success factors for swedish industrialized housing construction prof. lars stehn structural and...
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Success factors for Swedish industrialized housing construction
Prof. Lars Stehn
Structural and Construction Engineering
Luleå University of technology
Lessing, J., Stehn, L., and Ekholm, A. (2015) Industrialised house-building – development and conceptual orientation of the field, Construction Innovation, Vol. 15, Iss. 3, 378 – 399.
Industrialized building construction
Sweden beats the world hands down on prefab housing
• Industrialized house-building worldwide still mostly mass production based on a historical approach (Goodier and Gibb, 2007)
• About 84% of detached houses in Sweden, 15% in Japan and about 5% in the US; Australia and the UK use prefabricated timber elements
Temporary housing, UK post war build-up
Sweden todayposted on
So, this modern customer oriented Swedish version of Industrialized housing construction
What is it?
Prefabrication important but not enough
“offsite construction”, “pre-assembly”, “automation” etc. are technology based definitions that take a stand-point in production methods and prefabrication
Integration to “control the means of production”
Industrialized housing construction involves defined production methods but:
•is based on who owns“the means of production” and
•how to integrate “the means of production” into a controlled concept.
Integration of the means for production - a product platform
Lessing et al. (2015)
Three key ingredients needs to be integrated
1. Industrialized housing construction must be a strategy that effects how the whole company operate
2. Market specialization and selection of niche markets sets the requirements for the production system
3. High degree of product predefinition through utilization of product platforms
Characteristics - key points
Integration of the nine constructs of the product platform to own or to control the means of production to be competitive
Selection of products or market niches to a business strategy necessitates
•Fit of production system to market (example 1)
•Loyalty to the business model (example 2)
Example 1
Fit of production system to market
Robertson and Ulrich (1998) Winch (2003)Hvam et al. (2008)Johnsson et al. (2013)Jansson et al.(2014
Norms and standard
General platforms
Self-owned platforms
Standard products
Detailed drafting
Combining building elements
Configuration
Choose variant
Client order decoupling point
Production based on forecast
Production based on client order
The product platformthe essential choice for a
company
Market demands vs. production capability
Construction capabilities
Tendering
Procurement
Engineering/design
Supply chain coordination
Site/factory coordination
Market demands
Product type (customized to standard)
Product range (wide-narrow)
Demand volume
Price
Conformance to Quality
On-time delivery
Market offerProduction design
Fixed assets and equipment organization
Product planning and control
Automation technology
Market strategy
Resource strategyHallgren et al. 2004
Choices made by some Swedish companies
Market strategy
Self-owned platforms
General platforms
Norms and standards
Standard products
Resource strategy
Broad market (process
standardization)
Niche market (product standardization)
Veidekke
PGS
Moelven
BoKlok
Kärnhem
Lindbäcks
Example 2
Loyalty to the business model
Defining what business models are
• Business models are constructs illustrating how companies are built up and the way they operate(Baden-Fuller and Morgan, 2010)
• Clarifying a business model can help a company to support the chosen product platform Brege et al., (2014)
The offering presents the value proposition of the company. The offering is a combination of physical products and services offered to the customers. The market position describes the company’s role in the marketplace and in the supply chain, with close connections to strategic effectiveness (are we doing the right things?). Market segmentation and marketing strategies for the segments based on the four P’s (product, price, place and promotion) are vital components for the market position. The operational platform consists of the company’s resources and competences together with external resources from suppliers and partners and has close linkages to internal effectivess (are we doing things right?). A product platform and designated production system are important components for enabling the company’s product offer.
The case of multiple business models
• Explorative longitudinal case study from one manufacturing company
• Data from a period of 15 years (1997-2012)
Business model loyalty lesson
• Really difficult to combine standardisation of manufacturing with customisation in same plant if not deliberately managing a portfolio of different business models (Höök et al., 2015)
Standardization of processes integrated with predefinition of
products
Industrialized housing construction is to standardize how
construction is performed not the result
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