Great Expectations for Lean Construction in DFW

Today, I was fortunate enough to attend a kick-off meeting for the new Dallas-Ft. Worth chapter of the Lean Construction Institute. The meeting, which was hosted by Texo and facilitated by Cynthia Tsao from LCI headquarters, was an excellent opportunity for us participants to brainstorm and identify priorities for the chapter moving forward. I was truly impressed with the brainpower, experience, and boldness in the room today. I was equally impressed with the quality of ideas and priorities that were identified during our meeting.

For me, three items stood out as the most critical items to focus on, at least during the first year or so of the chapter's existence. In no particular order:

1. Developing internal knowledge and competency of Lean Construction principles. This process can be initiated through education and training, although true learning ultimately comes from doing. LCI and its friends have the ability to provide this, and the construction folks in DFW want and need it. Developing that common vocabulary, understanding the thought process behind Lean, and getting some hands-on practice with everyday Lean tools are all valuable objectives for the DFW Chapter.
2. Engaging all construction-industry stakeholders. The expectation is that the architects, engineers, and construction folks will probably join in on the fun, but that's not enough. The customers of the A-E-C industry (building owners, building operators, developers, etc.) must also be engaged. So much of lean construction depends on the level of commitment and cooperation of our customers because of the way construction contracts are typically structured. Without the support of our customers, establishing a better approach to construction will be so much more difficult. One way to begin gaining support for lean construction is by demonstrating how it actually reduces risk for the customer (more on this in a future blog post).
3. Creating the buzz. Dallas-Ft. Worth is such a great capital of business for the U.S. and the world. So many talented people, so many successful companies, so many industries, and so much pride! The DFW Chapter of LCI needs to take advantage of this by creating a buzz about lean construction. This will have to happen on many fronts, one of which should be through online social media. With plenty of talented people willing to contribute value-added content, and a wide range of platforms for delivering this content to the people that value it, there's no reason why we can't build a tribe of people who are passionate about lean construction in DFW. Once we have a tribe of passionate people spreading the word about lean construction, we have a chance at really opening it up to the mainstream construction industry.

There are numerous other focus areas that are all important. These are just the ones that really stood out to me after listening to the discussions and presentations at the meeting today.

I'm just thrilled to be involved at such an early stage of the DFW Chapter. I see limitless potential in this group, and have no doubt that we will improve the construction industry in North Texas. This will not happen over night, but in true Lean fashion, it will happen through continuous improvement over time. Today's meeting was a great first step.

Seven Years of Lessons Learned at PHH

Last week was my last week at Palm Harbor Homes, Inc.. I spent seven wonderful years with this company (the only place I've worked since graduating college in 2003). Before I turn my sights towards the future and my next great company (TBD), I think it's appropriate to reflect back on the time I spent at my first great company. In the Lean world, they might call this hansei; while in the Project Management world, they might call this "Lessons Learned." Either way, the idea is the same--learn from the past. Here are some of the things I've learned from my time at PHH...

Lesson Learned: Get your hands dirty, often.

When I was first hired as a Manager-in-Training in 2003, I thought I was going to be sitting at a desk, firing off e-mails, and filling out TPS reports. That's not what happened...not by a long shot! On my first day, I was sent out to the shopfloor to start welding steel I-beams together. Within about six months, I had worked hands-on in every department in our homebuilding factory. Blood, sweat, tears, and all. After that, I spent another six months supervising our crews and doing quality control inspections. Not exactly what I expected coming out of college.

But let me tell you, that was the most important year of my life. That was the year I first learned the importance of going to the place where the real work is being done, and seeing for myself how things are functioning. In the Lean world, they call this genchi genbutsu. At Palm Harbor, we just call it getting your hands dirty. Whatever you call it, just recognize that without it, you're limited in how deeply you can really understand the problems faced by your people everyday. This is no doubt one of the best lessons I ever learned at PHH.

