Integrated Supply Chain

The Key Tenets of Industrialized Construction

Industrialized Construction is an ecosystem solution to the key construction industry challenges of increased project complexity and limited labor pools.

The Key Tenets of Industrialized Construction

Demand is accelerating for construction across the globe. There are numerous construction disruptions and challenges such as supply chains constraints and labor shortages. Amid high growth and limited resources, projects continue to balloon in size and complexity. Numerous technologies and methodologies seek to address these challenges.

Industrialized Construction is an ecosystem solution to the key construction industry challenges of increased project complexity and limited labor pools. Specifically through the integration of delivery principles from manufacturing to the construction process.

Industrialized Construction heavily relies on three key principles:

  • Modular construction, offsite manufacturing, or prefabrication,
  • More advanced production planning approaches, &
  • Automation of low-skill, highly repetitive manual tasks.

Some expand the definition to include “big data”, the use of the “internet of things”, AI, and robotics. All of the above should be treated as outcomes. For instance, modular construction is enabled through supply chain integration, and better detailed design.

What are some of the benefits of Industrialized Construction?

  • Cost Savings & Reduced Waste: Industrialized construction can reduce costs associated with traditional construction projects through greater efficiency in a manufacturing environment.
  • Speed: Construction projects can be delivered faster through tandem workstreams improving efficiency.
  • Continuous Improvement: True closed-loop learning of "finished products" enables continuous improvement.
  • Safety& Quality: Offsite Construction means that work is moved into manufacturing facilities where there is a safer work environment and higher quality control.
  • Design Flexibility: Industrialized construction allows for greater flexibility in terms of design, as components can be easily customized and changed to fit the specific needs of the project.
  • Integrated supply chains mean enable more effective strategic sourcing of raw materials and equipment on a program basis.

How do I get there myself?

All of these benefits can be enabled by changing your traditional construction model to an industrialized delivery model. The Project Production Institute and Cal Poly University summarize the requirements for Industrialized Construction through three workstreams:

  • More detailed and better quality engineering; enables offsite production and systems engineering roles to evolve, leading to PLM and continuous improvement.
  • The ability to effectively integrate and manage the supply chain to enable offsite work. This involves flattening supply chains and reducing frequent inefficiencies of traditional supply chains.
  • Knowledge and application of production management and improved operations management.

The majority, of IC benefits, can be achieved through the application of these three key manufacturing and production principles to construction.

Engineering & Design

In a traditional delivery model, the design intent is well documented but almost always lacks the details that make it repeatable. This is the coordinated routing of conveyance for electrical, mechanical, and other systems. In an industrialized delivery model, DfMA (Design for Manufacturing and Assembly) considerations are prioritized. Designs must be easy to both produce, and install on the site.

The right level of detail must be transmitted to the right partners at the right time. This doesn't necessarily mean a higher level of detail, that is often added by your partners. What is more important is the interface with the installation site: where will trades hook up on site? What spare parts will be sent, what is required?

Construction Supply Chain Integration

Supply Chain integration and management is required for two critical reasons:

  1. Distributed offsite work increases coordination complexity. The ability to integrate and manage the suppliers that execute that work is critical.
  2. The implementation of strategies such as flattening the supply chain, negotiating bulk purchases, and implementing inventory management practices

A integrated supply chain in construction starts with planning. The supply and demand part: who has what products or services and will they work for your site? How long will it take to get there and what other logistics considerations are there?

This enables the creation of supply chain models that inform planning. In an Industrialized Delivery Model, Supply chains include a direct link between your suppliers and the project team. This allows direct transmission of information between key stakeholders without information gatekeepers reducing data fidelity.

Advanced Production Planning

Production planning is a practice rooted in operations sciences. It specifies that work is segregated into logical, multi-trade packages. The production of each is managed in an orchestrated manner with the others. This enables work to be sequenced in tandem.

Some of those packages may be built offsite as volumetric modular or prefabricated packages. Others may be a hybrid or “kit-of-parts” with final assembly in the field. Others may be executed in a very traditional, stick-built manner. What is important is that all team members are coordinated and in sync with everyone else.

Want to learn more?

Read more about the challenges in the construction industry and how an Industrialized Delivery Strategy can help you deliver projects faster?

Download our Whitepaper | The Key Tenets of Industrialized Construction

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