Application of lean to the bidding phase in building construction: A French contractor’s experience

Abstract

Purpose

While many procurement systems govern the construction sector, Design/Bid/Build is still prominent among the French building actors. The research applies Lean thinking (via a Kaizen event) to the bidding phase of a building construction company in order to improve its bidding outputs.

Design/methodology/approach

The method used in this study is “Action-Research”. A two-month preparation phase was needed to prepare for the kaizen event. The results were based on an assessment conducted after 6 months of the Kaizen event. Performance was measured following selected indicators related to ‘Time”, “Economical Impact”, “Quality” and “Sustainability”

Findings

The Lean implementation had positive side-effects on the company’s organization and strategy as well.

Practical implications

The findings of this action-research project can be used to help researchers and practitioners assess the potential application of Lean in the bidding phase. It also provides insights into the importance of the cultural and existing practices for a successful Lean implementation

Originality/value

A few research projects investigated the application of Lean thinking in bidding since it is considered as a wasteful process. However, waste can also be organized. The research proves that bidding can benefit from Lean thinking.

Full text

International Journal of Lean Six Sigma
APPLICAT
ION OF LEAN TO THE BIDDING PHASE IN
BUILDING CONSTRUCTION: A FRENCH CONTRACTOR’S
EXPERIENCE
Journal:
International Journal of Lean Six Sigma
Manuscript ID
IJLSS-03-2016-0010.R1
Manuscript Type:
Research Paper
Keywords:
Lean, Bidding, building construction, performance indicators, change
management
International Journal of Lean Six Sigma

International Journal of Lean Six Sigma
APPLICATION OF LEAN TO THE BIDDING PHASE IN BUILDING
CONSTRUCTION: A FRENCH CONTRACTOR’S EXPERIENCE
Zakaria DAKHLI
a,b
, Zoubeir LAFHAJ
b
, Marc BERNARD
b
a
Civil Engineering, Ecole Centrale de Lille, Address: Cité Scientifique, CS 20048, 59651, Villeneuve-
d’Ascq, France,
b
Rabot Dutilleul, Address: 10 Avenue de Flandre, 59290, Wasquehal, France
E-mail: zoubeir.lafhaj@ec-lille.fr (corresponding author)
Purpose – While many procurement systems govern the construction sector, Design/Bid/Build is still prominent
among the French building actors. The research applies Lean thinking to the bidding phase of a building construction
company in order to improve its bidding outputs.
Design / Methodology / Approach – The method used in this study is “Action-Research”. The paper is based on a
Kaizen event. Two-month preparation phase was needed before the kaizen event. The results were based on an
assessment conducted after 6 months of Lean implementation. Performance was measured following selected
indicators related to ‘Time”, “Economical Impact”, “Quality” and “Sustainability”
Findings –The Lean implementation had positive side-effects on the company’s organization and strategy as
well.
Practical implication – The findings of this action-research project can be used to help researchers and
practitioners assess the potential application of Lean in the bidding phase. It also provides insights into the
importance of the cultural and existing practices for a successful Lean implementation.
Originality / Value –Few research investigates the application of Lean thinking in bidding since it is
considered as a wasteful process. However, waste can also be organized. The research proves that bidding can
benefit from Lean thinking.
Keywords – Lean, bidding, building construction, performance indicators, change management
Article classification – Research paper
.
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International Journal of Lean Six Sigma
APPLICATION OF LEAN TO THE BIDDING PHASE IN BUILDING CONSTRUCTION:
A FRENCH CONTRACTOR’S EXPERIENCE
Purpose – While many procurement systems govern the construction sector, Design/Bid/Build is still prominent among
the French building actors. The research applies Lean thinking (via a Kaizen event) to the bidding phase of a building
construction company in order to improve its bidding outputs.
Design / Methodology / Approach – The method used in this study is “Action-Research”. A two-month preparation
phase was needed to prepare for the kaizen event. The results were based on an assessment conducted after 6 months of
the Kaizen event. Performance was measured following selected indicators related to ‘Time”, “Economical Impact”,
“Quality” and “Sustainability”
Findings –The Lean implementation had positive side-effects on the company’s organization and strategy as well.
Practical implication – The findings of this action-research project can be used to help researchers and practitioners assess
the potential application of Lean in the bidding phase. It also provides insights into the importance of the cultural and existing
practices for a successful Lean implementation.
Originality / Value –A few research projects investigated the application of Lean thinking in bidding since it is considered as
a wasteful process. However, waste can also be organized. The research proves that bidding can benefit from Lean thinking.
Keywords – Lean, bidding, contractor, buildings, Design/Bid/Build, cost, change management, performance indicators,
lean implementation.
Article classification – Research paper
.
1. Introduction
The current economic situation in France is characterized by a fierce competition among companies, especially in the
construction sector. Indeed, the investments made during the last five years have stagnated (Fig. 1). The number of residential
projects dropped significantly from 451, 9 thousands in 2005 to 311,7 thousands in 2012. The same decline was noticed in
non-residential projects (Fig. 2). As a consequence, construction costs increased during the last 5 years.
The employment was also affected since the decrease in demand. All those factors make the construction industry under
pressure in France due to the tight possible margin.
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Figure 1. Investments made in the construction sector in three different activities (adapted from INSEE
1
)
Figure 2. Residential and non-residential projects undertaken in France (Adapted from INSEE)
Since the number of projects undertaken is decreasing (Figure 2), contractors (CM/GC) try to innovate and to rethink their
approaches in order to stay competitive. For instance, (Ballesteros-Pérez et al. 2014) address the need to improve contractors’
bid by implementing a Smartbid BTFM (Bid Tender Forecasting Models) to estimate future competitor’s behaviours. (Ho &
Hsu 2014) Investigated the bid compensation theory and revealed the patterns behind offering a compensation to encourage
contractors to make extra-effort in their offering. Other studies explained the interactions between the different stages in a
1
Institut National de la Statistique et des Etudes Economiques collects, produces, analyzes and disseminates
information on the French economy and society.
0
50
100
150
200
250
2002 2004 2006 2008 2010 2012 2014
Investment (Billion euros)
Year
Sum of activities
Specialized construction
Buildings
Civil engineering
0
100
200
300
400
500
2000 2002 2004 2006 2008 2010 2012
Number of projects undertaken (thousands)
Year
Residential projects
Non residential projects
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construction project. (Parvan et al. 2015) pointed out the loss behind inefficient communication between the design and
construction phases. He stated that as much as 20% of variability in overall project costs is due to this design-construction
interphase.
