working with the university of waterloo

TOWN AND GOWN
WORKING WITH THE UNIVERSITY OF WATERLOO
Is “productivity improvement” academic? Not according to the results of a two-year
study by the University of Waterloo in conjunction with Aecon. With a focus on how
to improve productivity on construction sites, the results of the Aecon Industrial-led
study are proving to be anything but academic.
A
ONE – THE MAGAZINE OF AECON GROUP
Manufacturers are renowned for squeezing
every possible bit of productivity out of the
assembly process. Shaving a few seconds
off the line, eliminating unnecessary
screws and bolts, or simplifying the
packaging can add up to millions of
dollars in savings. Improving productivity
in construction, on the other hand, is a
different proposition. Construction is a
much more fluid, reactive activity. Every
construction project is unique, making it
that much more challenging to standardize
work practices, control the workflow, and
coordinate all the varied activities that
simultaneously occur. All the more reason
to ensure its complexity is addressed,
says Hugh Loughborough, Vice President
of Contracts and Risk Management for
Aecon Industrial.
“Improving productivity doesn’t just
mean working harder, or faster, or longer,”
he maintains. “Productivity improvement
comes from identifying and using the
best work practices: finding ways to make
better use of our equipment, for example,
or improving the way we manage
materials. But identifying those best
practices is not an easy task. We can,
and we do, look within the organization
to find better ways of doing things, but
sometimes, getting an outside opinion
provides a fresh perspective.”
Loughborough’s interest in construction
productivity stems from his own graduate
studies in the mid-1980s at southwestern
Ontario’s University of Waterloo. Despite
his interest, Loughborough’s professors
retired and the study of construction
productivity “fell off the radar” until Dr.
Carl Haas joined the University. In 2010,
Loughborough met with Haas, a
Professor of Civil Engineering, to
determine what the academic world had
to offer the construction industry.
Aecon was already familiar with Dr.
Haas’ work, having first encountered him
in 2007 on the Portlands Energy project in
Toronto, where his pioneering work using
radio frequency identification (RFID) tags
was being incorporated to control the
flow of materials on the construction site.
Loughborough also knew Dr. Haas was
closely associated with the Construction
Industry Institute, a consortium of more
than 100 leading contractors based out
of the University of Texas, which is
involved in the development of best
practices for the construction industry.
“There is a lot to gain by working
closely with universities,” maintains
Loughborough. “We get to tap into
the expertise of the faculty and the
enthusiasm of the students. The
university, in turn, gets to put academic
theories into practice and gives students a
chance to see what the ‘real’ world is like.”
Loughborough and Haas agreed to
conduct two simultaneous studies:
the first was an activity analysis of
construction projects; the second was a
benchmarking study to see how Aecon
Industrial compared to other contractors.
The activity analysis covered six
projects, including industrial installations
at a compressor station near the Lobo
and Union Gas Dawn storage facility,
where Haas’ graduate students spent
several days observing what was going
on and taking measurements of a
variety of activities.
“It’s a bit like a ‘time and motion’ study
in a manufacturing facility,” explains Haas.
“You want to find out how you can
improve ‘wrench time’; how to reduce the
travel time for employees and materials
to get around the site; and how
to improve the direct work rate. You’re
there to observe, to take measurements,
and to make recommendations. Then, you
go back afterwards to see if any
improvements have been made.”
The direct work rate on a construction
site, or the actual time doing productive
work, is surprisingly low. Target rates
for bricklayers, insulators, labourers,
and painters range between 42 and 46
percent. Target rates for pipefitting
and electrical work, which are more
complex and difficult to plan, range
between 27 and 29 percent. Based on
the activity analysis and some of the
recommendations from the university
team, Aecon Industrial was able to
increase the time spent on prep work and
make adjustments to the site layout so
that employees were spending less time
waiting for material and travelling around
the site. As a result, direct work rates at
Lobo increased from 30 to 35 percent and
at Dawn from 28.5 to 32 percent.
“This was essentially a cut-down
analysis,” concludes Haas. “We
weren’t specifically looking for major
improvements. What we wanted to do
was demonstrate that Aecon could use
this sort of observational analysis to
improve productivity, often with some very
simple and easy-to-implement practices.”
The benchmarking study is considerably
more substantial.
Aecon Industrial supports standard
processes for defining construction
activities that are modelled on the best
practices the industry has to offer.
Are those practices being used to best
effect? The only way to know, says
Loughborough, is to compare Aecon’s
productivity to comparable contractors
in the industry. Easier said than done,
however, as many companies aren’t
ready to share the information.
“Using the University of Waterloo to
develop what is called a “Benchmarking
and Metrics Program” gave us an
independent analysis of our productivity
to compare against the industry standards
that have been developed by the
Construction Industry Institute through
its analysis of more than 200 projects.”
One of Haas’ graduate students, a
brilliant young Ph.D. candidate, Di Zhang,
looked at Aecon productivity processes
data from 10 different projects. Among
them were two power generation
projects, three gas pumping stations,
two automobile plants, two wastewater
treatment plants, and a nuclear power
condenser installation. Zhang compared
Aecon’s implementation of best
productivity practices to industry
benchmarks. His conclusion? While
Aecon Industrial’s implementation
compares favourably to industry
averages, there is, not surprisingly,
room for improvement.
The Construction Industry Institute’s
best practices fall under seven broad
categories: change management,
constructability, front end planning,
materials management, partnering,
zero accident techniques, and project
risk assessment. Haas says this provides
a solid framework to look at productivity
systematically.
“We are convinced Aecon Industrial
can develop a program based on the
benchmarking analysis that can improve
labour productivity by as much as 25
percent,” he maintains. “The cost to
implement the program is relatively small,
but if the payoff is as much as we
estimate, the savings could be in the
millions of dollars a year.”
Loughborough concurs. “The activity
analysis showed us there are some
quick wins to be had, but it will take
considerably more effort to make
fundamental improvements. The
benchmarking exercise can help point
us in the right direction. We’re pleased
with the analysis the University has given
us so far. Now it’s up to us to identify
the metrics we can use so that we start
tracking our progress.”
S P R I N G / S U M M E R 2 013
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