5 Myths About IPD and Lean - Renee Cheng

Summary

The video script dispels common myths about Integrated Project Delivery (IPD) and Lean construction methods, emphasizing that success is not solely dependent on having an 'A-team.' It highlights the value of an IPD contract in fostering team building and positive behavior, contrary to the belief that it's too complicated. The script also clarifies misconceptions about the applicability of IPD to small projects and the potential for higher profits. It concludes by stressing the importance of a lean culture and engagement for improved project outcomes, encouraging the audience to explore further resources.

Takeaways

• 💡 There are many misperceptions about IPD and lean due to early projects not being typical examples.
• 📊 Five myths regarding IPD and lean need to be reconsidered based on more recent project experiences.
• 🏅 The myth that an 'A-team' is required for success is debunked; positive behavior can be fostered with proper team dynamics.
• 📝 IPD contracts are not overly complicated, and the time spent developing them is valuable for team building.
• 🔧 Lean tools are flexible and can be adapted to various team needs, contrary to the belief they are rigid.
• 🏥 IPD and lean are effective not only for large, complex healthcare projects but can also benefit smaller projects if scaled appropriately.
• 💼 Owners can still get good value from IPD projects without seeking bids, and teams can make significant profits.
• 📈 Some teams report earning 20-30% more under IPD compared to non-IPD projects, though results vary.
• 👥 Teams with 'skin in the game' behave more collaboratively and productively, leading to better project outcomes.
• 🚀 A lean culture with targeted strategies and tools can significantly improve project results and stakeholder satisfaction.

Q & A

What are the common misperceptions about Integrated Project Delivery (IPD) and Lean construction?

Misperceptions include the idea that having an A-team makes the delivery method irrelevant, that IPD contracts are too complicated, Lean tools are rigid, IPD is only suitable for large complex projects, and that the value to owners and team profits are uncertain. The script also challenges the belief that IPD and Lean are essentially the same.

Why is it a myth that an A-team makes the delivery method irrelevant?

The script suggests that by focusing on the risk-reward pool, mentoring, and setting a culture of accountability, positive behavior can be fostered and built within the team, regardless of the initial quality of team members.

What is the myth about IPD contracts being too complicated?

The myth is that the time and effort spent developing IPD contracts are not worth it. However, the script argues that the time invested is valuable and serves as team-building time, offering a significant return on investment.

How is the application of Lean tools and processes described in the script?

The script finds that the application of Lean tools and processes is more flexible than commonly believed, with teams varying in how they use these tools and the terms of IPD.

What is the myth about IPD being only suitable for large complex healthcare projects?

The script dispels the myth by stating that there is no evidence small projects cannot benefit from IPD, although they may need to be scaled appropriately.

How does the script address the confusion around the value to owners in IPD projects?

The script notes that while owners are not seeking bids, they still expect to receive value. It reports that 100% of owners met or exceeded their expectations, suggesting that they are indeed getting value.

What is the confusion regarding the team's profit in IPD projects?

The script addresses the concern that with the IPD contract putting profit at risk, it's unclear if the team is getting paid back. It mentions that some reports indicate teams making more profit than in non-IPD projects.

What is the myth about IPD and Lean being essentially the same?

The script challenges this belief by highlighting that behaviors within teams that have 'skin in the game' and are part of the signatory pool are strikingly different and more collaborative compared to those outside.

How does the script describe the difference in behavior between teams with and without 'skin in the game'?

Teams with 'skin in the game' are described as behaving more collaboratively, being more willing to trade scope, call out unproductive behavior, and reporting more enjoyment and positive experiences.

What is the conclusion of the script regarding the impact of a Lean culture and strategies on project outcomes?

The script concludes that a Lean culture, along with strategies and tools, can significantly impact project outcomes and that purposeful investment in engaging and training a team can improve business outcomes for all stakeholders.

What resources does the script suggest for those interested in learning more about Lean construction?

The script suggests visiting 'leanconstruction.org' for more research and tools or seeking out a local community of practice for assistance in one's Lean journey.

Outlines

00:00

📚 Debunking IPD and Lean Myths

This paragraph addresses common misconceptions about Integrated Project Delivery (IPD) and Lean construction methods. It emphasizes that having an 'A-team' is not the only factor for project success, as the delivery method and contract can significantly influence team behavior and outcomes. The speaker highlights the importance of team building, risk-reward sharing, mentoring, and accountability. The paragraph also dispels myths about the complexity of IPD contracts and the rigidity of Lean tools, showing that they are more flexible and rewarding than commonly believed.