The bidding phase operates as a link between the design and construction. If well undertaken, it can provides a significant
improvement for project outcomes. However, this phase is generally underestimated in the construction practice. This
research focuses on the enhancement of the bidding phase using the Lean theory via a Kaizen event with the purpose of
improving time, economic impact, quality and sustainability. Those indicators are described more in details in the “Research
methodology part”.
The next part (section 2 -6) concerns a literature research linked to the main concepts linked to the research project.
Afterwards, the next sections introduce the context of the study and the research methodology. Then, the ‘result and
discussions’ section presents the impact of the Kaizen event after 6 months of the Lean implementation in the bidding phase
of the contractor.
2. Lean theory
Lean management is a system that aims to generate value to the client while eliminating the waste in the value chain. Lean
concept emerged from Toyota Production System (TPS) in the 1950’s. TPS, initiated by Taiichi Ōno, was a major shift in
process efficiency following the mass production system established by Henry Ford (Liker & Meier 2005). “TPS” was seen as
a more flexible system that allows more control and change along production lifecycle (Marksberry 2011).
In 1992, Womack and jones studied the TPS system. They assigned it to the term “Lean” in their book “The machine that
changed the world”(Womack et al. 1990) and established a set of principles for Lean thinking (Womack & Jones 1996):
- Identify the value for the customer: be clear about what the client wants. Product characteristics should reflects the client
needs.
- Identify the value chain and eliminate wasteful processes: characterized by non-value added tasks: once the client
requirements are clearly identify, all the processes should be directed towards creating the value desired by the client.
Waste is associated to any activity that does not creates value for the client or any activity that is not necessary/needed for
value creation. Based on this definition, 3 types of activities could be distinguished: value added activity, activity
necessary for value creation and non-value adding activities.
- Create a continuous flow: the creation of a continuous flow is the next step once the process is mapped. The objective is
to set the production rhythm and to maintain a steady flow state.
- Seek a pull system based on the customer demand: Lean system is a pull mechanism where production is activated by the
client demand. Push systems where the production isn’t triggered by client demand generates waste in different manners
(inventory, over-processing, etc.)
- Set a continuous improvement process to seek perfection: Lean is about enhancing the system permanently. A continuous
improvement system should be included.
2.1 Kaizen
Kaizen is a Japanese term that stands for “good change” and is one of the techniques used in the LPS system. Kaizen events
are used to implement a continuous improvement by different companies. Over time, new standards and procedures will be
created and resisting the change will become harder (Ortiz 2009). According to (Suárez-Barraza & Rodríguez-González
2015), leaders of some business understand continuous improvement more formally as: ‘a continuous, incremental
improvement of an activity to eliminate waste, unevenness, and unreasonableness and create more value. Kaizen adds an
additional “human element” that all stakeholders, not just management, must be involved in such change (Knechtges &
Decker 2014).
(Ikuma et al. 2011) for instance presented a case study where a Kaizen event was used in a modular housing manufacturing
facility. The changes resulted in a 16% increase in value-added activities and increased the framing crew’s overall output by
55%.
In his article, (Forbes 2001) talks about the challenges of implementing a continuous improvement process in the construction
industry. He stated that: “One obstacle to the transformation is perhaps the disconnect between the ultimate customer, the
building owner, and the suppliers, that is, the designer and the contractor. In most enterprises the customer can readily
evaluate product or service quality through simple points of reference.
On the other hand, (Alarcón et al. 2005) presented a set of barriers to implementing a Lean philosophy in the construction
sector; lack of time for implementing new practices in the projects, lack of training, challenge to create organizational
elements, lack of self-criticism to learn from errors, respond to some deficiencies, low understanding of the concepts, low use
of different elements, inadequate administration, weak communication and transparency and lack of integration of the
construction chain.
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The challenge is that there is a lack of experimentations of the effect and outputs of Kaizen events (Suárez‐Barraza et al.
2011). This is more prevalent in the construction industry where Lean management is introduced slowly. In addition to that,
Kaizen events are generally engaged strategically with top management approval in processes identified as bottlenecks. In
construction, however, the stake is to identify those bottleneck in the value chain of construction, which is a difficult task since
the many stakeholders involved in the act of construction.
3. Lean Construction
After the noticeable benefits of lean theory in the manufacturing industry ((Khanchanapong et al. 2014; Belekoukias et al.
2014), lean was adopted by different sectors, among them: healthcare (Crema & Verbano 2015), I.T (Hicks et al. 2015). For
the construction sector, Koskela wrote about Lean Construction (LC) in 1992. He analysed in his report “Application of new
philosophy to construction”(Lauri Koskela 1992) the potential applicability of lean principles to the construction sector. In
1992, Koskela has reported the adaptation of Lean production concepts in the construction industry and presented a
production management paradigm where production was conceptualized in three complementary ways, which is known as
Transformation; Flow; and Value generation (TFV) theory of production. This tripartite view of production has led to the birth
of Lean Construction as a discipline that subsumes the transformation-dominated contemporary construction management (L.
Koskela 1992).(Howell & Ballard 1994) also contributed to LC genesis by stressing the crucial lack of collaboration.
Lean Construction community is composed of researchers as well as practioners striving to develop the construction sector:
visualization (Daou et al. 2015), pull planning (Kalsaas et al. 2015), prefabrication and modularization (Hermes 2015) are
some of the concepts integrated into Lean Construction, adapted and applied to improve the construction sector. The
prominent system of Lean Construction is the adapted production planning for construction called “Last Planner System”
(LPS®). They noted that only half of the planned actions are performed on site per week (Ballard 2000). The idea behind
LPS® is to master collaboratively work plan early in the project by putting together all the involved stakeholders (client,
constructors, subcontractors, architects…). Since construction is a “people” business where different construction actors
collaborate to design and construct, the LPS is an efficient way to foster communication in project team. LPS® is based on 4
integrated planning elements:
- Master schedule: provide an overall overview on project milestones,
- Phase plan: called revers Phase Scheduling. It is based on a pull planning where stakeholders design the project in a
reverse chronology.
- Look ahead Planning: It’s a six week planning with constraint analysis.
- Weekly Work Plan (WWP): preparation of next week work. WWP helps calculate the Planned Percentage
Completed (PPC) which describes the percentage of tasks accomplished in a certain week and track its variance
throughout project lifecycle.
The International Group for Lean Construction (IGLC) contains an extensive literature of the Lean Construction field of
research. IGLC was founded in 1993 and makes up a network of professionals and researchers in architecture, engineering,
and construction (AEC) who feel that the practice, education, and research of AEC have to be radically renewed in order to
respond to the challenges ahead (International Group for Lean Construction 1993).
Lean implementations are well developed in literature mainly in the form of case studies (Castillo et al. 2014; Yu et al. 2013a).
