Is The 9th Waste Sabotaging Your Lean Efforts?

Is The 9th Waste Sabotaging Your Lean Efforts?

Here’s a concept that was taught to me by Rick Boesch about the ninth waste in construction, and it’s a fantastic concept, and I absolutely love his thinking on it. The ninth waste is unhealthy conflict or a lack of alignment, where people are pulling in different directions with counterproductive behavior. And if you think about the eight wastes, they all tie together. But the ninth waste is huge. In fact, there are five external factors in systems thinking that create the ninth waste, and I’m going to walk you through them.

And then I’m going to give you Rick’s solutions for how to eliminate it.

The Pain of Unhealthy Conflict and Lack of Alignment

So what is the ninth waste in construction? Now, I’ve thought a lot about this, and I’m going to build off of what Rick says, and he’s right, by the way, and I consider him to be a mentor. Unhealthy conflict is the ninth waste, or a lack of alignment, where people are pulling in different directions, counterproductive behavior.

And this makes sense to me, because if you go through the eight wastes in the Paul Akers order, which I prefer, overproduction brings about excess inventory, which has to be moved, which is motion and transported, which is a waste. Those two things, and being so busy that you take your eye off quality, creates defects. Moving things and not doing it right the first time creates defects. Then when you have to fix that, that’s over-processing, which creates waiting workers waiting on work or work waiting for workers. And it’s all a waste because we could have used the genius of the team.

But the ninth waste is unhealthy conflict within the team or a lack of alignment. Those are two very different things not using the genius of the team versus just outright fighting. And you could loop them together, but to talk about this and not adulterate the original eight wastes, we want to talk about it in this light. So it’s unhealthy conflict.

Let me go through the concepts one by one, what they mean to me. I don’t want any disparity between what I say and what Rick says, so you can reference his blog post. But let me tell you this: in my opinion, the ninth waste is huge.

The Five External Factors in Systems Thinking That Create the Ninth Waste

In fact, there are five external factors in systems thinking that I’m always focused on that we’ve put in the book Elevating Pre-Construction Planning.

External Factor One: Ability to See the Paradigm

Does the owner of the building see the paradigm of finishing on time and respecting people? If not, you’ll have the ninth waste.

External Factor Two: Paradigms and Mindsets

Does the owner, owner’s rep, designer, or actually within your own company the general contractor company leaders, or trade partner company leaders do they see the paradigm and have the mindset of finishing on time well with operational excellence and caring for people? If not, you will have the ninth waste. You’ll have unhealthy conflict.

External Factor Three: The Goal of the System

Now, this might sound funny to you, but the goal of every project is not to finish on time and respect people. If you have a superintendent that keeps everything in his head, the goal is for that superintendent to feel important. If you have a project where the owner’s rep is grandstanding and beating up the general contractor, the goal is not to finish on time and respect people. The goal of that project is for that owner’s rep to make a name for himself. That’s the goal.

So if you don’t have the goal properly aligned by all and agreed to by all, you will have the ninth waste: unhealthy conflict in construction.

External Factor Four: The Structure of the System

If you are attempting to do one thing as the contractor on the side, but the structure of the team, the structure of the contract, the structure of anything that affects your work is not in line with Lean thinking, then you will have the ninth waste.

External Factor Five: The Rules of the System

A great example would be: you have to use CPM, you don’t get any float, you cannot get a time extension if it’s not on a critical path, you must put a worker in every zone, you must recover with additional resources or overtime. All those things are going to crash-land your project or put your project into a downward productivity spiral. They’re not going to help. So they’re going to create the ninth waste in construction.

And so I just want you to know that this is such an important topic. We have to have an integrated team, integrated location, co-location, integrated communication systems, integrated goals, integrated contracts. That’s why I love IPD so much.

Here are the five external factors that create the ninth waste:

• Ability to see the paradigm does everyone see finishing on time and respecting people as the goal?
• Paradigms and mindsets do leaders have the mindset of operational excellence and caring for people?
• The goal of the system is the goal actually to finish on time and respect people, or is it for someone to feel important or make a name for themselves?
• The structure of the system is the team, contract, and work structure aligned with Lean thinking?
• The rules of the system do the rules (CPM, no float, no time extensions, mandatory overtime) create downward spirals?

If any of these are misaligned, you’ll have the ninth waste: unhealthy conflict and lack of alignment.

Misconception One: Lowest Price Equals Best Value

Rick talks about misconception number one, which is that lowest price equals best value. And it doesn’t. Lowest bid never means lowest overall total cost. You get a low bidder that’s going to change-order you to death. That cost is going to be more than what a reasonable cost would have been. We’ve got to get rid of this thinking that we have to select the low bidder or we have to select the most irresponsible player.

