What do Hospitals and Construction Projects have in common?

Introduction:

In their article Why Hospital don’t learn from Failures, Anita L. Tucker and Amy C. Edmundson completed a study of nine high performing hospitals to determine why the same problems seem to occur over and over again in the Hospital environments.  To gather this information the research team completed a direct observation study on the frontline workers (Nurses) as they went about their daily business to determine what type of issues occur on a daily basis and how the issue are dealt with.

The direct observation team identified 194 issues that they categorised into problems and errors.

Problems were defined as issues that were caused by issues outside the direct control of the frontline workers

Errors were defined as issues caused by the frontline workers themselves

The data showed that that 85% of issues that front line workers were dealing with were caused by problems that were outside out of their control but because of the need to keep the work going 100% of the issue were being addressed using what the research team called first order problem solving.

What is First Order problem solving?

First order problem solving occurs when a worker fixes the issue that they are presented with to solve the problem as it is presented. For example, a staff member sees’ a bed not ready for a patient, they go get clothes from another bed in another ward. They make the bed ready, the problem is solved.

The pro’s of first order problem solving is that the activity, while interrupted for a short period of time, gets back on track as soon as the solution is found.   The con’s is that the actual root cause of the problem is not resolved and the problem has a high probability to re-occur.

What is Second order problem solving?

Second order problem solving occurs when the worker, in addition to doing first order problem solving, also takes further action to address the actual reason why this problem occurred. For example, a staff member sees’ a bed not ready for a patient, they go get clothes from another bed in another ward. They make the bed ready, the problem is solved.   Then, they contact their manager to describe the issue and ask’s for the manager to check why this happened and to ensure that it does not happen again.

The pro’s of second order problem solving is that if the root cause of the problem is addressed then the problem is solved and does not reoccur. The Con’s is that it takes time, influence and skills that the front line worker may not have

So how do you move from First Order to Second Order problem solving?

The authors propose that in order to move to a second order problem solving the following steps need to be implemented

Step 1: Management must increase their support to allow for training, structures, process and time to be allocated to problem solving.

Step 2: Management need to create a safe space where workers feel free to talk about problem they are encountering without fear of ridicule or punishment.

Step 3: Management must follow through on suggestions for improvement from the frontline workers.

The gains of facilitating these process look like an increase in resources and therefore funding but, in the study referenced for this article, the research team argue that an elimination of just the worker waiting time, calculated at 8% would yield a savings of approx. $256,000 per year in lost time at a 200 bed hospital.  How much would it save in lost time on a project???

So where is the relationship between Hospitals and Construction?

Like Hospitals, Construction performance is based heavily on the performance of its frontline workers and the majority of people that work in construction are those at the frontline. In fact 48% of value added construction activities are generated by the frontline trades over a full project cycle.

The McKinsey Report on Reinventing construction outlines that construction firms in Europe with more than 250 employees account for less than 1% of all construction companies while 94% of construction companies have less the 10 employees. These are the construction industries frontline workers.

The same report shows that these frontline workers have a baseline productivity that is 20% lower than the sector average. An analysis completed recently by DPS Group to determine the main drivers for construction productivity losses during the construction execution phase shows that pre-requisite works not being ready and material delivery and management on site.  Both which are out of control of the frontline worker but have a direct impact on their productivity.

Finally, for the frontline companies, their margins are tight, they have deadlines and they need to meet their targets or they will risk having a loss on the project.    If they see a problem, they will resolve the problem in front of them and they will use first order problem solving to do so.

Therefore, Like the Hospital example, the majority of value added work on construction projects is completed by the frontline workers. Like the frontline staff in hospitals most construction projects suffer from problems that are outside of the daily control of the frontline worker and finally the most common method for problem solving is in construction is the first order kind.

So how do we ensure that we move to second order problem solving in construction?   The answer is the same as with the Hospital study but in this case the management are the larger Construction companies or the General contractor.   As these companies tend to be less fragmented, they have the infrastructure to mimic the Toyota process of coaching and helping their supply chain to improve their productivity.

Like the Hospital study in order to move to a second order problem solving the following steps need to be implemented

Step 1: Large Construction Companies must increase their support to allow for training, structures, process and time to be allocated to problem solving.

Step 2: Large Construction Companies need to create a safe space where their frontline workers are free to talk about problem they are encountering without fear of ridicule or punishment.

Step 3:  Large Construction Companies must follow through on suggestions for improvement from the frontline workers.

There is plenty of evidence that most successful projects use Lean problem solving techniques such as direct observation, last planner, PDCA, Kaizen and Kata’s to identify and resolve issues to the root cause to prevent them from re-occurring.

The LCI’s own data shows that project that use Lean processes are three times more likely to complete ahead of schedule and twice as likely to come in under budget.

Like Toyota, the larger construction companies must take the lead in the improvement of the construction supply chain by first implementing lean practices in their own companies and then into the companies that work for them. The larger construction companies need to lean the implementation of standard Lean practices on projects (Last Planner, Direct observation, Waste walks and Kata sessions) and to take ownership of administrating these processes on projects.

And as per the hospital study, the gains of facilitating these process look like an increase in resources and therefore funding but, if the elimination of just the worker waiting time, calculated at 8% would yield a savings of approx. $256,000 per year in lost time at a 200 bed hospital, how much would it save in lost time on a large capital project?

Lean Construction USA, 2016. The business case for lean construction…there is a better way. [Online] Available at: WWW.LEANCONSTRUCTION.ORG/LEARNING
[Accessed 24 Feb 2018].

Mckinsey Global Institute, 2017. Reinventing Construction A route to higher Productivity, s.l.: McKinsey & Company.

Tucker, Anita L, Edmundson, Amy C. 2003. Why Hospitals Don’t learn from Failures. California Management Review, Vol 45 No 2. Pg 55-72

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