Another implementation types concern one aspect of lean management theory. For instance, (Suárez-Barraza & Rodríguez-
González 2015) focused on the role of kaizen in lean implementation and provided a set of lessons learned and good practices
for a successful kaizen approach. (Domingos et al. 2014) presented a Kanban system implementation. (Pheng & Chuan 2001)
evaluated the maturity level of contractors to adopt Just-In-Time principle applied to precast concrete components for on-site
delivery.
Finally, Lean implementation is considered as a change, thus, an implementation strategy is to be well developed before
action. People’s perception, involvement and empowerment is also required for a successful implementation ((Losonci et al.
2011). The cultural aspect is also well stressed for setting a suitable lean implementation approach (Knapp 2015).
4. Performance indicators in the construction industry
As stated by Peter Drucker: What gets measured gets managed. The concept of “Performance indicators” is key concept in the
Lean management philosophy (Al‐Aomar 2012). Indicators like “Inventory rotation”, “Work In Progress”, “Lead time” help
assess the current performance and keep track of what is meaningful to attain a desired objective: setting up lots of indicators
leads to confusion and difficulties to focus on what matters most. On the other hand, low number of indicators can be
challenging to identify a clear image in the current performance of the process.
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(Beatham et al. 2005) proposed three types of indicators: Key Performance Indicators (KPIs), Key Performance Outcomes
(KPOs), and perception measures. The first type of indicators provide the opportunity to act thus change the outcome of the
process before the finish. An example of a KPI is the binary indicator “adequacy of client need with the design”; it is possible
to act on the design before the actual construction. For KPOs, those are the outputs of the process and do not provide the
chance to change. “Actual delivery time” is an example of a KPO. Finally, Perception measures tell the perception of people
on a given process and they are generally carried out by direct question or survey (Horstman & Witteveen 2013) . An example
is “client satisfaction”.
Despite the large number of searches made in the construction sector is still proclaimed as the least effective and efficient in
all industries (Alinaitwe et al. 2009; Beatham et al. 2004).
The reason for the low productivity is the focus on financial rather than performance-based approach (Egan 1998). From this,
several companies began to develop performance measurement tools (1.5 billion £ for UK private companies) (Edwards &
Thomas 2005). Therefore, the construction should also replace the competitive market system standard based on short-term
financial gains, with a system based on transparent measure of the quality and effectiveness (Egan 1998). Indeed, the financial
perspective has received much criticism for not providing a true picture of the performance (Beatham et al. 2004; Beatham et
al. 2005; Kaplan & Norton 2000).
(Tam & Zeng 2013) introduced a set of sustainability indicators in the building construction as a response to the construction-
related legislations in Australia. They categorized those indicators into: “environment” and “social”. “Environment” related
indicators include: “ecological quality of construction area”, “emission of greenhouse gas”, “energy efficiency”, etc.. Social
indicators include but not limited to: “minimize cooling loads: building design, glazing section, lighting design, and
landscaping”, “separated regulation of interior temperature”, etc.
In the Lean Construction philosophy, the Last Planner System® introduced the Percent Plan Complete (PPC) indicator. It is
considered a reliable indicator of the construction performance since the number of research realized to support its relevancy
(Kalsaas et al. 2015; Issa 2013). This indicator describes a basic measure of how well the planning system is working. It is
calculated as the number of tasks completed on certain period of time (frequently during a week) divided by the total number
of tasks made for period. This indicator is generally related to the construction phase while the construction value chain starts
from (1) the client appointing the architect for design, (2) to the bid for construction companies and finally (3) the last step is
the construction. This research focuses on the bidding phase since no enough literature and knowledge regarding meaningful
indicators is explored.
5. Procurement strategies in the construction sector
Procurement systems describe how the project is going to be managed and executed. Thus, it is a crucial decision that has a
direct impact on the quality of the delivery.
Procurement system (or delivery method) is defined by (Masterman 2002) in the construction industry as “the organizational
structure adopted by the client for the management of the design and construction or a building project”. According to
(Mossman 2012), the construction sector delivers value based on six procurement systems.
- Design / Bid / Build: it’s the traditional delivery method characterized by a sequential process that starts with project
design established by an appointed designer (the architect). Once the design is finished, the contractor is selected
using some criteria (price, technical feasibility, sustainability). However, the main criteria of selection usually is the
price. This phase is called the bidding phase. The selected contractor can begin the construction with a complete
design and clear schedule.
- Design / Build: this type of procurement system is characterized by the signature of one single contract for the client.
As a consequence, the owner deals with only one entity for the design and the realisation of the project. The entity is
in charge of all aspects of the project.
- Construction Management agency: the contractor is selected based on his qualification. He is generally an expert and
give consultancy to the owner to manage the project. Indeed, all the contracts are set between the client and the trade
contractors. This configuration is the least comfortable for the client because he takes responsibilities for all the
aspects of the project including the scheduling, cost overrun, errors...
- Construction Management at risk: the client secures the services of a construction manager to work with the design
team and the trade contractors as well. However, in this configuration, the risk is now taken by the construction
manager. The latter is responsible of the project success according to the design fixed with respect to the schedule
and the budget.
- Public Private Partnership: this type of procurement system concerns offers provided by the public sector designated
to the private sector. The contractor is in charge of the construction, maintenance and management of the public
work. The contractor can receive direct payment from the public partner or he can use the public installation
(example: highway) for a certain period of time as a payment method.
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- Integrated Project Delivery: IPD is the “lean project delivery” method in construction. It consists of the integration of
all parties involved in the early project phase. IPD is based on close collaboration in order to generate the maximum
added value to the client. Thomsen et al. described the differences between the traditional construction method of
leading a project and IPD system. The traditional construction project is organized into three “camps” with diverse
interests that sometimes converge and other times are opposed: owner, designer and contractor. Project participants
come into their camps at various times during the project, with designers coming on early, construction managers (if
any) coming on in mid-design, and general and trade contractors coming on after design is substantially complete
(Thomsen et al. 2009). Thus, IPD tries to minimize “the fragmentation” issued by the traditional methods (Figure 3).
Figure 3. Construction procurement systems in the construction sector (Mossman, 2012)
Finally, procurement systems can also refer to parts of the construction processes. For instance, (Yin et al. 2014) investigated
the relationship between contractors and subcontractors by studying and improving its procurement system.
