about what HVAC costs or roofing costs because there are people on the team who can supply that information. In the design side, the efficiency that you have [is] in actually designing to a budget so that you’re not going out and designing plans and then having bid and then coming back with substantial overruns or with changes that need to be made and doing a substantial amount of rework. It’s hard to get your arms completely around what the savings are there, but there are substantial savings obviously if you don’t have to do rework. We’ve had as much as a 90 percent decrease in RFIs on integrated projects, and the standard industry cost of an RFI is $600-1,000. So, if you’re in a hospital that had 600 RFIs, and you could eliminate 540 of them, you could save almost $500,000.


CPC/BIM: Additional comments?


Bayer: I think this is great for the industry. I think that LCI has been kind of the voice of lean out there in the wilderness, and now this partnership and hopefully subsequent partnerships that we intend to craft will, in fact, secure that position so that we can develop metrics that measure the same stuff. We can drive wastes out of construction and design processes, and, most importantly, we can drive value back into the built environment.



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