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Construction Management and Economics (September 2003) 21, 581–591

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Construction and the time compression paradigm
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7 DENIS R. TOWILL*
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Cardiff Business School, Cardiff University, Aberconway Building, Colum Drive, Cardiff CF10 3EU, UK
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1 Received 24 November 1999; accepted 7 March 2002
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6 The total cycle time (TCT) compression paradigm has already come of age in many market sectors, and is
7 widely seen as the route whereby companies attain international competitiveness. However, it is essential
8 that the relevant business processes are skilfully re-engineered to compress total cycle time if the potential
9 benefits of implementing the paradigm are to be achieved in full. As the paper shows, reducing TCT in this
2011 way improves all the important business performance metrics. The paper concludes by describing the T40
1 construction programme, in which 25% cost reduction has been consistently achieved by re-engineering the
2 relevant business process to compress total cycle times by 40%. Reduction in TCT achieved in this way
3 does not compromise safety or quality.
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Keywords: Total cycle time, business systems engineering, business processes, cost reduction, innovation in
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construction
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3 Introduction ● material suppliers cutting capacity leads to
4 higher process costs and longer delivery times;
5 The construction sector is often perceived as ‘unique’ ● uncertainties arise from many sources;
6 in the range of problems encountered. However, closer ● tendering has become expensive and laborious;
7 examination shows that there is no single problem that ● ‘players’ aim to bid low and then make a profit
8 is special to the sector: what is certainly true is that there from penalty payments; and
9 is a unique combination of problems that faces the ● clients often end up paying up to as much as
4011 industry. However, the fact that every problem is to 50% extra for projects completed late.
1 some extent shared elsewhere does mean that new prac-
Fortunately, as George (1996) emphasizes, there are
2 tices proven in, say, the manufacturing sector may well
exceptions to the above somewhat gloomy picture, and
3 find profitable application in construction. In this paper
construction sector market leaders are identified by
4 the theme advanced is ‘experience transfer’ into con-
their ability to: (a) complete projects ahead of time;
5 struction via the total cycle time (TCT) compression
(b) complete projects within budget; and (c) resist
6 paradigm. Here the emphasis is on the re-engineering
compromises on safety or quality standards.
7 of business processes to reduce the time between cus-
Within the UK one response to this situation has
8 tomer need identified and customer need satisfied
been the sponsorship of the ‘Construction as a
9 (Towill, 1997).
Manufacturing Process’ Programme by the EPSRC
5011 Some observed characteristics of construction are:
Innovative Manufacturing Initiative (IMI), as illus-
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● tendency to make money out of other ‘players’ trated in the housing critique and comparison by Gann
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alleged mistakes; (1996). There is an increasing realization that innova-
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tion rather than invention is what gives a company a
4 *E-mail: ScottD1@Cardiff.ac.uk competitive edge. In this respect the definition by
5511
Construction Management and Economics
ISSN 0144-6193 print/ISSN 1466-433X online © 2003 Taylor & Francis Ltd
http://www.tandf.co.uk/journals
DOI: 10.1080/0144619032000134110
582 Towill

