Do You Have a Continuous and Balanced Improvement Culture?

March/April 2018

Communities: Construction
Do You Have a Continuous and Balanced Improvement Culture?

BY MATT STEVENS, PH.D., AND JENNIFER E. DAY, PH.D

Stevens and DayExperienced contractors know that the construction industry’s constant change requires each of us to pursue continuous improvement. It is a choice and controllable action. Its benefits can give strong strategic and operational results long term. Sometimes the improvement is prompted by a problem, internal change, industry change, or innovation. In each case, a strong internal culture is ready to act and support the journey to increasing efficacy, making it normal and expected. We call it a Continuous and Balanced Improvement Culture (CBIC).

We assert that the most successful companies have mastered three balances:

  • Between innovation and proven methods;
  • Between rapid and incremental improvement; and
  • Once an improvement is adopted, between highly detailed documentation and trusting employees for part of the decision making and execution.

How a CBIC Happens

In our experience, a CBIC is a product of six positive factors.

1. A generative culture

A culture that is open to input from all levels of the rank and file is best positioned to foster a CBIC. In a generative culture, everyone in the company behaves like an owner.

2. A purposeful mission

Companies with CBICs have employees and owners who are aligned behind a purpose—a “North Star.” This can be building monuments, being a leader, or striving toward double-digit profits. It can be building communities or leading the industries while taking care of the company family or building a company for the next generation. Whatever the mission, the best companies have employees who can identify and believe in it.

3. A structured approach

A purposeful mission starts with strong strategic planning. Our process GRAET includes setting a worthy goal; identifying the reality of the industry and the company; aligning the company processes behind that goal and reality; enhancing those alignments for better safety, quality, cost, and speed; and transforming the industry to the firm’s advantage. Each step is sequential in time and difficulty. For the continuous improvement journey, lean manufacturing’s kaizen offers such a framework. The simplicity of any effective structured approach is that it is quickly understood by all so its implementation may be deeply pursued.

4. Informed employees

An important component of a purposeful mission is employees who understand that mission. It is not sufficient for the management team to decide on a strategic direction: Everyone must be involved in creating a CBIC. In a CBIC, employees know the value of being a little better, a little faster, a little more detail oriented, or more explanatory. In construction, improving labor productivity by 10% can double profits. Contractors know why this works, but employees often do not understand that the small efforts result in big changes. It is one example of an organizational knowledge challenge. The best CBICs make the value of small improvements clear to employees.

5. Aligned incentives

CBICs reward their employees for continuous improvements. This may mean keeping track of project managers’ accurate reporting and rewarding them for being on time. This may mean acknowledging thoughtful weekly planning submitted on time by superintendents on a Friday afternoon. This may mean praising safe behavior by field personnel.

6. Institutional support

CBICs have an organizational structure that supports continuous improvement. Would a flatter organization be more responsive?

What about natural conflicts, such as those between the field and office? Would your software, if more tailored, execute tasks quicker and more accurately while reporting the level of compliance?

Dauntingly, cultures, like people, take five years to change. So, for those who make this transition, it is quite a barrier for competitors that want to improve their internal human dynamics. We cannot imagine a better competitive edge against peer companies.

It is interesting that most innovation adoption requires 18 months for full implementation. After this initial phase, improvements and new thinking are needed to keep the innovation current and keep a competitive edge over other contractors who adopt the same system.

It is important to remember that taking on new technologies is not necessarily an indication of a CBIC occurring. In our experience, CBICs are a result of teaching, mentoring, a steady company process, and a purposeful mission.

A CBIC supports today’s journey, which will evolve into future opportunities. To increase effectiveness without rework—the most expensive of all mistakes—a structured approach is needed. Much time and energy can be spent planning and executing an ineffective idea, but a disciplined pathway will provide efficiency.

We suggest structuring your improvement process with a framework, then documenting and communicating it to capture improvements, provide clarity, and establish a platform from which others can build for the next generation of leaders.

Matt Stevens, Ph.D., and Jennifer E. Day, Ph.D., are owners of Stevens-Day Construction Institute Inc. Stevens holds a doctorate from the University of Florida’s M.E. Rinker Sr. School of Construction Management. Day holds a doctorate from the University of California, Berkeley.