6. The Bid
D/B/B (Design/Bid/Build) is a common procurement strategy used in construction projects mainly due to: insufficient
knowledge of others procurement methods, D/B/B is considered as a “safe solution” for the client since the non-respect of
project cost and schedule is generally attributed to the contractor, market nature and readiness, the habit of using D/B/B by the
client. Different studies investigated the differences between D/B/B and others procurement methods. (Idoro 2012) compared
D/B/B with Direct Labour method and concluded that the mean level of planning done at the design stage in projects procured
by D/B/B method is higher than that of projects procured by Direct Labour method. (Francom et al. 2015) described
“Alternative Project Delivery Methods” (APDM) to the trenchless pipeline industry. The authors found that the most common
delivery method used in the pipeline industry is D/B/B. The latter prevents from a continuous project flow due to the lack of
technical knowledge exchange between the design engineers and contractors. (Ling et al. 2004) compared D/B
(Design/Build) and D/B/B. Since those two procurement systems are organized differently, they have different benefits and
drawbacks. The authors also developed a model to predict D/B/B and D/B project performances.
Bidding is the underpinning phase for a sustainable activity for contractors. The first reason is that bidding in construction is
still not fully controlled and suffers from a great variability, uncertainty and subjectivity (Chua et al. 2001). Indeed, there is no
systematic approach to bidding since every construction project is different and requires an engineered approach to solve (thus
bid) on the implementation solutions for construction (Laryea & Hughes 2011). The second reason is that winning bid is the
tunnel for a continuous activity for the construction company; without enough projects going from a winning bid to the
construction phase, contractors’ survival is at risk in the mid-term vision (since workers wait for work). If a bid is won, it
means a continuous activity during the construction project duration, which varies from few months to few year depending on
the building project size. In contrast, a lack of successful bids translate into (1) construction managers waiting for work and
(2) more risk for the company’s mid-term source of revenue. The importance of the bidding phase is thus capital for the
company in the context of a buyer’s market.
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In a D/B/B configuration, the client communicates the selection criteria. In many cases, a large weighting is associated to the
price. For the studied construction company in this research paper, its bidding is generally associated with:
- 60% to the proposed price.
- 30% to the technical value of the project: it includes constructability, feasibility and the organization set in place.
- 10% to sustainable development, mainly the suggested procedures for protecting the environment (material used, onsite
construction noise, etc.).
Once the contractor is selected, the client’s expectation is that project would follow the fixed design and schedule proposed in
the bid. However, literature reveals that the majority of D/B/B projects are run over budget and schedule (Parvan et al. 2015).
While some research projects deal with the bidding phase (Gurcanli et al. 2015), less focus is directed towards the bidding
phase as a research thematic in the construction research community. In addition, existing literature provides no guidance on
how to improve this transition phase between design and construction. The aim of this article is therefore to address this gap
by experimenting a first Lean implementation via a Kaizen event for a contractor’s bidding phase.
The next part of this paper presents the context of the study and the research methodology. Then, the ‘results and discussion’
part is divided into two sections: the first section presents the current practices and culture embraced by the contractor in order
to facilitate the Lean implementation. The second section evaluates the impact of the implementation thanks to a selection of
adequate key performance indicators.
7. Context of the study
The study concerns a construction enterprise (1266 employees) specialized in building construction. It is a familial company
created in 1920. The construction company acts as a contractor that can undertake mainly three construction activities:
- Public facilities.
- Rehabilitation.
- Private Real estate development.
The construction company proceeds using 3 different delivery methods:
- Design / Bid / Build
- Design / Build
- Public Private Partnerships PPP (small number of operations).
Many projects are established following a D/B/B procedure in the company studied. The turnover related to each delivery
method is as follow:
- 70% for D/B/B.
- 13% for D/B.
- 17% for PPP.
This repartition is due to the strategy taken, but mostly, the French market conditions that generate many opportunities related
to the D/B/B practice.
In the conducted research, the focus is on improving the bid of D/B/B of the three construction activities: Public facilities,
rehabilitation and private real estate development using Lean thinking.
7.1. Research question
This study concerns the investigation of the bidding phase generated from a D/B/B delivery method. In this scenario,
contractors can act only during the Bidding and the Building phases. The Building phase is then a consequence of a successful
bidding.
The current building industry in France is set in a way that D/B /B is the main source of value creation for contractors. Taking
into account this information, the research question was formulated as follow:
How can contractors benefit from Lean thinking to enhance D/B/B project outputs?
7.2. Research Scope
The research draws the effect of the Lean implementation on the bidding phase inscribed in the (Design/Bid/Build)
configuration. D/B/B is followed by three activities of the construction company (Public facilities, rehabilitation, and private
real estate development). According to (Jina et al. 1997), classifying products in three categories : runners, repeaters, and
strangers helps identify where the focus should be concentrated for improvement initiatives. “Runners, repeaters, and
strangers” is a planning and control classification based on the frequency with which a manufacturing operation is called upon
to make a product or deliver a service (Slack 2015). In the case of the conducted research, “Design/Bid/Build” are the runners.
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The French market is more focused on this type of project delivery system (Dakhli & Lafhaj 2015). “Design/Build are
repeaters. Finally, strangers could be assigned to PPP projects since they are very occasional.
The conducted research draws the performance of the bidding phase of the three activities: “Private Real estate development”
“Public facilities” and “rehabilitation”.
8. Research methodology
In their research, (Pekuri et al. 2014) stated: ‘While there is no cookbook capable of explaining exactly how lean can be
applied in a way that maintains the fit among the elements of an existing business model while developing it as a system‘.
They also argue that Lean could be considered as a viable business model a company can envision.
In this research, Lean was applied in the context of a change that aims to improve the bidding performance. The application
was in the form of a kaizen event that was prepared following the steps described in Table 1.
A Two-month preparation phase was needed before the kaizen event. Four steps were included in the preparation phase.
The first step is “Current practices and culture identification”. Discussions with bidding managers helped list the current
practices that should be taken into account when implementing the Lean change.
The second step is “Formulation of the targeted objectives”. Objectives were set in conjunction with the construction
company in the form of performance indicators related to time, economical impact, quality and sustainability. While there is
no previous data on the current performance of the bidding department for benchmarking purposes, targets were set based on
the senior bid manager’s experience.
In the third step, data were gathered (process charts, organization and all the necessary information) to draw the current
process followed in to bid. The forth step was to map the current state (the future map will be discussed later in the paper).
Steps 5 to 7 were realized during the Kaizen event. The latter lasted one week and involved 15 collaborators from different
departments (from the bidding department, supply department, Quality service, onsite construction managers, and the
researcher) in order to give different insights and point of views for the enhancement of the bidding phase.
During the Kaizen event, problems with the current process were discussed and constraints were identified. This led to the
next step “Mapping the future state”. (The scope of this paper doesn’t include listing and discussing the Kaizen event in
details). The last step was to set the improvement actions generated from the kaizen event. According to Table 1, the Lean
approach was initiated within the “bidding department” using three features:
- Value Stream Mapping (VSM) and process lead time analysis.
- A Kaizen approach for a sustainable improvement.
- Problem solving techniques.
Performance was measured based on selected indicators from step 2. Those indicators are described in the next section.