1111 Arthur Koestler (in The Act of Creation) is highly rel- Table 1 US construction sector performance improvement
2 evant (Sherwood, 1998). He argues that ‘Innovation targets to be achieved by year 2003 ( Wright et al., 1995)
3 is borne out of the re-arrangement of existing compo- Construction sector Year 2003 target Ranking in
4 nent patterns and is not creative in the Old Testament performance metric improvement importancea
5 sense. It does not create something out of nothing.
6 Instead it uncovers, selects, re-shuffles, combines, syn- Total project Reduce by 50% First
7 thesizes already existing facts, ideas, faculties, and delivery time
8 skills. The more familiar the parts, the more striking Operation, maintenance Reduce by 50% Second
and energy lifetime costs
9 the new whole.’
Productivity and Increase by Fifth =
1011 Thus, as Jack Trout (1999) has emphasized, some-
comfort levels of 50%
1 thing borrowed is simpler to exploit than a new inven- occupants
2 tion. It is therefore likely to be much easier to Occupant health Reduce by Sixth
3 implement with a corresponding increase in the chance and safety costs 50%
4 of success. An idea therefore needs only to be original Waste and pollution Reduce by Fifth =
5 in its adaptation to the ‘new’ problem. Hence in the costs 50%
6 search for transferable ideas the benchmarking concept Durability and Increase by Third
7 has proved particularly helpful. So in searching for flexibility in use 50%
8 ‘best practice’ it is perfectly acceptable (and indeed over lifetime
9 actively encouraged) to look at other market sectors. Construction worker Reduce by 50% Fourth
2011 Thus in the IMI programme referred to above, one health and safety
1 specific aim is to promulgate such best practice as costs
2 widely as possible, irrespective of market sector of a
Ranking in industry importance obtained from White House
3 origin. It is the purpose of this paper to demonstrate Construction Industry Report workshop participants representing the
residential, commercial, institutional, industrial, and public works
4 that the total cycle time compression paradigm repre- construction sectors.
5 sents such an innovations opportunity for best prac-
6 tice transfer between industries, countries, and market
7 sectors.
8 able evidence from a wide variety of sources to ensure
9 that we are dealing with a true paradigm and not a
3011 Construction targets for the new mere transitory ‘fad’ (Towill, 1999). Hence this paper
1 millennium provides the substantial evidence available on the
2 successful application of the TCT paradigm across
3 It is important to emphasize that, in seeking to attain other market sectors. This material is introduced
4 international competitiveness, improvement in one ahead of a review of an impressive case study com-
5 business performance metric must not be sought at the paring 300 building projects analysed via a regression
6 expense of another, otherwise there will be no overall model. The results therein suggest that properly
7 gain to the company. Fortunately, the industry appears re-engineered via the TCT paradigm, construction
8 to be well aware of this problem. For example, Table 1 projects deliver business benefits every bit as impres-
9 lists US construction sector improvements targeted for sive as previously obtained in the manufacturing and
4011 the year 2003. Note the emphasis on delivery time, service sectors. Also, quality and safety are not preju-
1 operating costs, lifetime durability/flexibility, and safe diced by proper application of the TCT paradigm, as
2 working, and the quest to enable these improvements demonstrated in ‘lean thinking’ (Womack and Jones,
3 in parallel. A practical innovative example of what has 1996), to which time compression techniques are
4 already been achieved in the UK is the reduction in closely linked.
5 construction time for similar supermarkets of 50%.
6 Perhaps even more important is the demonstration for
7 identical building projects of the parallel reduction in Paradigms old and paradigms new
8 ‘snags on handover’ from 1800 down to three achieved
9 via the ‘partnering’ method of working (Johnston et al., According to BPR experts Morris and Brandon (1993)
5011 1997). This demonstrates that substantial reductions in the word ‘paradigm’ has received much publicity and
1 TCT can be accompanied by impressive gains in qual- less understanding, so we need to consider carefully
2 ity, and this starts moving construction away from the exactly what it means. They quote the dictionary def-
3 scenario painted in the Introduction. inition of a paradigm ‘as an example or pattern, espe-
4 In seeking transfer of relevant best practice between cially an outstandingly clear or archetypal one’.
5511 market sectors, it is crucial to critically examine avail- However, at a practical working level, they expand this
Construction and the time compression paradigm 583

1111 definition so that a paradigm: to the original status quo, as typified by the classic WIP
2 reduction experiments by Gomersall (1964). Thus
● is a set of rules that establish boundaries and
3 when encouraged to reduce backlog via better working
describes how to solve problems within these
4 methods, the operators ‘beat the system’ to protect what
boundaries;
5 they considered to be their WIP comfort level.
● influences our perception and help us organize
6 The message here is clear. If the TCT compression
and classify the way we look at the world;
7 paradigm is to deliver benefits into the construction
● is a model that helps us comprehend what we
8 sector it must be understood and actively supported at
9 see and hear;
all levels in the company from CEO to individual oper-
1011 ● can disable objective thinking based on this
ators.
1 information;
2 ● operates at the subconscious level; and
3 ● may be seen as sets of unquestioned, subcon- What is the total cycle time compression
4 scious business assumptions. paradigm?
5 Morris and Brandon (1993) then describe a ‘paradigm
6 shift’ as: The TCT compression paradigm may be simply
7 expressed as ‘the principle of reducing the time taken
8 ● a significant change in the rules, assumptions to execute a business process from perception of cus-
9 and attitudes related to an established way of tomer need to the satisfying of that need’. Although the
2011 doing something; benefits of doing things quickly (and well) have been
1 ● having the effect of a new beginning, i.e. a new understood for some time, the TCT compression par-
2 way of doing things. adigm as a formal mechanism for increasing company
3 performance is of recent origin. Industrialists in the UK
This is a ‘paradigm found’, but often to achieve success
4 such as Jack Burbidge (1983) and John Parnaby (1988)
an existing paradigm that stands in the way of progress
5 were early advocates of the paradigm, but it was left to
may need to be a ‘paradigm lost’. This is because:
6 management consultants such as Stalk and Hout
7 ● an old paradigm may be held so strongly that (1990) to widely publicize the approach. Early suc-
8 it prevents detection and acceptance of the need cesses were reported in electronic products, mechani-
9 for change; cal engineering, banking, and insurance sectors.
3011 ● tensions between old and new paradigms can Table 2 is an outstanding example of how TCT com-
1 lead to erratic and under-performing experience pression was marketed by the management consultants
2 curves; and as a set of slick, easily remembered rules. The associ-
3 ● there are real dangers in the working methods ated Stalk and Hout (1990) text is certainly thought-
4 associated with the new paradigm regressing provoking (as was intended). It also leaves many
5 back to the old familiar routines. questions unanswered for the busy executive seeking to
6 influence change. The contribution by Thomas (1990),
7 Morris and Brandon (1993) have also concluded also a consultant, is complementary to Stalk and Hout,
8 that, in BPR terms, a new paradigm is essential: as can be seen from Figure 1. Here the order-of-mag-
9 ● if a significant change in business is sought. nitude improvements resulting from a sample of TCT
4011 programmes are displayed and confirm that, subject to
1 This is because: proper re-engineering, all normal performance criteria
2 are bettered. Thus the proposition may be advanced
● the future cannot be viewed through old para-
3 that performance improvement via the TCT paradigm
digms.
4 is not in dispute. However, the leverage exerted may
5 A well known case of old and new paradigms concerns well be sector dependent, which is a powerful reason
6 the move in the automotive industry from just-in-case for ongoing research in construction.
7 (large stock levels) towards just-in-time (small stock lev- Thomas (1990) also established two very important
8 els). The former paradigm accepts losses both in time key points associated with TCT compression pro-
9 and material throughout the delivery system, whereas grammes. The first is that the only worthwhile goal is
5011 the latter paradigm seeks to eliminate waste at source, to reduce TCT from customer need right through to
1 hence reducing uncertainty throughout the system. It is customer need satisfied. In other words it is counter-
2 manifest that it is just not feasible to have these two par- productive to reduce process times that do not affect
3 adigms operating in parallel. The consequence of con- TCT significantly (and that also might require as much
4 tinuing to operate with conflicting paradigms is likely to effort to be expended as doing something really worth-
5511 result in temporary improvement followed by regression while). The second key point is that as the TCT is
584 Towill

