Lincoln Forbes, Ph.D., P.E., LEED AP, is an adjunct professor at Florida International University, principal consultant at Harding Associates Inc. and an expert in the field of bringing the worlds of lean and sustainability together in the realm of the construction industry.
An insidious threat lurks quietly in the shadows – our environmental sustainability in relation to the built environment. Built facilities account for 40% (three billion tonnes annually) of raw materials use globally. In the US, buildings account for 65.2% of total electricity consumption, more than 36% of total primary energy use, and 12% of potable water. They generate 136m tonnes of construction and demolition waste and 30% of total greenhouse gas emissions. Fossil fuels continue to be depleted at a relatively rapid rate; in turn, greenhouse gases are degrading the ozone layer faster than climate change experts think can maintain the planet on a sustainable path.
The UN established the Brundtland Commission in 1983 to encourage countries to pursue sustainable development. In 1987 it released a report defining sustainable development as the development that meets the needs of the present without compromising the ability of future generations to meet their own needs. Professor Charles Kibert, a researcher at the University of Florida, further defined sustainable development in 1994, as “the creation and responsible management of a healthy built environmental based on resources [that are] efficient and ecological”. Clearly, any efforts to improve sustainability on a global scale can be significantly leveraged through initiatives in the construction industry.
How are sustainability standards addressed?
Several sustainability initiatives have been implemented since the 1990s, and the most prominent ones are Leadership in Energy and Environmental Design (LEED) established by the U.S. Green Building Council (USGBC), the building research establishment environmental assessment method for buildings (BREEAM) and the DGNB certification system in Germany. BREEAM is used to assess buildings and large scale developments in many countries around the world, including the United Kingdom, Netherlands, Spain, Germany, Norway, and Sweden. The DGNB certification system can be applied internationally. There are several other initiatives such as energy star, green globes, and Florida green building coalition. Although these initiatives have significant differences between them, they all seek to promote high levels of environmental performance in buildings and communities.
In this article, LEED will be used as a proxy for sustainability initiatives for built facilities.
The LEED system was developed in 1995 as a voluntary, consensus-based national standard for developing high-performance, sustainable green buildings. The certification programme awards points and ratings, for satisfying green building criteria. Its major categories include: sustainable sites, water efficiency, energy and atmosphere, materials and resources, indoor environmental quality and innovation in design. The overall goals for sustainability include:
- Maximising resource reuse
- Utilising renewable energy sources
- Creating a healthy working environment
- Building facilities of long-term value
- And protecting and/or restoring the natural environment.
Is there a connection between sustainability and lean construction?
A brief overview of lean construction will help to clarify this question. Lean construction is assumed to include both the design and construction phases of a project. Greg Howell and Glenn Ballard, co-founders of the Lean Construction Institute (LCI), view lean construction as a new way to manage construction. In their view, the objective, principles and techniques of lean construction taken together, form the basis for a new project delivery process. The Construction Industry Institute (CII) describes lean construction as “the continuous process of eliminating waste, meeting or exceeding all customer requirements, focusing on the entire value stream, and pursuing perfection in the execution of a constructed project”. Waste represents activities or resources that consume time and/or cost, but add no value.
Lean construction is a collaborative approach to project delivery, in which stakeholders, including the project team and the owner, seek to optimise the overall project, minimising waste in all forms and maximising value. It contrasts strikingly with traditional construction practices in which project team members seek what is called local optimisation to maximise their individual progress and their profits. This often happens to the unintended detriment of other team members and the project as a whole. Target value design (TVD) focuses designers on meeting-and exceeding-owners’ project requirements at prices below the market rate, while providing high quality and constructability.