Lesson Learned: Communicate, communicate, communicate.

After that year out on the shopfloor, I got promoted to our on-site construction division as a Personal Construction Manager. At first, I spent all my time putting together detailed construction schedules, examining blueprints, and analyzing cost estimates. Then, in no time at all, I began receiving all sorts of complaints from my customers, sub-contractors, employees, and just about everybody else. While I was paying so much attention to the technical aspects of my job, I had failed to pay attention to the communication needs of my project stakeholders.

The lesson I learned is that stakeholder communication is absolutely critical to project success. You can bring in a project on-time, on-budget, within scope, and with great quality; but if you fail to address the communication needs of your stakeholders, you can have a completely failed project on your hands. I learned that lesson the hard way, on more than one occasion.

Lesson Learned: It's the money, stupid.

For a couple years, I was one of PHH's most staunch supporters of the Lean Manufacturing methodology. For a while there, during my stint as the company's Corporate Lean Manager, I was responsible for spreading the Lean gospel to all our manufacturing divisions, and I did so with the fervor of a zealot. People started calling me Mr. Lean, and I felt good about that moniker. What I should have felt was the need to be a little more business savvy.

By that, I mean that I should have been doing a better job of framing Lean as an approach to achieving our business objectives. I was such a believer in Lean that I never felt the need to translate the benefits of Lean into dollars and cents. Unfortunately, many business managers only speak the language of accounting. I should have recognized that fact and adjusted my approach accordingly. That was an extremely hard lesson to swallow.

Lesson Learned: It's hard to fit a square peg in a round hole.

Following my time as Mr. Lean at PHH, I got deeply involved with the company's large-scale military construction projects. These projects were completely different from any work we had ever done before at PHH. Not only was the complexity of the buildings much greater than our normal product, but we also had a much larger scope of work being performed on-site (as opposed to in our controlled homebuilding factories). To top it all off, we had the pleasure of complying with the labyrinth of federal and military regulations pertaining to these types of projects. This was definitely not our bread & butter work.

But, it wasn't the complexity, or the huge scope of work, or the mother lode of bureaucratic red tape that caused us the most problems. It was actually our organizational structure that hurt us the most. Without going into great detail, PHH has always been organized around ongoing manufacturing operations, as opposed to temporary construction projects. As expected, PHH is quite experienced and competent at managing operations, but much less so at managing projects. Making the transition from our traditional type of work to large-scale construction projects was a huge challenge for us.

Fortunately, PHH has a great organizational culture to help mitigate the shortcomings of its organizational structure. The culture essentially smooths out the square peg so that it fits nicely into the round hole, albeit with a good deal more effort and stress involved. But that's Palm Harbor Homes in a nutshell--not a perfect company, but a company with a team full of people willing to do whatever it takes to get the job done. This wonderful organizational culture really sets PHH apart from other companies I've dealt with in my career.

Final Thoughts (Jerry Springer style)

I learned a lot in my seven years at Palm Harbor. The four lessons learned mentioned above are just the ones that stick out to me at this transitional moment. They are the ones that have resonated the most with me, and that will help me the most in my career, but there are literally hundreds of other important lessons that I've learned over my seven years with PHH. My entire time with the company was one giant learning opportunity.

I suffered through many mistakes, and enjoyed many successes. The company allowed me to try a wide range of jobs, and gave me serious management responsibilities early and often. This is a great business best practice that I wish every company utilized. I just can't see how I could have had a better environment in which to mature professionally.

On top of it all, I made friends for life while at PHH. Some of the people I worked with are just incredible. I could not have asked for a better place to begin my career. While I'm anxious and excited about the future, I'm appreciative and respectful of the past seven years. Thank you to the entire Palm Harbor family.