1111 Table 2 The time compression paradigm: an outstanding early example of the management consultant perspective (Stalk
2 and Hout, 1990)
3 No. Meaning
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5 Rule 1 Most products and many services are actually receiving value for only 0.05 to 5% of the time they
6 The 0.05 to 5 Rule spend in their value delivery systems
7 Rule 2 Lost time is spent in three roughly equal categories: waiting for our batch to be completed;
8 The 3/3 Rule queuing for the next process; and management decision making delays
9 Rule 3 Every quartering of the cycle time doubles labour and working capital productivity, with costs
1011 The 1⁄4-2-20 Rule reductions at up to 20%
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2 Rule 4 Companies that cut cycle times in their value delivery systems achieve growth rates three times the
The 3  2 Rule national average, with profit margins twice the industry average
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5 by every business metric, i.e. no trade-off or engi-
6 neering compromise is required.
7 A further step in the provision of evidence to support
8 the transition from fad to paradigm is the publication
9 of the results of carefully designed industrial surveys.
2011 The aim here is to perform independent analyses to
1 establish causal relationships of high statistical signifi-
2 cance. Table 4 summarizes the results obtained by
3 Schmenner (1988) in a large scale (of several hundred
4 companies) experiment, by surveying three different
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6 Table 3 The manufacturing industry case study perspec-
7 tive: typical results quoted by Parnaby (1995) on the time
8 compression paradigm applied to an aerospace actuator
9 Figure 1 How reducing the TCT paradigm leverages the company
3011 company bottom-line: a range of industrial results reported
by Thomas (1990) Benchmark Improvement
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2 Lead time Down 75%
3 Manufacturing costs Down 75%
4 progressively reduced, the process variance decreases. Material movements Down 90%
Inventories Down 75%
5 In other words, not only does a TCT compression pro-
Work in progress Down 75%
6 gramme reduce the expected cycle time, but achieve-
Adherence to schedule Up 30%
7 ment on target is also better guaranteed. Product ‘ownership’ Much improved
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4011 TCT results from the manufacturing sector
Table 4 The industrial survey perspective on the time
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compression paradigm: results of large scale review estab-
2 Although clearly the opinions of management consul-
lishing that cycle time reduction is a significant productivity
3 tants are of importance in shaping industrial change driver (Schmenner, 1988)
4 strategy, to move from fad to paradigm is in itself an
5 important process in which corroborating evidence Factors tested for statistical significance Significant?
6 must be forthcoming from a variety of sources (Towill, Investment in high technology No
7 1999). Detailed industrial case studies have a very Setting up gain sharing plans No
8 important part to play, despite the reluctance of com- Investment in Class A MRP II systems No
9 panies to release the information or to spare their exec- Operator focused industrial engineering No
5011 utives time to write up a meaningful account of the Age of plant No
1 change programme. One industrial example is shown Size of plant No
2 in Table 3. This summarizes the results obtained for Global location of plant No
3 a UK Aerospace Actuator Company, and confirms that Degree of union activity No
Process/non-process industries No
4 good re-engineering of the product delivery process
Total cycle time reduction Yes
5511 (PDP) is rewarded by improved performance measured
Construction and the time compression paradigm 585