Lean construction is based on a highly structured process derived from the Toyota Production system (TPS). The seven main wastes identified in the TPS are targeted for reduction in the construction environment, both in the design and construction phases of a project. Examples are:
- Idle time: people waiting for work, or work waiting for people, sometimes caused by poor co-ordination
- Excessive transporting/conveyance: caused by poor site layouts
- Processing waste: waste in the work, and materials
- Inventory waste: having unnecessary stock on hand
- Wasted motion: due to poor practices
- Defective work: resulting in rework
- Over-producing: often seen as a virtue, but it may obstruct the next discipline
- Other wastes: very typical in construction is the underutilisation of people’s minds and initiative.
The lean construction philosophy views a project as a promise delivered by people working in a network of commitments. Smooth work flow is dependent on having the parties to construction make promises to carry out assignments, and keep their promises; waste is reduced, productivity is increased, and projects can be completed more rapidly. Foremen are empowered to plan the detailed work activities for each week with their counterparts from different trades or disciplines.
An integrated form of agreement is very effective in having people from different disciplines and companies work together for the benefit of the project – as well as themselves. It promotes problem resolution through collaboration between the various disciplines. Mediation is substituted for litigation. Training of staff at various levels is a non-negotiable requirement. Project teams have to adopt lean processes such as the last planner system that requires ongoing collaboration with other disciplines, measurement, analysis, and action. Performance metrics are applied weekly – not just at the end of a project, so work activities are kept on track and the possibility of errors and surprises is reduced. As a result, many lean projects have experienced more than 10% savings in the schedule and/or overall cost – in some cases, simultaneously.
Green construction is a natural extension of the lean philosophy of eliminating waste – it reduces the waste of energy, water, and materials. While lean construction minimises waste, ensuring that the resources used in the building process enhance the value chain for a completed facility, green building design promotes environmentally beneficial long-term operation. Not only is a lean building assembled using fewer resources – human, financial, energy, – and to some extent material, a green building has a lower environmental impact in its construction as well as in its ongoing operation. Green practices may even reduce initial construction costs. The recycling of construction material reduces the amount of physical waste generated in a project, and the amount of pollution associated with the process is reduced as well. Sorting construction waste on a site qualifies for LEED credits. It also reduces disposal costs as some of that material can be reused.
Comparing the benefits of sustainable projects and lean projects
Two studies, by the New Buildings Institute (NBI) and the CoStar Group respectively, have verified that certified buildings outperform their conventional counterparts across a wide variety of metrics, including energy savings, occupancy rates, sale price and rental rates.
The NBI study indicates that new LEED certified buildings, on average, perform 25-30% better than non-LEED certified buildings in terms of energy use. Gold and platinum certified buildings have average energy savings approaching 50%. New LEED certified buildings have commanded rent premiums of $11.24 (2008 dollars) per square foot over their non-LEED peers and have had 3.8% higher occupancy. Rental rates for energy star – rated buildings represent a $2.38 per square foot premium over comparable non-energy star buildings and have 3.6% higher occupancy. Both energy star and LEED-certified buildings have commanded higher market prices per square foot. The US General Services Administration (GSA) conducted a post occupancy survey of twelve sustainably designed buildings including seven that were LEED certified. They reviewed environmental performance, financial metrics, and occupant satisfaction. Their key findings were that, compared to national averages, these facilities experienced 26% less energy use, 13% lower maintenance cost, 27% higher occupant satisfaction, and 33% fewer CO2 emissions.
With regard to lean projects, there have been several notable examples of successful project delivery.
The Sutter Health Care system in California embarked on a lean journey in the early 2000s following a state mandate to implement major capital improvements to their failing health facilities’ infrastructure. Working with very tight budgets, they embraced lean project delivery as a leap of faith; and had positive results that greatly exceeded their expectations. A study of 22 lean projects valued over $10m each and completed since 2005 revealed:
- No projects over budget or schedule
- No sacrifice of scope or quality
- A final cost 5.8% under budget, and approximately 15% under market, on average
Sutter subsequently initiated 135 active projects worth $4.4 billion. Through the lean process, these projects had savings estimated at $125 million under budget. An example of Sutter’s successful projects is the Camino Medical Group Office Building in which costs were reduced by $9 million, and the schedule was shortened by six months. Labour productivity was increased by 15 – 30% and rework was reduced to less than 0.2% versus the 5–10% range of many traditional projects.