Keywords

💡IPD (Integrated Project Delivery)

IPD, or Integrated Project Delivery, refers to a collaborative approach in the construction industry where all stakeholders, including the owner, architect, and contractor, are involved from the early stages of a project to its completion. This method aims to improve project efficiency and outcomes by fostering a team environment. In the video, it is discussed as a subject of myths and misconceptions, and the speaker clarifies that IPD can be beneficial for projects of various sizes, not just large complex ones.

💡Myth

A myth, in the context of the video, is a widely held but false belief or idea. The script identifies five myths associated with IPD and Lean construction practices, which the speaker aims to debunk. For example, one myth is that having an 'A-team' makes the delivery method irrelevant, which the speaker refutes by emphasizing the importance of the team's behavior and the contract method.

💡A-Team

The term 'A-Team' is used to describe a group of top-performing individuals. In the script, it is mentioned as a myth that having such a team negates the importance of the project delivery method. The speaker argues that even without an A-team, positive behavior can be fostered through attention to the risk-reward pool and a culture of accountability.

💡Risk-Reward Pool

A risk-reward pool is a financial arrangement where team members share both the risks and rewards of a project. The script discusses how attention to the size of this pool can influence team behavior and performance, which is crucial for successful project delivery in IPD and Lean construction.

💡Accountability

Accountability in the video refers to the responsibility and obligation of team members to perform and deliver according to expectations. The speaker highlights the importance of setting a culture of accountability to ensure that underperforming individuals are identified and managed effectively.

💡Lean Construction

Lean Construction is a methodology that applies lean principles, which aim to minimize waste and maximize value, to the construction industry. The script mentions that Lean tools are often perceived as rigid, but the speaker argues that they are more flexible than commonly believed and can be adapted to various team dynamics.

💡IPD Contracts

IPD Contracts are legal agreements that facilitate the collaborative approach of Integrated Project Delivery. The script addresses the myth that these contracts are too complicated and not worth the effort. The speaker counters this by stating that the time invested in developing an IPD contract is valuable as it serves as team-building time.

💡Team Building

Team building in the context of the video refers to the process of developing a cohesive and collaborative team, which is essential for the success of IPD and Lean construction projects. The speaker emphasizes that the time spent on developing IPD contracts and selecting Lean tools contributes to team building.

💡Collocation

Collocation in the script refers to the physical arrangement of team members in close proximity to facilitate communication and collaboration. It is mentioned as a variable aspect of how teams apply Lean tools and IPD principles, indicating that there is no one-size-fits-all approach.

💡Validation

Validation in the context of the video is the process of confirming that the chosen Lean tools and IPD practices are effective for the team. The speaker notes that how teams use validation is varied, showing the flexibility and adaptability required in Lean construction.

💡Profit

Profit in the script is discussed in relation to the concerns about whether teams and owners are getting fair value under IPD contracts, which put the team's profit at risk. The speaker mentions that while it's difficult to quantify the exact results, there are reports of teams making more profit under IPD than in traditional projects.

💡Signatory Pool

The signatory pool refers to the group of individuals who are part of the formal agreement in an IPD project. The script suggests that being part of this pool influences behavior, with those inside the pool exhibiting more collaborative and accountable behaviors compared to those outside.

Highlights

There are many misperceptions about IPD and lean due to their early stages of adoption.

Initial projects may not represent the typical IPD and lean experiences, leading to myths.

Myth: You need an 'A-team' for IPD and lean to be successful.

Studies show that fostering positive behavior and team building can lead to success, regardless of having top-tier players.

Attention to team composition, mentoring, and accountability is crucial for success in IPD and lean projects.

Myth: IPD contracts are too complicated and not worth the effort.

The time spent developing IPD contracts and lean tools is valuable for team building.

IPD and lean tools are more flexible than people think, and teams apply them in varied ways.

Myth: IPD is only suitable for large, complex healthcare projects.

Evidence shows small projects can also benefit from IPD, though they need to be scaled appropriately.

New teams to IPD can be equally successful as experienced ones.

Myth: Owners do not get the best value without seeking bids.

IPD projects show varied cost and schedule results, with some exceeding targets and others not.

Teams in IPD projects report making 20-30% more profit compared to non-IPD projects.