1111 market sectors and then testing the results for corre- tasks. In the light of the shared principles listed in the
2 lation between cause and effect. Of the 10 factors above section, TCT compression programmes take a
3 tested in Table 4, only total cycle time reduction was holistic view of organizations. The re-engineering is
4 found to have a significant impact on productivity. preceded by the creation of a total systems model
5 Once evidence such as that portrayed in Tables 2, (usually as a process map) of the business. Full details
6 3 and 4 becomes widely available, it would be expected of a suitable highly structured mapping approach are
7 that take-up of the TCT compression paradigm would given in Evans et al. (1997) together with a construc-
8 become widespread. This is indeed the case, at least tion example, and need not be repeated here. What
9 for top management consultants like McKinsey and must be emphasized is that we are concerned with re-
1011 Co., Arthur Andersen, Boston Consultancy Group, engineering how we do things to the highest possible
1 Ernst and Young; and ABB. For example, Werr et al. standard (a procedure usually associated only with
2 (1997) demonstrated convergence between these con- what we do) using TCT as an explicit performance
3 sultants’ business process re-engineering practices by metric against which alternative designs may be com-
4 establishing four extremely important shared opera- pared. According to Meyer (1993), process analysis
5 tional principles. involves answering all the following six questions:
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(1) A holistic view of organizations, leading to a ● from whom is the process input received?
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systems model of the enterprise. ● what is the final deliverable from this process?
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(2) Time as the explicit improvement target, reflected ● what is needed before the process can start?
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in the performance metrics used during the diag- ● how do we know when the process is finished?
2011
nosis of the organization undergoing change. ● how long does it take to complete the process?
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(3) A focus on learning, especially during the change ● to whom is the process output delivered?
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process, followed by competence transfer within
3 Regrettably, many executives want to skip the mapping
the client organization.
4 part of re-engineering, wrongly believing that the busi-
(4) Highly structured methods, which seek to identify
5 ness process is already fully understood. The same
and support the many steps in the change
6 executives then wonder why their re-engineering pro-
process.
7 grammes fail to deliver the predicted benefits. The truth
8 All four of these principles relate to the TCT compres- of the matter is (Towill, 1997) that ‘one fact is worth a
9 sion paradigm. This is because any change programme dozen opinions’ and ‘one process flow chart contains a
3011 that links customer need to customer satisfaction must dozen facts’. Thus flow charting is an essential and
1 take an end-to-end, i.e. systems, approach. Time as an major step in reliable business process modelling.
2 explicit target is self-explanatory, as it is a performance For example, a detailed study of an electronics
3 metric that travels unambiguously across company and assembly process showed that, at the shop-floor level,
4 national boundaries. Also, focus on learning is a neces- ‘real work’ involving doing things right the first time
5 sary prelude to continuous improvement in perform- accounted for only 30% of the time available. The trau-
6 ance (Thomas, 1990). Finally, having established the matic shortfall in this assembly process was largely
7 need to change the ‘what’ of how we do things, attributable to unrecognized complexity due to
8 then there is a need for a structured methodology for machine and human errors and rework occurring
9 doing this, including published checklists, software within the actual process. Unfortunately, these actions
4011 packages, and questionnaires. Good descriptions of within the work processes were not identified in the
1 suitable methodologies include those provided by existing documentation, which wrongly assumed zero
2 Meyer (1993) and Rummler and Brache (1995). The defects on the part of both products and people. It
3 latter is particularly detailed and provides the basis of therefore represented a false and extremely idealistic
4 certification of individual consultants within ABB. view of the assembly process. The message here is that
5 an erroneous model of a business process is potentially
6 every bit as damaging to a company as an erroneous
7 The importance of process mapping model of an artefact.
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9 It must be emphasized that attention is focused on a
5011 business process that spans the range of activities The detail of time compression
1 between customer need and that need being satisfied.
2 An example is the single integrated design and con- Once a reliable process flow chart of the business
3 struction business process known as T40, described process is available, various practical ideas for re-
4 later in this paper. Such a business process may contain engineering to reduce TCT may be explored. As part
5511 many work processes, each of which will contain many of the process analysis the time taken for each task and
586 Towill

