Capital projects are big deals. Often leaders are “betting heavy” on making a capital project work for their business unit and getting the ROI they promised. Unfortunately, the capital projects industry historically hasn’t done very well in this regard. Studies show that more than half of capital projects fail to deliver on schedule, on budget or within specification
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. I challenge you to replace these paradigms with two important concepts: Lean Construction and 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 to see what the “hub bub” is all about.
For some time, the Design-Build Institute (DBIA) and the Lean Construction Institute (LCI) have been studying and educating around these two important delivery concepts. Often, these concepts overlap each other 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 are finding is that teams must work toward a common goal as one unit, owner included.
For over 100 years, the capital projects industry would chop up a job scope, contract out each little responsibility to an outside vendor or sub, and then plan on it being bolted back together into a working whole. As an industry, we like this system because we understand it, but it lacks actual success in the real world. This system has resulted in process delays, integrative work gaps, and budget overruns through waste and claims.
Back to the common goal—high performing projects. To get high performing projects, we need to decide very early in the project that we want to deliver the project differently. This early decision on what Project Delivery Method to use makes a huge impact to the rest of the project and its end results. Being informed to make that early choice around your specific needs will set you up for success.
Consider these key ideas when making early project decisions:
Build your team prior to/during conceptualization by using a best value selection process
Support the team with collaborative contracts (IPD creates demand 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 a team that is ready for an Integrated Lean Approach is key to delivering your project as promised to your business.
For more resources about Integrated Lean Approach, check out these articles.
The research is in: A Lean team is an “A”-team!
How satisfied, really satisfied, are owners?
Study shows importance of team integration