Teams with 'skin in the game' show more collaborative behavior and higher engagement.

A lean culture significantly impacts project outcomes and promotes positive behaviors.

Investing in team engagement and training improves business outcomes for all stakeholders.

IPD and lean are about more than signing contracts; active participation and commitment are essential.

For more information and tools on lean construction, visit leanconstruction.org.

Transcripts

[Music]

there's a lot of misperceptions right

now about IPD and lien partly because

we're just a little further in the

adoption curve and so in both cases

there earlier projects are not exactly

the archetypical projects and that but

those tend to be the ones that people

remember so when we think about the

myths associated with both IPD and lien

what we and for this presentation have

highlighted five myths that we think

really need a closer look now that we've

seen more projects so the first one that

I'll talk about is the idea that you

have to have an a-team and if you have

an a team of players then the delivery

method doesn't really matter the

contract method doesn't really matter

when in fact what we're finding through

these studies is that you can actually

foster positive behavior and build the

team and I think this is really

encouraging because it's hard to say

that you're going to have the very top

quality people on every project on every

case but you can actually build this

behavior by attention to how many people

are going to be in that risk reward pool

how you're mentoring those people how

you're bringing them on and then also

the clarity around who's not performing

to the culture that of accountability

that you're setting up how do you get

them off we also have a myth about IPD

contracts being too complicated that

they're not worth it for the amount of

effort that they that you spend

developing them and that lean tools are

very rigid and there you have to do all

this training to follow them in exactly

the right way we're finding it's a lot

more flexible than people think first of

all the investment of time to develop an

IPD contract or to work through lien and

decide which tools are going to be the

most effective for your team is really

valuable time and that is actually team

building time and so to think that it's

just too much time and it's not worth it

there's a huge return on that investment

what we're also finding is that the

teams are quite varied and how they're

actually applying the lean tools and

processes and how they're using

particular terms of the IPD as well as

in how they use their collocation how

they use validation so there is variety

there's no rigidity about this the next

myth that we talked about is about IBD

really being large complex health care

and there's no evidence that small

projects can't

we benefit they do have to be scaled and

so we need to know more about that but

it's it's pretty much clear that you can

have a team that's brand-new to APD that

can be equally successful as to one that

is 50 percent or more experienced so the

idea that it's only really good for IP

and lean if you have large complex

projects is really not true the other

thing we see a lot of confusion around

is the value to the owners because

they're not seeking bid so they're not

going out to the market are they really

getting the best value the other thing

we see a confusion around is is the team

making a profit because the way the IPD

contract puts their profit at risk are

they actually getting paid back and it's

a little bit hard to say the pure

results from this because what we

actually are finding is things about the

value for the owner when you think about

cost and schedule some of that depends

on how well they set those costs and

schedule targets in these projects we

did find a hundred percent of the owners

were met or exceeded their expectations

but in actuality if you looks not all

the project teams were under the target

some of them were just a bit over and a

number of them were under same with

budget that one was over and others were

at and then somewhere under when you

look at the teams again the picture

around money is a little bit hard to say

we are seeing some reports where people

are saying they're making 20 to 30% more

than what they would make under non IPD

projects but I do think that you're

generally seeing the team collectively

with the owner determined at target cost

and then in the end they did drive the

original allowable cost way below market

and then their profit was distributed

the last myth is really one that

personally for me I really was in the

the camp of saying that IBD and IP

divided are essentially the same when in

fact now we're really finding that there

is a difference that the behaviors are

pretty strikingly different with those

that don't have skin in the game and

when they're not part of the signatory

pool or they're outside the bubble list

we might call it they do behave

differently and then those that are

within the signatory pool also behave

much more collaboratively there's a lot

more fluidity and how they're willing to

trade scope and they're much more

willing to call out behavior

it's not productive and they are also

reporting a lot more fun and enjoyment a

lot more time being spent on positive

things as opposed to negative things or

conflict and just how they're

distributing the their responsibilities

is very positive and collaborative so I

do think that it's more than just

signing charters but actually having the

skin in the game is important this

research makes it clear that a lean

culture along with strategies and tools

can significantly impact project

outcomes purposeful investment to engage

and train a team and some are many of

these practices will improve the

business outcomes for all stakeholders

don't let a specific contract or

practice stand in your way there's a lot

to learn why not get started today

for more on LCI research and tools to

assist you in your lean journey go to

lean construction org or seek out your

local community of practice