1111 each delay is logged. Some process charts are indeed tional silo’ mentality, which is easier said than done.
2 laid out such that the activity may be recognized imme- It should instead be replaced by a seamless operation
3 diately as essential or otherwise (Scott and Westbrook, in which all the actors think and act as one in deliv-
4 1991). In construction there are three classifications ering the project on time, on cost, and on quality. In
5 of elapsed time in any process: (1) value-added time other words, adversarial attitudes need to be eliminated
6 (VAT), during which the product/project is enhanced and replaced by a systems approach to total project
7 in value in the direction required by the customer; management (Muir Wood, 1996; Lewis, 1998).
8 (2) non-value-added time (NVAT), which is wholly Many of the individual re-engineering tools com-
9 wasted since it contributes nothing to the product, monly used to effect TCT are already familiar to the
1011 project, safety, or quality; and (3) essential non-value- construction sector. What is innovative is the particu-
1 added time (ENVAT), which is regarded as an essen- lar way they are brought together for the sole purpose
2 tial part of the process, such as safety/quality audits. of effectively and efficiently removing time from the
3 In a nutshell, TCT compression is based on re-engi- business process (Towill, 1996). It is convenient to
4 neering a business process to eliminate NVAT and to group the tools under four headings: industrial engi-
5 systematically (and safely) reduce VAT and ENVAT neering; IT; product engineering; and operations engi-
6 (Towill, 1996). Table 5 lists the basic principles by neering. Table 6 gives simple construction sector
7 which these ideas may be implemented via elimina- examples under each heading. They have all been
8 tion, compression, integration, and concurrency. Note applied widely within the industry; all we ask here is
9 that the integration route is concerned with better that as an integrated package they be specifically
2011 engineering of business interfaces across all the organ- directed at TCT reduction, since we have seen from
1 izations involved in a project. In particular, this is the the manufacturing sector that all performance metrics
2 opportunity to be seized to banish forever the ‘func- will then be bettered.
3
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Table 5 Basic re-engineering principles for taking time out
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of the value stream
The T40 TCT programme
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7 Time compression Corresponding engineering This case study was devised to enable a new industry-
8 principles procedure wide process for construction. As shown in Figure 2, this
9 Elimination Totally remove an unnecessary work new process is capable of reducing time to completion
3011 process from the value streams of construction by 40%, resulting in a consequential
1 Compression Eliminate NVA time and/or streamline costs saving of 25% of the capital value (Ireland, 1996).
2 essential NVA/VA time within the The T40 study concentrated on re-engineering and
3 work process
4 Integration Eliminate interfaces between successive 40% time
5 work processes to streamline
material and information flows reduction
6 100%
T40 project
25% work

Concurrency Develop ways of executing work


reduction

7 completed
processes in parallel, not sequentially
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4011
Table 6 Examples of use of standard re-engineering tools
1
in time construction sector compression programmes
Work undertaken

2
3 Source of performance Simple construction sector
al
ion

4 improvement example of beneficial change


pro radit

Construction
t
jec

5 commences
t

Industrial engineering Line balancing of excavation


on
ct
k on

on T40 project
proje

6
rk

teams for maximum earth


Wor

Wo

7
T40

removal rate
8 Information technology Order transfer via EDI enabling
9 quick and unambiguous Construction
5011 information commences on
“Traditional” project
1 Product engineering Standardization for easier
assembly both off site and on 0% 100%
2 Project time
3 site
Operations engineering Just-in-time, not just-in-case
4 Figure 2 Work-time relationship as influenced by a one-
deliveries to site
5511 stage design and construction process (Ireland, 1996)
Construction and the time compression paradigm 587