Performance indicators were monitored and presented after 6 months of the Kaizen event in the “results and discussion”
section. The results were based on an assessment conducted after 6 months of Lean implementation with a total of 45 bidding
operations.
Table 1. Lean implementation steps in the bidding phase.
N° Step Description References to support the step
Kaizen
preparation
(Before the
kaizen event)
1 Current practices and culture
identification
How the company proceeds. Its
values and core beliefs.
(Bortolotti et al. 2014; Knapp
2015)
2 Formulation of the targeted
objectives
Measured indicators to track. (Nakhai & Neves 2009)
3 Data gathering Organisation chart, process sheets. (Bhamu & Singh Sangwan
2014)
4 Mapping the current process The process that leads to creating
value for the client.
(Basu & K. Dan 2014;
Hubbard 2014; Kaplan &
Norton 2000)
Kaizen event 5 Problems, constraints and waste
identification
Ishikawa diagram, 5why’s (Mao et al. 2009; Khisty &
Khisty 1992)
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(During the
kaizen event)
6 Mapping the future state of the
process
New process was drawn (Yu et al. 2013b)
7 Setting up improvement actions “Continuous improvement” is one of
the pillar principles of the lean
theory.
(Kale & Karaman 2012;
Yeung et al. 2013)
The method used in this study is “Action-Research”. This type of research methodology falls into the applied research
category. It is characterized by the integration of the researcher within the working group that aims to change the system.
In their book, (Fellows & Liu 2009) quote some requirements related to the methodology given by (Henry 2000) :
A trust-based relationship…..built up beforehand…accepted by all parties…
The researchers will have fully accepted the firm’s or institution’s objectives for innovation or change by having negotiated
the extent to which they will be involved and their freedom as regards access to information and interpretation.
A research and innovation project will be jointly drawn up, which must be open ended with regard to the problems to be
explored, but very precise in terms of methodology…’
The researcher was involved in the implementation plan and was considered as any other company’s employee. Thus, his
inputs were considered equivalent to any other collaborators regarding the three deployed features (designing the future state,
identifying problems with the current process and establishing the adequate measures for improvements).
9. Results and discussions
The results were based on an assessment conducted after 6 months of Lean implementation with a total of 45 bidding
operations.
Those operations are related to 3 bidding departments (operation types):
- Public facilities.
- Rehabilitation.
- Private Real estate development.
9.1 Current practices and culture identification as a key enabler of the lean
implementation
According to (Gregory A. Howell 1999), human issues play a crucial role in the lean implementation success. While there is a
lack of previous lean implementation experiences in the French construction industry, some key aspects were taken into
accounts:
- Involvement of Top Management
- Skills and training provided
- Team work and involvement of collaborators.
In their study, (Bresnen, M., Goussevskaia, A. and Swan 2005) focused on change initiatives that involve a disruption in the
existing processes and knowledge. Most of those initiatives fail due to the high change impact generated among collaborators.
Before starting the Lean approach, the company’s history was reviewed and integrated within the implementation process. 5
criteria were identified.
1. Avoid adding another ‘tool’ (as a solution) to managers.
Records show that the company knew dozen of tools, provided as a solution to enhance performance. Thus, the output of the
Kaizen implementation shouldn’t be another “tool or software” proposition but a real process change. The lean approach must
be directed towards process improvement.
2. Avoid wheel reinvention.
The current context of the French construction market requires actors to think outside the box to make the difference. Every
collaborator is aware of this fact. When presenting the lean approach, it shouldn’t be presented as a way of reinventing the
existing business but adapting it to the current situation. Generally, people assign negative connotation when obliged to start
from scratch and reinvent everything. Lean is about adaptation to the client point of view by enhancing the actual system not
reinventing it.
3. Simplicity.
After few months in the company, one can easily notice the strong presence of a result-oriented mind-set. Simplification is the
key word.
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Lean approach is about eliminating waste. As a consequence, the process becomes simplified and contains only the essentials.
The fact of knowing this information increases the chances of the Lean approach success by identifying the triggers that
challenge the employees to participate actively.
4. Translating “Lean” terminology into the company’s jargon.
Words are powerful. Using them in the right purpose can make considerable change in the final outcome.
Lean terminology should be replaced by the local vocabulary. It allows employees to appropriate the Lean philosophy. For
instance, the Lean approach could be translated into “an approach to empower collaborators to give the best value to the
client”. In addition, every Lean methodology or tool should be backed by a clear goal definition.
5. Employees first, then the client.
One of the key criteria of Lean implementation success is employee’s involvement and full appropriation of the Lean
methodology. To guarantee this, focus should be put in explaining the benefits gained by the employees from Lean adoption
during the first implementation. Afterwards, focus should be directed slowly towards the final client. By doing so,
collaborators will be aware that the Lean methodology is here to empower them to give the best value to the client (the one we
bid for) (Figure 4).
Figure 4. Lean implementation: focus shift
9.2 Assessing the benefit of the lean approach
With the purpose of evaluating the benefits of the lean approach, the impacts were defined according to (Ebbesen & Hope
2013) findings. The project management triangle (cost, time, quality) isn’t the best representation of the project success.
(Ebbesen & Hope 2013) suggested new models where the triangle is guided by sustainability. Many attempts were conducted
to elaborate the best fit of sustainability within the project management triangle: for instance, the star-model in Fig. 5
developed by (Grevelman & Kluiwstra 2010).
Figure 5. Sustainability integration in the project management triangle (Grevelman & Kluiwstra 2010)
9.2.1 Performance indicators selection
The impacts were explored according to the established indicators in step 2. Table 2 summarizes the indicators monitored in
this study and their subparts. For “time”, we tracked “Lead time of the bid”. “Economical impacts” is composed of three
subparts: Earned Value Method, productivity and exploring alternatives. Each one has a performance indicator. For “quality”,
it contains two subparts: Kaizen and variability control. Finally, “sustainability” is divided into “People” (how bidding
operations are assigned to people?) and “strategy” (choosing the right strategy for the bid: quick or detailed bid).
Targeted performance values were established according to senior bid managers’ experience since no previous records were
available. Those values are supposed greater than the current performance of the existing processes.
Focus directed towards collaborators
Full
appropriation by
collaborators of lean principles
Focus directed towards the client
Initiation of lean principles
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Table 2. Performance indicators selected to track the Lean implementation.
Subpart Performance indicator
Time
Lead time of the bid
Economical
impact
Earned Value Method Cost variance between the planned value and actual cost of the bid
Productivity Manpower/operation
Exploring alternatives Operation Cost reduction using alternative design
Quality
Kaizen Number of improvement ideas and actions
Variability control
Cost variability
(before
/after technical review)
Sustainability
People Operation assigned based on competences “skill matrix”
Strategy Adding “quick estimation” part in the existing process
9.2.2 Time
One of the targeted improvements is bidding lead time reduction (Fig. 6). If a bid takes more time than needed, the bidding
team (structural and secondary trade bid managers, senior bid manager) is mobilized while other bids could be started.