A hospital system in Florida recently built an 80-bed hospital wing plus kitchen facilities. This 100,000 square foot addition was constructed with integrated lean project delivery (ILPD), using an integrated form of agreement. A very tight schedule and budget called for innovative approaches; lacking prior lean experience, the project team hired a lean facilitator for training and implementation support. Project outcomes with the lean process were highly successful. The schedule was reduced from 14 months to 12 months. At the same time, cost savings were approximately $3m on an estimated reference price of $34m. RFIs were addressed promptly and did not affect the schedule. Safety performance was very high: over 200,000 man hours without a recordable accident.
Why aren’t there more sustainable projects?
The primary barrier to the introduction of sustainable construction is the widely held belief that sustainable construction is more expensive and involves a higher risk. The higher costs are attributable to new technologies, specialised materials, and additional design. In many projects, cost projections emphasise initial costs, with less attention to life-cycle costs. Some facility owners are not motivated to generate lower operating costs for building occupants or tenants. The LEED process involves paying fees for certification as well as hiring a commissioning professional to verify that specific processes have been followed. A number of owners have adopted sustainability initiatives, but have stopped short of seeking certification. A recent survey of contractors identified “higher initial cost” (90%) and “difficulty/cost of certification” (57%) as primary obstacles to sustainable building, even though 81% thought it was “the right thing to do”. In the same survey, 88% of respondents reported the additional cost of LEED certification as less than 2% of overall project costs.
A wider understanding of sustainability and life-cycle costing, as well as a lowering of initial cost will greatly affect the acceptance of sustainable building. Nevertheless, recent studies suggest that designers have begun to incorporate green practices in standard designs. Some contractors have begun to institute paperless jobsites and to practice waste diversion.
Michigan State University’s new dining hall is an example of a successful lean and LEED GOLD project, driven by a knowledgeable owner. MSU’s Dr. Tariq Abdelhamid, a proponent of both lean and sustainability, helped to guide the project. The Vista at Shaw Hall was a renovation project completed in January 2013 at a cost of $13.2m, and was the first lean/IPD project at a US public university.
Because of the challenging scope as a renovation with asbestos abatement, MSU selected lean/IPD with an integrated form of agreement (IFOA), with contingencies for hidden existing conditions, and construction risk. Building information modelling was used for clash detection, and the contractors were active participants in the design phase. Project outcomes were outstanding: the seating (made of recycled materials) was almost doubled from 455 to 720. The project was completed 3 weeks early, at a price 15% lower than comparable projects, and the contract administration cost was 28% less. In addition, 84% of the construction waste was diverted from landfills; 11% was recycled – flooring, concrete, metals; and 21% of construction materials were obtained within 500 miles. Abdelhamid credits lean design and construction with “achieving green features at reasonable and competitive first costs to the owner”.
The way forward
Sustainability projects and lean projects have both clearly demonstrated their contributions to a better future state for the environment. Lean projects have routinely saved 5 to 10% of initial costs, and even more when compared with standard market costs. High stakeholder satisfaction has been observed as a hallmark of lean construction, worker safety has been far greater than in traditional projects. There have not been reports of litigation in the hundreds of lean projects to date. Sustainable projects generally use 30% less energy and 30% less water, resulting in lower operating costs indefinitely. Energy star rated facilities emit 35% less carbon. During construction, many projects have used recycled wood and metal, diverting tonnes of waste from landfills. The many intangible benefits include better air quality, higher occupant satisfaction and productivity.
The question of a premium for sustainable projects is still debated but has been measured in the range of 1-5%, significantly less than typical lean construction savings. Lean and sustainability represent a smart business practice and social responsibility at the same time.