My Scrum Infatuation

I'm infatuated with Scrum. I had heard the term before, but never really knew what it meant. This past week, I was lucky enough to attend a lecture on the subject by Dr. Tom Sheives with the University of Texas at Dallas' Project Management program. Keeping in mind that this four-hour lecture/discussion was pretty much my first and only exposure to Scrum, I gotta say I like the concept a lot.

The Scrum Process in a Nutshell

I won't go into the history of Scrum, or how it fits into the Agile Project Management methodology, but you can read all about it here on Wikipedia. I'd rather just focus on one of the visuals that Dr. Sheives used in his presentation (courtesy of Mountain Goat Software):

This gorgeous graphic explains at a high level how Scrum works. Going from left to right on the graphic, here is the Scrum process:

1. Product Backlog is established by a Product Owner
2. Blocks of the Product Backlog are moved into the Sprint Backlog and decomposed into smaller chunks of work
3. The project team processes the smaller chunks of work in 2-4 week intervals called "sprints"
4. There are also 24-hour feedback loops during the 2-4 week sprints that include Daily Scrum Meetings
5. The Scrum process yields an output called a "Potentially Shippable Product Increment"

Interestingly, on projects utilizing Scrum, there is no project manager per se. There is the previously mentioned Product Owner, who decides on the features of the product and prioritizes the Product Backlog. There is also a ScrumMaster, who supports the project team during the sprints and conducts the Daily Scrum Meetings.

The project team is somewhat self-managing, as the team members decide for themselves how to break down the work in the Sprint Backlog and how to execute the work during the sprints. This approach to project management is quite different than the standard approach as defined by PMI's Project Management Body of Knowledge (PMBOK). Not everybody likes this departure from the standard.

Scrum & Lean

To traditional project managers, the Scrum approach seems risky and laissez-faire, but not to us Lean advocates. We understand the power of Scrum because it adheres to many principles of Lean:

• Pull...the project team pulls work from the Sprint Backlog, which is pulled from the Product Backlog
• One-Piece Flow...work is processed in small, rapid intervals with frequent course corrections along the way
• Daily Accountability...during the Daily Scrum Meeting, commitments are made, progress is verified, and problems are communicated
• Customer Value...the Voice of the Customer is provided by the Product Owner
• Servant Leadership...the ScrumMaster supports the project team, Gemba Kaizen-style
• Self-Adaptive Teams...the constant change inherent in a Scrum environment tends to yield flexible team members capable of adapting to the needs of the project
• PDCA...the Daily Scrum Meeting and the 2-4 week Sprints allow for frequent PDCA cycles, as do Sprint Reviews and Sprint Retrospectives, which are pretty much self-explanatory

Anybody who has studied Lean can see elements of lean thinking embedded within the Scrum methodology. For me, one of the best ways to tell if something is "lean" or not is to see how traditional managers react to it. While the audience at Dr. Sheives presentation seemed to be curious about Scrum, I definitely sensed some apprehension about using it in the real world. I've seen this same reaction dozens of times in regards to Lean, so I have a good feeling that Scrum is a lean approach to executing project work. This is obviously a silly way to judge the merit of a management system, but it has been surprisingly accurate in the past.

Scrum & Construction

During Dr. Sheives' presentation, one of the first things I thought of was the Last Planner System, which is an approach to construction management developed by the good folks at the Lean Construction Institute. Similar to Scrum, the LPS focuses on short time increments, rapid feedback, frequent course corrections, and continuous planning.

Whereas Scrum was developed in response to the constantly changing product requirements of the software industry, LPS was developed in response to the overwhelming complexity and lack of control in the construction industry. Scrum and LPS are just two variations of the same concept--lean project management.

Scrum has proven to be a highly effective approach in the software business, just as LPS has in the construction business. However, Scrum seems to be more utilized in software than LPS in construction, which probably points to the cultural and organizational barriers we face in construction. Figuring out how to remove these barriers is key. If we can do this, we can increase the adoption of lean methods in construction and start seeing the same great results that the software folks using Scrum often see.