Figure 6. Lead time in the bidding phase, input and outputs.
“The team used a modified Value Stream Mapping (VSM) to draw the biding process. The reason is that a manufacturing
process (a production process) is different from a bidding process. The latter requires a specific legend to best describe its
complexity “repetitive tasks, on demand tasks, etc. see Figure 7.a).
Using the modified Value Stream Mapping (VSM) (step 4 in Table 1), the current bidding process contained more than 150
tasks (This was realized thanks to step 3 “Data gathering”). The Kaizen event helped rethink the bid and draw a new mapping
(Figure 7.b). The future process is now composed of 72 tasks and was divided into 3 phases as follow:
- Phase 1 “Launch of the project”: it is the first phase of the process and its objective is to assess and give the “yes or no” to
bid on the selected project. The phase is composed of 19 tasks.
- Phase 2 “Project study”: once the project is confirmed, it is studied in details. The “Project study” phase of the process
contains 44 tasks (from consulting sub-contractors to worksite visit, etc.). This phase ends when the price and technical
feasibility (bidding process outputs as showed in figure 6) are validated.
- Phase 3 “Finalization”: the last phase of the process is activated if the bidding is successful. The construction company
proceeds the administrative work with the client. The process finishes when the bidding team receives feedback about
their estimation from onsite construction team at the end of the construction. This phase contains 9 tasks.
The application of the modified VSM helped distinguish 3 collaborators responsible for conducting the bid (structural bid
manager, secondary trades bid manager and senior bid manager). The blank rectangle in figure’s 7.a legend means that other
people are responsible for doing the task (commercial sale, technical study manager, etc.). Their respective tasks were clearly
described: task sequencing, time slot if fixed, the necessary tools and support to achieve the task and a comment area (Figure
8). In addition, interactions with other company’s department were identified. Finally, repetitive task for each project were
(worksite visit for instance) and on-demand task (meeting requested by the responsible of the study) were highlighted.
Bidding process for
construction
(D/B/B)
Project selection Price
Technical feasibility file
Lead time
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Figure 7. a) A drawing of the bidding future process b) modeling of the drawn future process
Autre
Impact Bénéfices, Efforts
Tâches Chargé d’études
Tâches répétitives Tâche à la demande
Tâche Chargé de Groupe
- Arbitrage David
LECHANTRE au début du
COCO (Lundi 14h à 14h30)
- Fiche d’identification
remplie par le commercial
Diminuer les réunions
« Informations » à 2
maximum
La fiche d’identification
réalisée par le commercial
pour présentation à
l’arbitrage
Réunion D.L avec les
chargés de Groupes
-> C. R. live
Lundi à 17h
Réunion CG et CE
Transmission des
informations échangées
Vérification des pièces,
tirage et prise de
connaissance du dossier
par le C.E.
Lecture en diagonale lors
de la prise de
connaissance du dossier
Lecture diagonale du
dossier par le C.G + points
de surveillance / Critique
Estimation rapide par le
C.G sur la base de ratios
Réalisation par le C.E
- Planning des études
- Coût de l’étude
- Fiche processus
(hors fiche identification)
(y compris matrice des
risques)
Réunion de lancement
CE + CG + Commercial
-> Validation des coûts
-> ASAP fait par étude
commerce
Trame Mémoire technique
fait par l’assistante
Intégrer besoin planning
au lancement
Logement:
Chiffrage rapide par
POLO
Processus à définir
Consultations et choix des
prestataires et métreurs
par le C.G + envoi des
documents
Suivi des honoraires par le
C.G. validés par le
directeur de Pôle
Lecture détaillée + ASAP
(onclusions)
Réunion avec les
prestataires et échanges
sur les variantes à
l’initiative du C.E
Orientation des choix
constructifs
A l’initiative du C.G.
Brainstorming des
variantes
Rédaction des questions
Point avec le commercial
pour reformuler ensemble
les questions à envoyer
Réunir ensemble le
commercial et le C.E et
envoyer les questions sans
intermédiaire
Liste des sous-traitants
(GO+ CES) et prestations
spécifiques
Constitution des dossiers
de consultation
Prise de contact avec les
ST spécifiques Envoi des dossiers
Variantes (GO + CES)
Etablir liste à transmettre
au commercial
Validation des variantes
par le commercial dans
les 48 h
Visite du site + établir la
fiche de visite
Elaboration et rédaction
du mémoire technique
basée sur la trame
réalisée par l’assistante
Mémoire technique :
gestion d’une base de
données par thème
Point intermédiaire à la
demande du CE avec le
commercial
Point intermédiaire avec
les prestataires
(A la demande des
prestataires)
Méthodes réalisées par le
C.E
Préparation du D.Q.E GOTrame EDP dans PROGAP
Réception éléments
Méthodes (PIC + BBA)
Point de pilotage avec le
C.G
Planification et suivi du
planning d’études
Recalage suite au point
Réception métrés GO et
traitements
Saisie DS GO
Outil REHA de chiffrage
GO sur feuille Excel
Consultation service
achats
Amortissement et calcul
T.U
Valoriser les variantes
G.O
Retour consultation et
analyse ST GO
Mise à jour des DS avec
prix unitaires ST GO et
achats
Renseignement DPGF GO
+ assemblage CES Saisi FC PROGAP
Ajustement du mémoire
technique + envoi
assistante
Autocontrôle de l’étude
GO Feuille de vente
Passage en TSE (liaison
Internet)
Préparation des
documents de bouclage
Bouclage technique C.E/
C.G sans le commercial Recalage étude
Recalage documents
présentation bouclage
commercial
Bouclage commercial
avec seulement une
personne des études
Modification feuille de
vente sur EXCEL
Modification de la feuille
de vente sous Excel au
lieu de PROGAP lorsque
le prix du débours est fixé
DQE GO + CES en vente Finalisation du mémoire
technique et HQE
Transmission du mémoire
à l’assistante pour mise
en forme
Préparation de l’offre par
l’assistante
Relecture de l’offre (CE +
Commercial) Signature de l’offre + AE Copie de l’offre Dépôt de l’offre Imputation HORED Question clients / offre +
réponse CE
Relecture des réponses
par le commercial + envoi RDV client Recherche optimisation,
variantes, chiffrage
Mise au point dossier
marché
(Correction, analyse,
relecture)
Point commercial / EDP
Chiffrage variantes
Fiche chantier envisagé
Signature marché
(Commercial et CE)
Préparation passation
travaux
Passation travauxRevue de conceptionC.R. revue de conceptionRetour budget travaux
Préparation du DQE CES Réception métrés CES Chiffrage des CES à partir
des devis traités
Envoi des métrés au ST
spécifiques
Relance des ST
spécifiques
Réception des offres
spécifiques
Analyse des CES
spécifiques et tableau
comparatif
Valoriser les variantes
CES choisies avec le
commercial
Transmission des
montants des CES pour
remplir la feuille de vente
Future map state of the bidding service
On demand task
Repetitive tasks
Impacts of
the change
Structural
Bid
manager’s
task
Senior bid
manager’s
task
Task done by other collaborators
(technical studies, subcontracted, etc.
