Lean Management in Construction Industry - Essay Example

The lean concept is much appreciated, tested and practised in industries like manufacturing, government, health care and other institutions. Lean in construction has been found to save costs and customers too increasingly prefer lean management of construction for cost savings. As there is much waste that is generated in the construction industry, implementing lean in the construction industry can yield cost savings and reduce lead times for the benefit of all. It also found that the present construction industry creates value at the rate of 10 percent while generating waste at the rate of 57 percent while in the manufacturing sector that implements lean, the reverse is true as it creates a value add of 62 percent and a waste of 26 percent (Sowards, 2012).

Lean thinking was first applied to car manufacturing services but later evolved to be applied to other manufacturing sectors and hence has been implemented in other industries as well. Lean implementation challenges traditional business processes to improve performance to give a competitive advantage to the business. The concept of lean thinking or management is defined as “the process of continuously eliminating waste in all processes and systems” and was primarily related to production. Henry Ford first introduced this concept in his company in the manufacturing segment and later adopted it into other segments like accounting and non-manufacturing operations. The Japanese saw lean as a method to superior manufacturing through quality improvement and later started adopting it in other areas of the business processes, with the efforts and success of Toyota drawing attention worldwide (Bottirov, 2011).

As other sectors including government and healthcare started implementing lean methods throughout the entire spectrum of business processes, the construction industry too started considering the advantages of lean management (Bottirov, 2011). As the concept of lean management has emerged from the production line, many of the practices, tools and techniques are readily available for implementation in manufacturing but construction being a different area than manufacturing, all of the principles and practices of lean production management do not fit into the construction industry, although there are many similarities in the processes of the two industry sectors (Salem, Solomon, Genaidy and Minkarah, 2006).

Apart from the works of Lauri Koskela and Glen Ballard and Greg Howell that individually offer an insightful but isolated understanding of lean in construction, other works have simply extended the works of these two to provide any concrete evidence of the relevance of lean in construction (Bertelsen, 2012). The study is still in its nascent stage and there is a lot of scope for study and improvement in this field. Further, relevant tools for the assessment of the performance of lean in the construction industry can be evolved through further research on the topic.

This section identifies the stages in a project and the challenges in operations management to improve productivity. A company or business involves itself in the production of goods or services to meet customer needs and the activities it is involved in the process are part of its operations management. This activity of creating products and services uses tools, techniques and concepts that aim to transform input resources into output products to be supplied to the end user. As operations management typically involves activities like production/manufacturing/operations, marketing and finance/accounting, concepts, tools and techniques of operations management are applied to achieve the desired outcomes (Operations and Productivity, 2012). Since Henry Ford identified that the desired outcomes can be achieved to increase productivity, the concept of lean management has been increasingly applied to production as part of operations management.