Lean Procurement and ManagementMinistry of Justice

Terry Stocks

Presentation for the Construction Industry Council

June 14th 2012

• Previous Presentation given to the council members in October 2009

• A common Purpose (Supporting Growth – Better for Less)

• Presentation contained the MOJ’s lean delivery process.

• Projected benefits at that time (Update)

• Current State

• New Initiatives

• Lessons Learned

• Future Initiatives

Content

Capacity Growth

Value

A Common Purpose

• System approach to Project Management

System:

•Provides a clear set of benchmarking data

•Supports collaborative working

•Provides performance data to “prove better for less”

•Provides the tool to support a Lean culture

•Supports continuous improvement

•Focused problem solving

•And Much More

Lean in Construction

Yr 1 Yr 2 to 5 Yr 6 onwards

System in place,Data cleanedTraining in basicsCulture change startsDeveloping understandingSupply chain barriers

System bedded inReliable dataContinuous Improvement culture at client levelMoving to flow orientation.Supply chain use system

2015 onwardsSystem is the normData is driving improvementCI at most levelsFlow used in most areas.Supply chain drive improvement

Cost reduction 5 to 10% Cost reductions of 6 to 24% Cost reductions of 25 %+

Delivery reliability

At 60% to 80%

Reliability up to 90%,

10 to 15% off project time

Reliability 95%+

Project times Improved by 20 to 50% Defects/rework/delays

identified and base lined

Defects/rework/delays

reduced by 15 to 25%

Defects/rework/delays

reduced by 50 to 80%

State

Benefits

Tim

eC

os

tQ

ua

lity

Yr 1 Yr 2 to 5 Yr 6 onwards

Achieved Vs Predicted (October 2009 Base)

Performance Data

Area National Construction Industry KPI (2010)

MOJ Data Returns

Project Cost Predictability

52% 100%

Project Time Predictability

43% 70%

MOJ DataArea MOJ Data Returns

Increase in product value

20% Actual constn cost as % of project out turn

Claims value (% of project budget)

1%

Projects contract cost < pre contract estimate

86%

Projects complying with Lean delivery process and reporting

100% ECI, Buffered programme, delay analysis, RCA, CI

MOJ – Lean Performance - Evidence

Standards are modelled / depicted as

elements

Cell Office Classroom Roof

Current Standard Docs and Specifications

Elements copied and arranged produce required product

Outputs in 3D, or Excel data sheets,

2d plans etc

Autom

atic QA

QA is inbuilt as outputs automatically report non compliance as rqd standards are embedded

Stan

dard

ele

men

ts b

uild

up

requ

ired

outp

ut Reduced

Design

More Money spent on Asset

Using Tools – BIM – Helping to drive out waste

• Industry (Professional Service providers and contractors) do not practice collaborative working

• Constructors ability to deliver a project to an agreed programme is poor

• Industries awareness of process waste is low

• Industries capacity / will to lead change across their client portfolios is low

• Need very clear communications and training to set expectations

• Without framework relationships – changing culture would be very difficult

Lessons Learned

The Future

Directorate Costs

(MOJ Costs)Technical Supply

ChainCosts

Constructor Costs(OHP, Mgnt, Prelims Etc)

Delivered Product

(actual bldg & labour)

C

C

%

Q

R

T

C

Q

R £/m2£/Unit

•Convert current PPI process into a fully accessible software system (Summer 2012)

•Put in place a training programme for the whole supply chain on collaborative working, lean, data management etc

•Re tender the current professional service framework to support collaborative working goals

•Develop a full set of BIM libraries and have all projects delivered in a BIM environment by September 2013

•Measure the outcomes

•Reduce cost of project delivery by 20% in this SR period (Cabinet Office)

Thank You

Questions