Customer

Lean Project Management
  A
way to do more & more with less
  & less – less effort, less equipment,
  less time & less space - whilst providing
customers with exactly what they want
Source : Dan Jones
Dr Rumesh Kumar February 2007
Lean Project Management
  Lean
Project Management is a philosophy
based on lean manufacturing
  It involves managing and improving the
project to profitably deliver what the
customer needs
  It is an all encompassing culture,
a behavior or mindset that focuses on the
Customer.
Dr Rumesh Kumar February 2007
What is Lean?
Lean Project Management
Is about eliminating waste in processes
Rejects
& Rework
Transport
Inventory
Motion
Overproduction
Over
processing
Trash
Dr Rumesh Kumar February 2007
Lean Project Management
  Is
about expanding capacity by reducing
costs and shortening cycle times between
order and ship date
Dr Rumesh Kumar February 2007
Lean Project Management
  Is
about understanding and doing only
what is important to the customer
Dr Rumesh Kumar February 2007
Lean Thinking in Project Management
  Lean
thinking is a philosophy in which the
customer pulls value from the project,
rather that the project pushing products
at the customer.
Source : Naybour
& Daly
Dr Rumesh Kumar February 2007
Lean Project Management
  Known
as “Lean Construction” when
applied to a production management
based approach to project delivery
  Extends from the objectives of a lean
production system – maximize value and
minimize waste
Dr Rumesh Kumar February 2007
Outcomes of lean project
management
  The
facility and its delivery process are
designed together to better reveal and
support customer purposes
  Work is structured throughout the
process to maximize value and reduce
waste at the project delivery level
  Efforts to manage and improve
performance are aimed at improving total
project performance
Dr Rumesh Kumar February 2007
Outcomes of lean project
management
  Control
is redefined from “monitoring
results” to “making things happen”. The
performance of the planning and control
systems are measured and improved
  Reliable release of work between
specialist in design, supply and assembly
assures value is delivered to the customer
and waste is reduced
Dr Rumesh Kumar February 2007
Outcomes of lean project
management
  Lean
Construction is particularly useful
on complex, uncertain and quick projects.
It challenges the belief that there must
always be a trade between time, cost, and
quality
Dr Rumesh Kumar February 2007
Example of a lean construction
  Sutter
Health USA is a system of non
profit hospital and doctors group based in
Sacromento USA
  It handles USD 5.5 billion of development
Dr Rumesh Kumar February 2007
Example of a lean construction
  In
a USD 100 million project, using lean
construction approach they were able to
◦  Cut the cost by USD 9 million
◦  Cut the time to completion by 6 months
◦  Mechanical, electrical and plumbing recorded
43 hours of rework out of 25,000 hours
◦  30% reduction in peak field labor
Dr Rumesh Kumar February 2007
Lean Principles
1. 
Precisely specify the value of each project
from the customers perspective .
2.
Identify the value stream for each project
3. Allow value to flow from customer demand.
4.
5.
Let the customer pull value from the project
team
Continuously pursue perfection.
Dr Rumesh Kumar February 2007
Value Adding Activities
In a Production/Construction Environment
40% value adding activity or support activity
60% waste
In an Information Environment
51% value adding activity or support activity
49% waste
Source: Cardiff Business School Lean Profit Potential
Source; Magna Business
Solutions
Dr Rumesh Kumar February 2007
Value
Add vs. Non-Value
Add
Value and Non Value
Added
Activities
WORK
PROCESS
ABNORMAL
NORMAL
NON-VALUE
ADDED
VALUE
ADDED
UNAVOIDABLE
FLOW
REDUCE
AVOIDABLE
ELIMINATE
Dr Rumesh Kumar February 2007
•  Upsets Customers
•  Chokes Flow
Waste #1 Rejects
14
Rejects
Over
Production
Inventory
Motion
Processing
Transactions
Transportation
Waiting
Rejects and wastes collected during construction
Dr Rumesh Kumar February 2007
Blocks the flow of work
Waste # 2 Over-Production
Defects
2
4
Over
Production
Inventory
Motion
Processing
Transactions
Transportation
Waiting
Do Not Produce What the Customer Does Not Need
Dr Rumesh Kumar February 2007
Waste #3 Inventory
Defects
Over
Production
3
4
Inventory
• Ties Up Working Capital
• Takes Valuable Space
•  Risk of Obsolescence
Motion
Processing
Transactions
Transportation
Waiting
Waste consumes space and resources
Dr Rumesh Kumar February 2007
Waste #4 Motion
Defects
Over
Production
Inventory
4
Motion
Motion
•  Ergonomic Concerns
•  Physical effort
• Wasted Cycle Time
Processing
Transactions
Transportation
Waiting
Extra work required – does not add value
Dr Rumesh Kumar February 2007
Waste # 4 Motion
Picking
Walking
Carrying
Any movement of people
or machine which does not
add value to the product
Placing
Stretching
Just
Watching
1
Dr Rumesh Kumar February 2007
2
Waste # 5 Transportation
This is what your striving for…
Defects
Over
Production
Inventory
Motion
Processing
Transactions
4
6
Motion
Transportation
•  Requires Equipment
•  Increases Handling Damage
•  Necessary…Must Minimize
Waiting
Machines Next to Each Other…Transport
Time Minimized
Dr Rumesh Kumar February 2007
Waste #7 Waiting
Defects
Person Idle at
Workstation
Over
Production
Inventory
Motion
Processing
Transactions
Transportation
4
7
Waiting
Motion
When Inventory Waits Your Customer
Waits
Dr Rumesh Kumar February 2007
Familiar ‘waiting’ scenes
Waiting for e-mail
from head office
Machine waiting
because of
breakdown
My machine has a
snag. Waiting for the
technician
Where is the
operator?
Waiting for raw material to
be supplied
Waiting for quality
inspector to
approve
M/c under
breakdown
Dr Rumesh Kumar February 2007
Steps in Waste Elimination
Understand what’s waste
Expose the waste
Eliminate it
Dr Rumesh Kumar February 2007
Types of Waste In Projects
 
 
 
 
 
 
 
 
Building ahead of demand/time
Waiting (people, material, information, for the next
operation)
Unnecessary transport (double handling)
Inappropriate processing (larger machines, unnecessary
steps, machines not quality capable, over design)
Material stocks (early deliveries, storage space,
deterioration)
Unnecessary motions (ergonomics, bending, reaching)
Building defective parts/sections
Waste of untapped human potential
Source; Magna Business
Solutions
Dr Rumesh Kumar February 2007
Waste in Current Project Management
Practice
Planning
  Gate Reviews
  Intermediate Deliverables
  Risk Management
  Project Reporting
  Progress Meeting
  Change Control
  Procurement
  Multi-Skilling
 
Source;
PMP
Professional
Dr Rumesh Kumar
February
2007