Phase 1
Phase 3
Phase 2
b)
Secondary
trade bid
manager’s
task
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Figure 8. Example of a task identification
Figure 9 presents lead times of the bidding process of 45 projects after 6 months of the Lean implementation. Lead times
range from 15 to 27 days and the targeted performances from 29 to 36 days. Overall, a clear lead time reduction is noticed in
all operation types. This result is expected since the new bid process resulted in a 46% task reduction in the bidding phase.
About 24% lead time reduction for public facilities, 49% for rehabilitation and 28% for private real estate development. In
rehabilitation projects, the improvement is more effective. Rehabilitation is a relatively new market for the construction
company. Thus, its process is under development, which explains its high variability.
Figure 9. Lead times of the bidding process of 45 projects after 6 months of the Lean implementation
0
5
10
15
20
25
30
35
40
Public facilities Rehabilitation Private real est.
Lead times of the bidding process
after 6 months of Lean implementation (days)
Type of operation
Targeted performance
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9.2.3 Economical impact
Not only did Lean philosophy improve the bidding phase productivity but did introduce a new concept that help practioners
track project progress and control budget dedicated for each operation.
Earned Value Method application
One major constraint cited many times by collaborators is the difficulty encountered to “act” before “it’s too late”. Many
times, collaborators engage in a bidding operation that consumes time, on average one month, before finding out that budget
was exceeded. For this reason, Earned Value Method was initiated.
EVM is a technique of performance measurement focused on the interrelationship between the project physical, financial and
time progress, indicating planned and actual performance with the purpose of establishing corrective measures (Ponz-Tienda
et al. 2012). However, according to the research of (Kim & Ballard 2002), EVM is an effective tool only under the limiting
assumption that every activity or cost account is independent. Since the objective of the “economical impact” indicator is to
monitor cost provided for bidding, EVM was tested and the results drawn.
Figure 10 represents cost variance between the planned cost and the actual cost of bidding after 6 months of EVM
implementation. The planned value means the established cost of the bid the company managed to provide. It includes: bid
manager and senior bid manager costs, technical studies costs, and Building surveying services.
A decrease in cost variance between the planned cost and the actual cost of bidding was noticed. The cost variance ranges
between -7% and +0.78% after 6 months of EVM implementation. A negative cost variance means savings in the bidding
budget. While there are savings in the private real estate development and public equipment, rehabilitation operations
performs better due to the closeness to the targeted performance. The objective is to eliminate cost variance when setting the
initial budget for each bidding operations. The reason that cost variance is positive for rehabilitation projects (which means
that the initial budget fixed for the bid was exceeded) is that this expertise is relatively relatively new compared to the other
two since rehabilitation is a new market.
As a conclusion, the lean implementation resulted in substantial budget savings (cost variances are negative except for
rehabilitation projects). However, the process suffers from a certain variability that should be tracked and eliminated over
time.
Figure 10. Cost variance between the planned value and the actual cost of bidding after 6 months of EVM
implementation.
Increase in productivity
Productivity was assessed using the number of men mobilised per bidding operation as an indicator.
Targeted performance zone
[-2:+2%]
-8
-6
-4
-2
0
2
4
Public facilities Rehabilitation Private real est.
Cost variance (%) after 6 months EVM implementation
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Figure 11 expresses the indicator Manpower/operation (how many people are mobilised for the bid) according to operation
types and the targeted performance. For public equipment, an average of 1.33 men were mobilized. The lowest value is
attributed to the rehabilitation operations with an average of 0.78 men/operation. Finally, the private real estate development
required on average 1.28 men/operation.
The decrease in Manpower/operation is due to process documentation, collaborative rethinking of the bidding phase and lead
time reduction.
Figure 11. Manpower per operation after 6 months of lean implementation.
Exploring alternatives to offer value to the client
Applying lean thinking to offer competitive advantage during the bidding phase was also explored through “la culture de la
variante”. The latter is in the form of a brainstorming session where bid managers share ideas to modify slightly the operation
design in order to reduce cost and to give the client (final client, who will select the construction company) new perspectives.
Those brainstorming sessions were added to the new bidding process.
Many researchers study the effect of collaboration and information sharing on a construction project success. In their article,
(Kang et al. 2012) focused on the obstacles encountered in sharing information knowledge. Many benefits are expected in the
construction phase according to (O’Connor 1985) findings : construction time reduction, effective use of manpower…
The conducted brainstorming sessions led to changes in design through the exploitation of:
- Structural alternatives: enhancement in the structure of the building.
- Sustainable development alternatives : add sustainable design to the project
- Contractual alternatives : for instance, proposing special contract to sub-contractors to reduce cost
- Architectural alternatives: it involves changes in all the construction architecture including: doors, millwork, wall
and soil finishing, etc.
- Technical alternatives: Electricity, heating system, plumbing…
10 operations benefited from brainstorming sessions to generate new design improvements alternatives to propose in the bid
for the client. The results are given in Figure 12.
0
0,2
0,4
0,6
0,8
1
1,2
1,4
Public facilities Rehabilitation Private real est.
Manpower/operation after 6 months
Targeted performance
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Figure 12. Cost optimization using "brainstorming sessions" to find alternatives.
As a consequence of this type of collaboration, the bid provided by the contractor decreased by 5,12% in Public equipment
tenders. In rehabilitation, alternatives proposition reduced the bid by 4%. Finally, in Private Real Estate Development, the
benefits are quantified at 1,56%.
The application of Lean thinking initiated “une culture de la variante” which could be translated into “a culture of
alternatives”.
9.2.4. Quality
Kaizen
The Lean initiative resulted in 21 change ideas undertaken that aim to eliminate waste throughout the value chain. Those ideas
are developed in 48 actions assigned to collaborators (Table 3).
Table 3. Number of ideas and actions developed via the Kaizen approach.
After Lean implementation After 6 months of lean implementation
Improvement ideas 21 15
Actions 48 17
A Kaizen system was designed with the purpose of sharing knowledge and best practices among collaborators. The effect of
kaizen approach in the bidding phase was previously assessed by (Abdul-Rahman et al. 2012).
