The Future is Lean

Balfour Beatty, one of the nation’s largest contracting firms, was an early adopter of Lean methodology, which delivers increasing value with less resources through a process of continual improvement. Justin Maletic, Director of Business Acquisition, has championed the Lean Balfour Beatty processes and applied Lean tools in unique ways across Balfour Beatty’s business practices. Justin is in his sixth year with Balfour Beatty and has been recognized with the company’s Relentless Ally award, the highest honor an employee can receive. Justin also trains Balfour Beatty on Lean tools and processes. In this interview, Syska’s Senior Principal/Western Region Leader, John Passanante discusses Balfour Beatty’s adoption of lean with Justin.

Justin Maletic, Director of Business Acquisition, Balfour Beatty Construction and John Passanante, Senior Principal/Western Region Leader, Syska Hennessy

Justin Maletic, Director of Business Acquisition, Balfour Beatty and John Passanante, Senior Principal/Western Region Leader, Syska Hennessy

What are some of the ways Balfour Beatty  has developed and implemented the Lean methodology?

 
As a company, I think one key turning point for us was around 2014 when we updated our company mission statement and established four pillars of our creed: Zero Harm, Zero Waste, Client Advocacy and Employee Inspiration. Of these, Zero Waste really embodies our aspiration to be Lean and embrace continuous learning cycle improvement.

We believe in creating an environment for continuous learning, and the Last Planner System allows us to do that. Project teams, particularly design-build, get together in a Big Room-type meeting to plan production. It allows the entire team to collaboratively determine the schedule and identify the people, time management and resources needed for success. We try to spot and prevent potential project bottlenecks before they happen.

When we do run into issues, we create a continuous learning environment. For example, if a deadline is missed, we work together in what we call the “5 Why process” to uncover and learn from root issues. We track tasks to identify what was accomplished and where we need to investigate further to uncover root causes. Sometimes you spot a systematic problem that you can address and resolve, and share as lessons learned.

Clients are requesting teamwork and collaboration details from their contractors because they recognize the value Lean brings to complex and demanding projects. They will call it out in project RFQ and RFP solicitation documents. At a recent pre-proposal meeting for a large civic project with an aggressive schedule, the agency explained that they wanted to see specific project milestones and tactics spelled out.

A powerful tactic that we use to achieve project milestones and ultimately meet schedule and budget is our Project Incentive Reward Program. At the launch of a project, we get the entire team together and identify what are the specific critical path milestones that have to be reached to meet our schedule. Then we decide which design/trade partner has most influence of that milestone being achieved, and they become part of the incentive reward program. For every milestone met, the people in the field with the greatest responsibility will share 50% of that milestone incentive with their firm. We require that the incentive be shared equally with frontline individuals who make it happen.

And finally, we rely on Choosing by Advantages (CBA) as a process to help teams make sound decisions, facilitated by the A3 tool to identify, describe, and systematically resolve issues. We include the right participants into the decision-making process and bring objectivity into the equation. It is powerful because it is fact-based and specific – examining options to compare advantages and to quantify the value of those options. We apply it lots of ways-to select partners, for design solutions, even as fundamental as determining locations for offices or projects.

In fact, right now I’m creating an internal curriculum and training on the CBA approach for our team at Balfour Beatty.

What are some positive results that Balfour Beatty has experienced by utilizing a Lean approach?

 
On one recent design-build project, we worked with our design partner to use the Choosing By Advantage process to select our design consultants for a $21M office building for the County of San Diego. We used CBA to bring objectivity to the consultant selection process and match our selection criteria for consultants to the project values defined by the client in the RFP. The result was a strong set of partners, including Syska Hennessy for MEP, lighting and energy modeling, that collaborated well during the pursuit and resulted in a win for our team.

What are some challenges with a Lean approach?

 
One of the greatest challenges has been cultural, with resistance to adopting new approaches by those who value traditional ones. I found we can break through this opposition by targeting specific, influential individuals to become early adopters and lead the way.

For example, several years back when digital plan sheets were starting to take root, we were trying to roll out our DigitalDocs process to all the job sites. At the time, I was a PM with a very experienced superintendent on our team who was protective of his tried and true paper drawings. This superintendent was highly regarded by the company and a role model for other superintendents. I knew if I could get his buy-in on DigitalDocs then he would be an advocate and help embed the process. It became a challenge about how fast one of us could find information in the drawings and the tug of war went on for a while.

Finally, I recreated a coffee stain on the digital plan sheets and that sealed the deal with that superintendent who now proudly carries an iPad.

How is Balfour Beatty leveraging virtual reality (VR)?

 
We have been experimenting with VR for a few years now and have used it in several different ways. We connected the VR technology to our 3D models on active projects, both Design-Build (D-B) and Construction Management Representative (CMR), and invited our clients and end users to virtually tour the facility before it is completed.

On two active D-B criminal justice projects, we hooked up VR to allow the sheriff s to get a sense of the space and visualize sightlines to inmates. In one situation, the team redesigned the corridor configuration because they discovered a blind spot. Making this change during construction would have been very costly.

Another recent example was during a pursuit interview where we brought in cardboard viewing headsets that have a slot for your smartphone to fit in and view via the model in VR through an FTP site. That gave the selection panel a glimpse of our proposed design as early as the RFP stage.

Balfour Beatty relies on incentive programs to align the entire team. Using a specific project and client, can you describe how it contributed to your success?

 
We worked with San Diego State University on a “Collaborative Design-Build” project delivery, the  rst of its kind at the time, on the Zura Residence Hall Renovation which was completed in 2015. SDSU had committed to a completion date before we were selected and that meant 650 beds that would be ready for students by the Fall 2015 semester. 650 beds represents 14% of all student housing capacity at SDSU, so the stakes were high.

Bob Schulz, University Architect at SDSU, is a Lean advocate and practitioner and included a provision in the RFP for the design-builder to implement a project incentive program that SDSU would fund in the amount of $750,000 (2% of the construction value). The guidelines were non-prescriptive and only made reference to the AIA IPD guidebook which gave us flexibility to develop a very custom incentive program for the project.

I personally took the lead for Balfour Beatty to develop the incentive program and authored the plan which we called the “Incentive Program Guidebook”. We conducted a SmartStart for this project, and the overarching values that came from the session were integrated into the incentive program. We came up with three incentive types for the project: schedule betterment, favorable bidder coverage and safety performance. We then set up performance targets and metrics for each type and implemented the program.

One of the unique things we did for the schedule betterment incentive was to distribute the incentive award potential across the supply chain of partners (design and construction) and even to individuals of the companies. In fact, we set it up so that 50% of the incentive award went to actual individuals on the project.

Without getting further into the details, the project was completed in time for students to take residence in Fall 2015. We have spoken about this incentive program at numerous industry events including for the Associated General Contractors (AGC) and Design-Build Institute of America (DBIA), and two Lean Construction Institute (LCI) congresses.

What are the top 3 priorities for organizations to adapt Lean methodology in their decision-making and operations?

 
Get educated. There is a significant amount of literature and research that has been done on lean methodology and it helps to understand the different methodologies better from an academic and theoretical standpoint.

Get involved. Attend industry events like LCI where you can meet others who are using the tools in real time. This balances our theory with practical applications. Lean methodologies aren’t uniformly applied to all companies the same, they need to be adapted and integrated into the company, its culture and operations in its own organic way.

Click here to download a PDF of the article, which appears in our 2017 Connections Summer magazine.