Better Materials Management Enables Contractors to Stay On Time and Under Budget
A few months ago, Just-In-Time (JIT) delivery, a core component of Lean Construction, was one of the many tools contractors could leverage in their projects. Today, as contractors struggle to cope with supply limitations brought on by the Coronavirus outbreak, JIT delivery – a tool that saves time, money and materials – is more relevant than ever.
Thirteen years ago, construction crews working on the Mandarin Oriental in downtown Boston completed their work to find they had drastically overestimated the amount of materials they needed. Pallets of pre-ordered insulation, drywall, steel studs, joint compound, and more sat unused on the site. While a few lucky workers came away with some free materials they needed for their home renovation projects, the majority of it was thrown away; the cost of the wasted materials exceeded $500,000. What happened at the Mandarin Oriental has been repeated many more times throughout New England.
In our current situation, we need to operate smarter. Failure to understand the type and quantity of materials needed leads to over-ordering and running up expenses for supplies that are never used. And, right now, it’s a challenge just to obtain the necessary supplies. JIT delivery provides an opportunity for smarter management of materials ordering and aims to solve the issue of budget inflation. Done right, JIT delivery can reduce a project’s budget by up to 15%.
JIT delivery works through the concept that contractors reduce costs and save time when crews order materials in small amounts as they need them. Instead of estimating everything they’ll need ahead of time, foremen are instructed to order just the supplies necessary to complete the immediate task at hand. As a result, little (if any) excess components need to be discarded, and valuable laydown space, especially in the narrow confines of Boston construction sites, is preserved. As modern contractor supply firms are capable of response times measured in minutes and hours – not days – this approach is more viable than ever before.
But while there are clear advantages to utilizing JIT delivery, it is not a simple system to adopt. To do it right requires significantly more planning and coordination than traditional supply practices, project leaders with specialized training and expertise, and full buy-in from the contractor. It also requires a construction equipment supplier capable of this rapid material delivery, and clear lines of communication between that supplier and the site. When it is implemented successfully, however, it can significantly improve both the budget and time-line of a given project.
The cost savings of JIT delivery extend beyond physical goods. This method is changing the way construction projects are organized by encouraging an assembly line-style process that prioritizes each stage of a project sequentially. Under this structure, crews rotate in and out to complete specific phases of a project, with the materials needed for each stage delivered as it occurs. This system minimizes the amount of time work crews are unnecessarily overlapping with one another, with the added benefit of further preserving laydown space for only the materials needed at the moment. Less space consumed by supplies means increased safety as well; cluttered construction sites are a common cause of workplace injuries.
Beyond financial benefits, JIT delivery’s efficient allocation of resources – both supply and human – can lead to significant time savings as well. This approach was applied to the construction of 3 new restaurants at the new Encore Casino in Everett and the results were clear: project turnaround time dropped to just 7 weeks, compared to 15 weeks for similar projects using traditional delivery methods - a 53% decrease.
The Encore Casino may have been the most prominent test case for JIT delivery, but it is far from the only one. Contractors across New England are increasingly finding that finding rapid-response materials suppliers is worth the investment. It seems likely that as Boston’s building boom continues, more and more projects will make use of this system to save time, space, and finances.Gary Wade is the President of Eastern Site Supply. He has more than 20 years of experience in construction, contracting, and material supply.