1111 integrating the design and construction business process A critical issue is the definition and sharing of risk
2 for a capital facility such as a building, using principles and rewards, so that there is an adequate incentive for
3 that can be adapted to civil engineering or process members of the solutions group to act as a coherent
4 plants. An important outcome of T40 was substantive team. Clearly the lead contractor should not have to
5 evidence that the TCT compression paradigm applies to share rewards without being able to share risks.
6 project-based companies and project-based value
7 streams.
8 The starting point for the T40 project was the know- T40 statistical model
9 ledge that managing the process of producing a build-
1011 ing, a civil engineering structure such as a road or It is the aim of the T40 case study to provide a selec-
1 bridge, or an oil refinery involves a similar set of tion system that identifies the best contractor on the
2 processes. These include: definition of needs; feasibil- basis of the following criteria:
3 ity study; design and detailed specification; and then
● past record on time performance, by reference
4 construction. But while there is similarity between pro-
to an industry time database;
5 jects, essentially every project is also different and is a
● agreed cost based on an adequately developed
6 prototype, because the site is different and hence the
design;
7 design is different. The situation is further complicated
in the ‘traditional’ way of working with temporary ● third-party endorsement of cost as being close
8
teams assembled specifically for the project right across to the best price; and
9
the spectrum from architect to the smallest subcon- ● agreed TCT that is significantly better than the
2011
tractor. So in theory there is limited opportunity to industry average for a building of the type (e.g.
1
learn from repeated cycles. Nevertheless the T40 project 40% better time performance, which statistically
2
is aimed at exploiting the practical similarities between is found to correspond to a 25% reduction in
3
projects as the basis for innovation in construction. costs).
4
5 A fundamental part of the T40 project involves The approach is based on the fact that time perfor-
6 process analysis using the tools already set out earlier. mance over a range of projects can be ranked by ref-
7 These include mapping the ‘as is’ flowchart, high- erence to a set of performance indicators that are
8 lighting issues for change, identifying the value-added independent of the physical dimensions, building type
9 items as judged by the customer, innovating a ‘should and complexity of the building. The industry average
3011 be’ flowchart for the re-designed process, analysing the performance can then be expressed in terms of a
1 ability of the proposed changes to meet the programme limited number of key variables, such as cost, build-
2 goals, highlighting input-activity-output relationships ing type, area, height and complexity.
3 for all key parts of the process, providing a route map The new approach to contractor selection requires
4 for implementing change, and finally documenting and an adequate database to be available plus the ability
5 promulgating the results to get ‘buy-in’ from all the to fit a regression equation linking TCT with other
6 participants. In our experience over a range of indus- important variables. This was achieved by accessing
7 trial sectors obtaining such ‘buy-in’ is probably the crit- the 300-building database of the Royal Commission
8 ical issue in process re-engineering. into the Building Industry in New South Wales. The
9 According to Ireland (1996), the final integrated regression equation for industry TCT was based on
4011 design and construction process requires that the whole the following 10 variables:
1 solutions team be involved from the point of deter-
mining the customer needs to those needs being satis- (1) Cost;
2
fied. Specifically this requires the following modus (2) Building type;
3
operandi: (3) Location;
4
(4) Project delivery system;
5 ● clear specification of customers’ needs, prefer- (5) Planning time;
6 ably in performance terms; (6) Document quality;
7 ● acceptance of responsibility by the whole team
(7) Public/private client;
8 for the design and construction phases: a sig-
(8) Familiarity with technology;
9 nificant change from current practice;
(9) Design complexity;
5011 ● negotiated cost on a particular project, includ-
(10) Safety index.
1 ing reference to a third-party audit if necessary;
2 ● significantly reduced time performance as estab- The result is a performance predictor for proposed
3 lished by reference to industry time records; and projects that is independent of building type and size
4 ● single-point accountability in the solutions team and that is claimed can be used to replace the con-
5511 by the lead contractor. ventional, expensive and wasteful tendering stage.
588 Towill

