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Lower Costs While Increasing Profitability? Yes You Can!. Ted Garrison New Construction Strategies Ted@TedGarrison.com www.TedGarrison.com 800-861-0874. What’s the Biggest Source of Lost Productivity?. Waste!. Amount of Waste . Value Added 10%. Waste – 57%. Support Activity 33%.
Value Added 10%
Waste – 57%
Support Activity 33%
Waiting –Liska report says 20% of loss productivity
Over production– storing in warehouse or estimating errors
Transportation – unnecessary loading or moving materials
Motion – searching for stuff
Over processing– duplicate forms or unnecessary reports
Inventory – unused stuff only clutters work space
Untapped employee creativity– potentially the worst
Stress/Over burden – it just zaps our energy
Unevenness/variation – destroys long-term productivity10 Types of Waste
The 11th form of waste – Chase Up™!
How much time do you spend chasing people?
Which weighs heavier on a project in terms of reliability?
The reliability of people to make and keep promises?
The reliability of stuff?
One of my radio guests, Ed Anderson, coined the expression – Chase-Up™! NCS Radio (www.NCS30.com) interview: www.jackstreet.com/jackstreet/WCON.AndersonE2.cfm
He defines Chase-Up™ as “the act of checking over and over again the progress of a commitment or promise by either contacting other people, or directly inspecting the works to determine the progress.”
Some call it: follow-up, inspecting, expediting
How much time are you wasting?
What could you do with that saved time?Chase-Up™
Day-in and day-out, what is the average % of your time spent chasing the progress of commitments made to you? ________
What % of your time is spent being chased by others? ________
Obviously this is so important that everyone has been formally trained on how best to chase-up. So, what are the top three best practices of Chase-Up™ taught in your class?Chase-Up Syndrome™
If average worker earns $75,000 – that equals a $7,500 savings per worker or increased profitability
If you have 10 people – you could eliminate one
What are you going to do with all that extra time?
Be more productive?
Improve planning to reduce the schedule?
Are you satisfied with your safety progress?Chase-Up Syndrome™
Reliability to make and keep commitments, which allows
Reliable planning and productionChase-Up Syndrome™
We can agree that some external discipline (chasing) must be applied – but how much?
If Chase-Up™ doesn’t guarantee lower costs, faster schedules, higher quality, improved safety, what does it guarantee?
Higher costs and we don’t even know how much more because we don’t measure Chase-Up™!Chase–Up Syndrome™
Your electricians have agreed to complete all imbedded slab work by close of business Thursday!
Electricians lied – they hid a buffer!
You lied because you asked for it sooner than you needed!
This creates inefficiency!
Which crews would require the most Chase-Up™?
You don’t know!Example
Which one do you chase the most?
On a typical project, how long does it take to establish a contractor’s reliability?
Would it be worthwhile to reduce that time to days, and to be able to measure it objectively?
If “YES”, HOWdo we measure the “Reliability of People to make and keep commitments” objectively?Example
Earned value – which is measure by productivity
EV = $9,800
[6 x $1000 x 100% = $6000] + [4 x $1000 x 95% = $3800] = $9800
Let’s turn things on its head and ask:
What if we paid people based on reliability first and productivity second?
Do you think that would change performance?
Reliability payment: $6000
[6 x $1000 x 100% = $6000] + [4 x $1000 x 0% = $0] = $6000Example
Tells us we are not very reliable, but doesn’t tell us what to do!
If someone doesn’t meet his commitment get them to define the reason in as few words as possible
This isn’t a reprimand – it’s about identifying the problem
Chart the problems in a histogramIdentify the Problem Case Study
Tells us we are not very good at planning & coordination, but doesn’t tell us what to do about the problems!
Pareto Principle indicates 20% of the issues will cause 80% of the problems!
Category Root Cause Task ID Date
CRI trend was slightly positive
(45% - 48%)
Variance around trend line is
sizable and trend lag on the low
side (less reliable)
CRI trends very positive (49% to 84%)
Variance around trend line is less than before , and trends on the high side (more reliable)
After getting weekly commitment – need to capture daily actions
Monday Morning: What are you going to do this week?
Tuesday Morning: Did you do what you said you were going to do yesterday?
Then why not in as few words as possible
Categorize (weather, planning, coordination, materials…)
What are you going to do today?
Repeat process the rest of the week!Applying the Application
6 are 100% completed – 4 are 95% completed
CRI = Actual # completed/Total # committed to
6/10 = 60%
A measure of reliability to:
Make & keep commitments
To plan & execute: “Did you do what you said you were going to do?”
Not a measure of productivity or production
What do you think is the average CRI on a non-lean project when first measured?
55%Review of CRI & Chase-Up™