The system helps generate new project design variants for the final client with the purpose of improving constructability and
cost. Every Tuesday morning and for one hour, collaborators of the bidding department gather to share insights and give
feedbacks on a particular ongoing project by providing improvement ideas. Afterwards, the ideas are collected and
capitalized.
This model help collaborators launch a continuous improvement approach to the bidding phase. Among the benefits: an
increase in pricing accuracy, more realistic estimates and better evaluation of risks associated with tender.
Variability decreases in the bidding process
The process of the bidding phase comprises two essential meetings before submitting the final bid (Figure 13). The first one is
the “technical review meeting” followed by the “commercial review meeting”.
0
1
2
3
4
5
6
Public facilities Rehabilitation Private real est.
Operation cost reduction (%)
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- Technical review meeting: the objective is to provide final changes in the technical feasibility to reduce the
suggested bidding price.
- Commercial review meeting: it’s the last meeting before the bid validation. It requires the presence of one
commercial and the structural bid manager. The aim is to validate the final project bid.
Figure 13. Technical - Commercial review meetings process
A variability indicator was proposed: “bid price variability before/after technical review meeting”. Records of the proposed
indicator before the Kaizen event weren’t registered. This indicator assesses process variability of the bidding phase. Figure
14 presents bid variability of 45 operations undertaken after 6 months of the Kaizen event. The suggested bid before the
technical review was reduced by -1,55% in the public equipment department, -2,22% in rehabilitation and -3,34% in private
real estate development. The greater absolute value of cost variably, the unstable is the process. Indeed, a great absolute value
means many changes occurred between the technical and the commercial review meetings thus the process is inefficient.
The reason behind this result is that the new bidding process enables bid managers to fix meetings (whenever it is necessary)
with the project sales representatives to get his inputs on the client needs. Those tasks are assigned to “on demand tasks” in the
modified VSM (see figure 7.a).
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Figure 14. Bid price variability according to operation types.
9.2.5. Sustainability
People: Competence management to foster collaboration
The previous method of bidding consisted in affecting bid managers to project according to their availability. This method is
easy to use and doesn’t require many decision-making factors. However, competencies aren’t well used. As a consequence,
value loss for the final client is inevitable.
The system was modified. Projects were assigned based on expertise not availability. In addition to that, competencies of each
employee were collected in order to generate more collaboration using “skill matrix”. Each collaborator can inform his level
of expertise according to several criteria:
- Operation type.
- Previous projects undertaken and experiences.
- Tool development and optimization.
- Technical skills: structure, engineering, construction, etc.
- Competencies could be soft or hard skills.
Strategy: A value-based approach to rethink the bidding phase
Sustainable business is a direct outcome of a long term operations established by strategic orientations.
Lean thinking could be viewed as an operational enabler thanks to its tools and practical methodologies. It also could be
viewed as a strategic enabler by considering the only value added the one formulated by the client (internal and external).
Thus, strategy could be declined based on maximizing added value outputs.
The company’s archive revealed that bidding was always done in details. As a consequence, great amount of time is needed to
provide a final price.
In some cases, detailed tendering leads to a price out of the client’s ball parking zone. Time is lost doing non value added
activities for a large amount of time (one month or more). To address this issue, a quick estimation step was added to the
bidding process (Figure 15).
-4
-3
-2
-1
0
1
2
3
Public facilities Rehabilitation Private real est.
Bid price variability (%)
Targeted performance
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Figure 15. Integration of quick estimation in the bidding phase
Quick estimation was a Lean strategic move. It takes few days to assess project feasibility by using ratios for quick estimation.
It allowed eliminating waste in time, over-quality and competence waste: by engaging employees in a project that has no
value added for the client (the final price isn’t in the ballpark).
Implication of the “Sustainability factor” on the bidding process
“Time” and “Economical impact” indicators have a direct impact on the short term performance of the bidding process.
“Quality” indicators on the others have a medium term impact on the performance. “Sustainability” indicators set the
foundations for a sustainable performance for the bidding process.
Selecting the right team for the right project helps empower project team by fostering collaboration. People are less likely to
complain about their colleagues due to lack of competencies for instance.
Finally, having a clear strategy for bidding (not bidding the same way for all the projects) help reduce risks and enhance
greatly the chances of securing a certain amount of activities in the long run.
9.3. Research validity and limitations
The validity of the research depends on three criteria: internal validity, external validity and reliability (Johnson 1997; Bashir
et al. 2008). The first criterion could be translated into the following question: “Is what we're intending to
measure actually being measured?”. Our research measured the impact of the Kaizen event based on factual indicators
collected that best describe the initial objective set for the Kaizen event.
The second criterion is equivalent to the question: “Is what we're actually measuring applicable to the real world?”. The
conducted research is practical and is experimented in a professional context (real world).
The last criterion could be answered through the question: “If we did this study again, would we get the same results?”. The
research was conducted with fixed “external variables” which means that during the experimentation process (from the
Kaizen event till data collection after 6 months), no important changes happened (hiring/firing) or other external variables that
could affect the results.
The main limitation of the research is that it does not deals exhaustively with the link between the design and construction
phase. The reason is that bidding is a “transitional phase”. The first objective of the bid for construction companies is to secure
the project. Thus, resources should be well used to attain this objective without compromising the profitability (appointing a
construction manager during the bidding phase has a corresponding cost). Thus, our objective was to improve the outputs of
this repetitive “transition phase”.
10. Conclusion
In this research study, A Kaizen event was applied to the bidding phase in a building construction company. Performance
indicators were for monitoring. The selected performance indicators were related to: time, economical impact, quality and
sustainability factors.
The results could be resumed as follow:
- Bidding can benefit from lean thinking.
- Cultural aspects should be assessed before engaging a lean change program.
- Lean thinking not only helps improve operational processes but acts as a guide for setting up the new strategies as well.
The Lean thinking had also a managerial and social consequences: project team selection in for the bid shifted from “the
availability status” to a selection based on competences. In addition, a new bidding strategy was set to maximize the output of
this phase.
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Few research studies concern the contractor’s bidding phase and its improvement using lean thinking. It is mainly due to the
sequential structure of actors’ involvement in the construction project. However, the prominence of this type of procurement
in the French market should be viewed as an opportunity to make it more efficient for all the stakeholders (owner, architect,
contractors). Focus should be directed towards setting up Lean frameworks for contractor’s bidding phase. Finally, the link
between the bidding and building phase should be assessed by identifying waste occurrence (information loss, rework…)
within the contractor processes.
Disclosure statement
The Authors declare that there are no competing financial, professional, or personal interests from other parties.
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