1111 Table 7 Major conclusions from T40 construction study ● the need to reduce the cost of a service the first
2 (Ireland, 1996) time the process is re-engineered;
3 A. The model ● the challenge of implementing change in pro-
4 1 TCT performance can be benchmarked using a jects that typically combine the resources and
5 10-variable predictive model. hence the collaboration of at least 40 ‘players’
6 B. Time/cost relationship to deliver the completed facility; and
7 2 Project cycle times can be reduced by 40% ● craft traditions opposing new ways of working.
8 3 Total costs are thereby reduced by 25%
C. TCT range In the view of the present author the first of these is in
9
4 ‘Best’ contractor has TCT 50% less than industry fact the most inhibiting. We have already seen in manu-
1011
average facturing that regarding the impact on business profit-
1
5 ‘Worst’ contractor has TCT twice the industry ability, it may take several years before a reliable trend is
2
average established (Towill and McCullen, 1999). Further-
3
6 For a given type of building the ‘worst’ contractor more, winning at an international level of competitive-
4 takes four times longer than the ‘best’ contractor ness may require a succession of change programmes as
5 D. About the contractors new opportunities (especially in information technol-
6 7 Contractors performance consistent from project to
ogy) present themselves. For example, in the re-
7 project: ‘best’ are always best, ‘worst’ are always
engineering of an electronics products supply chain,
8 worst
9 8 ‘Best’ contractors use one-stage design and four discrete programmes may be identified. Although
2011 construction process approach there is limited overlap, these programmes are largely
1 engineered sequentially over an eight-year period (i.e.
2 approximately two years per programme). The result is
3 a level of performance improvement so great that it
Table 7 lists the most important conclusions to be would be beyond the comprehension of various ‘players’
4
reached from the T40 programme. There is thus clear as forecast at the start of the initial programme (Berry et
5
evidence that the TCT compression paradigm is al., 1995). No doubt this feeling is reciprocated in the
6
applicable to construction. However, the customary poor performers in the T40 project.
7
warning must be sounded. It is essential to re-engineer Given that any change programme requires deter-
8
the process by adopting the understand, document, mined and dedicated management if it is to deliver
9
3011 simplify, optimize (UDSO) routine (Watson, 1994). expected benefits to the business, what are the precau-
1 Jumping in and starting time compression irrespective tions that need to be taken during re-engineering? Table
2 of the value added to the customer by the process is 8 is a summary of the seven rules devised by Rummler
3 definitely not the way to consistently reduce costs and and Brache (1995), who are very experienced and suc-
4 improve the bottom-line business performance. cessful business process engineers. These rules, which
5 mirror the experience of the present author, are much
6 expanded in the original reference. Although developed
7 Barriers to change
8 Table 8 Seven rules for successful change management
9 into the time compression paradigm (Rummler and Brache,
In an earlier section we discussed old paradigms 1995)
4011
inhibiting change. This is usually the result of people
1 Rule No. Action required
2 problems, arising from fear or ignorance. Such diffi-
culties are met irrespective of the market sector, as 1 : Strategy Relate process improvement to
3 business strategy
4 instanced by Andraski (1994) in the retail chain and
by Belk and Steels (1998) in pharmaceuticals. The 2 : Involvement Involve the right people in the right
5 way
6 latter ‘change programme’, which resulted in a TCT
3 : Accountability Give task forces a clear brief and the
7 reduction of 77% and consequently much better cus- necessary accountability to achieve it
8 tomer service, was initially opposed by a staff disbelief 4 : Effectiveness Do not confuse endless re-organization
9 that change was necessary, coupled with a rearguard with effective re-engineering
5011 action by ‘players’ to try to protect functional empires, 5 : People Understand how process changes
1 i.e. maintain the silo mentality warned of above. affect people
2 T40 also met problems in implementation which may 6 : Implementation Always focus on successful
be regarded as either unique to construction or of implementation
3
7 : MOPs Ensure task force leave effective
4 greater significance in construction than elsewhere.
monitoring systems in place
5511 These include (Ireland, 1996):
Construction and the time compression paradigm 589

1111 initially for re-engineering in manufacturing and related ness process re-engineering programmes. At the same
2 sectors, the rules can be recommended with confidence time it is clear that such programmes need the same
3 for transfer to construction. Basically this is a list of key high standards of engineering to be applied to the ‘how’
4 ‘enabling’ actions that must involve all ‘players’ in the we do things, i.e. the business process, as we have trad-
5 programme. Thus process mapping and process re- itionally applied to the ‘what’ of the business. TCT
6 design are seen as merely necessary and far from suffi- compression requires good analysis of process require-
7 cient conditions for change. In particular the focus has ments, innovation at the process design stage, good
8 to be on implementation and not on just the earlier vision and planning and, finally, sound execution and
9 phases of process mapping and documentation. effective monitoring.
1011 Essential though the latter are as an enabling mechan- The initial reported success of TCT compression has
1 ism, they are but one step on the path to change. been in the manufacturing and similar sectors over a
2 However, the company should start seeing some bene- time span of at least a decade. The available evidence
3 fits once simplification is enabled, prior to full-blown is strong, forms part of the process of moving from fad
4 process enhancement. Moreover, early payback must to paradigm, and confirms that the TCT compression
5 not be interpreted as a signal to ease off the change pro- paradigm is a valid part of management theory. That is,
6 gramme: the best companies accept the long haul nature it is transferable between companies, between indutries,
7 of effective change re-engineering mechanisms. It is and between countries (Micklethwait and Woolridge,
8 working hard to implement these rules that puts the 1996). Also, when properly engineered, the paradigm
9 business in a position to win, thus minimizing the down- delivers improvements across all the bottom-line per-
2011 side potential described well in Green (1998). formance metrics. Therefore it avoids the difficult
1 As suggested by Rummler and Brache (1995), the world of trading off one area of improvement against
2 T40 case study has also provided suitable measures of some downside consequence elsewhere in the business.
3 performance (MOPs) to monitor the re-engineering This was illustrated via a reported huge reduction
4 business process. Those shown in Table 9 refer to the on faults at handover accompanying a 50% TCT
5 internal fitting-out stage of the building (Ireland, 1996), compression in a supermarket construction.
6 and are transparent, unambiguous and easy to measure. Finally, the T40 project has shown that the paradigm
7 They may therefore be regarded as a good construction can be applied with equal success in the project based
8 sector example of a monitoring system set in place by industries. The same ground rules apply as in manu-
9 the task force responsible for re-engineering the busi- facture. Unless the business process is re-engineered
3011 ness process. Manifestly, MOPs must be seen as an and implemented to a high standard, then the effort
1 integral part of managing the change programme, which is likely to prove abortive. Far from the application of
2 in this case moves from a traditional to a partnering the TCT paradigm producing watered-down benefits
3 mode of operation. in construction, the T40 results suggest equality, and
4 possibly even superiority in potential gains to the
5 ‘players’ involved. It may well be the case that process
6 Conclusions concepts fit very naturally into the construction sector.
7 Thus once the ‘buy-in’ and ‘functional silo’ problems
8 It has taken a decade for the TCT compression par- have been overcome we can expect to see the TCT
9 adigm to graduate from a fad to a widely accepted paradigm deliver innovative change programmes in
4011 principle upon which to build highly successful busi- construction which can be used as exemplars of best
1 practice for other sectors to follow. These include such
2 important areas as project management, in which some
3 Table 9 Simple MOPs to be monitored as part of a market sectors have much scope for improvement and
4 change programme towards one-stage design and would welcome a lead from construction.
construction (Ireland, 1996)
5
6 Project type
7 Acknowledgements
MOP Traditional way One-stage design
8
of working and construction
9 The support of the IMI EPSRC via a funded research
5011 Number of discrete 32 9 programme on Supply Chain Methodology for Improv-
1 activities ing Construction Industry Performance is gratefully
2 Number of subcontractors 11 5 acknowledged. The author also acknowledges with plea-
employed sure the stimulating discussions which took place with
3
Number of site visits 25 9
4 members of the Royal Academy of Engineering
required
5511 Construction Inquiry Panel.
590 Towill

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Construction and the time compression paradigm 591

1111 Appendix: Glossary of terms useful in busi- Learning organization


2 ness systems engineering applications in The learning organization is an environment where people
3 the construction sector continually extend their capacity to create new thinking
4 processes that lie behind decision making throughout the
5 Benchmarking business. It uses its ability to learn faster than its competi-
6 The continuous process of measuring products, services and tors in sustaining competitive advantage. This is coupled with
7 practices against companies renowned as industry leaders. It a determination to regard every completed task as an oppor-
8 is essential to benchmark business processes against ‘best in tunity to identify and expand those elements that constitute
9 class’, irrespective of the market sector in which the leader ‘best practice’.
1011 operates.
1 Partnership
2 Business process A generic term used to describe various ways in which busi-
3
A linked and natural group of skills and competencies which nesses within the supply chain work together as part of an
4
starts from a set of customer requirements and delivers a extended organization or family, with the objective of greatly
5 improving the competitive advantage of the whole chain.
total product or service. It is a key concept in achieving inter-
6
nationally competitive performance.
7
8 Process
9 Business process improvement (BPI) Any activity or group of activities that takes an input, adds
2011 The means by which an organization can achieve continu- value to it, and provides an output to an internal or exter-
1 ous change in performance as measured by cost, delivery nal customer. Processes use an organization’s resources to
2 time, service and quality. It is usually driven by empowered provide definitive results on behalf of the business.
3 work process teams as part of the normal brief to improve
4 productivity within their everyday duties.
Supply chain
5
6 A system whose constituent parts include material suppliers,
Business process re-engineering (BPR) design agencies, production facilities, distribution services,
7
The means by which an organization can achieve radical commissioning teams and customers linked together via the
8
change in performance as measured by cost, delivery time, feedforward flow of materials and products and the feedback
9
service, and quality via the application of the systems flow of information.
3011
approach, which focuses on a business as a set of customer-
1
related core business processes rather than as a set of organ-
2 Systems approach
izational functions. Usually it is driven by a multidisciplinary
3 task force seconded for this purpose and charged with analy- A system is the grouping together of parts that operate for
4 sis, design, and implementation of the change programme. a common purpose. In the systems approach the focus is on
5 the behaviour of the total enterprise and the design, opera-
6 tion, and interfacing of the constituent parts so as to achieve
7 Business systems engineering (BSE) best total competitive performance. It is particularly con-
8 BSE is the systems approach to designing new business cerned with the streamlining and illumination of functional
9 processes and re-designing existing business processes. It pro- interfaces.
4011 vides a structured way of maximizing both customer value
1 and the performance of the individual business, hence exem-
Total cycle time (TCT)
2 plifying a win-win scenario. BSE has available a proven tool
kit for business process analysis, which is an essential step A major philosophy adopted in many BPR programmes that
3
in both BPI and BPR. focuses on the total time required by the existing business
4
process to satisfy a customer need from the initial enquiry.
5 Because cycle times are relatively easy to predict and
6 Empowerment measure, they are powerful metrics in planning and achiev-
7 A means of managing a process whereby the personnel ing change. Consequently, TCT is alternatively known as
8 working on the process are also charged with continuously ‘time based management’ (TBM).
9 improving its performance. It is an essential part of any learn-
5011 ing organization.
1
2
3
4
5511