Here’s the way Rick explained this to me. When you select based on low bid, you are intentionally incentivizing the contractor to spend the least amount of time on your project as possible. Because as Rick says, we sell time, and so labor hours cost money. So when you reduce the cost, you reduce the time, you reduce the care, you reduce the end product, the quality of the end product. It’s insane. We must get away from this.

Here’s the truth: low bid incentivizes the contractor to spend the least amount of time on your project. They sell time. Labor hours cost money. So when you reduce cost, you reduce time, care, and quality. And you get change orders, rework, delays, and conflict. That’s the ninth waste.

Misconception Two: You Can Shed Risk for the Owner

The second misconception, which is number two, is the concept that you can shed risk for the owner. I hate this one, and I’ll liken it to surveying. I remember helping in Southern California a massive top 100 ENR company help with their field engineering. And I remember that they were about to get rid of field engineers, and their excuse was, “Well, we should just shed the risk to the surveyor.”

But they had buildings five feet in the wrong spot, elevation busts like eight inches here, two or three feet there, problems everywhere that the team was dealing with. And so because they’re intelligent, I won’t tell you who it is, they switched their focus from “forget this, none of our surveyors are actually paying for these big mistakes, we are.” We’re going to beef up our field engineering department with surveyors and get it right the first time, because there’s no such thing as shedding risk.

Because at the end of the day, is the surveyor going to come fix the building? Are they going to move it five feet in the other location? Are you going to sue them and put them out of business and get your money back? No, no, no. You’re going to eat it. It’s your butt. So you might as well get it right.

This concept of shedding risk is ridiculous. When you shed risk to somebody, they’re going to start acting in a manner that protects them: buffers, lack of transparency not buffers in Takt planning, but like they’re going to pad, they’re going to sandbag, I should have used the word sandbag they’re going to protect themselves. They’re going to be less transparent. They’re going to CYA. They’re going to pay for additional insurance above what’s needed. They’re going to hire lawyers and go into arbitration more than we need to. People are going to defense up. They’re going to armor up. And it’s going to hurt the project.

There is no such thing as entirely shedding risk. There’s responsible risk allocation, and I’ll tell you, more importantly, risk mitigation or risk reduction. And all of these result in conflict, and unhealthy conflict at that.

The Three Solutions to Eliminate the Ninth Waste

So Rick gives a couple of suggestions, which I want to give to you right now, and then you can dig further, because this is a great concept.

Solution One: Focus on the Team

One of the first things that you can do is focus on the team. Build the team. Build trust. Build connection. Build good contracts. Build a good environment to where it’s mostly built on trust. Yes, you have your legal documents. Yes, you have your contracts. But it’s mainly built on trust and you have a great relationship. Spend more time there.

Solution Two: Focus on Risk Mitigation, Not Risk Transfer

The second one that I loved was focus more on risk mitigation than risk transfer. Lean in as a team and make sure that we’re getting rid of the risk instead of just pawning it off on somebody else. This will do so much, so much for your work, and to eliminate the ninth waste.

Solution Three: Remove the Focus on Price

The third one that I love: remove the focus on price. Literally go after best value, because low bid is almost never lowest overall total cost. So make sure that you’re hiring based on qualifications and best overall value, which also means that you’re paying for pre-construction planning, which is the statistical indicator of whether or not a project will go right or not. Pre-construction planning is absolutely key. And if you do this with transparency, you’re heading in an amazing direction. If your project needs superintendent coaching, project support, or leadership development, Elevate Construction can help your field teams stabilize, schedule, and flow.

A Challenge for Leaders

Here’s what I want you to do this week. Look at your project. Are you seeing the ninth waste? Unhealthy conflict? Lack of alignment? People pulling in different directions? If yes, check the five external factors. Is the paradigm aligned? Are the mindsets aligned? Is the goal aligned? Is the structure aligned? Are the rules aligned?

And then apply Rick’s three solutions. Focus on the team. Build trust. Focus on risk mitigation, not risk transfer. And remove the focus on price. Go after best value instead of low bid.

As we say at Elevate, the ninth waste is unhealthy conflict and lack of alignment. Stop low-bid thinking. Stop shed-risk mentality. Focus on team, risk mitigation, and best value.

On we go.

Frequently Asked Questions

What is the ninth waste in construction?

Unhealthy conflict or lack of alignment where people pull in different directions with counterproductive behavior. It’s not using the genius of the team or outright fighting.

What are the five external factors that create the ninth waste?

Ability to see the paradigm, paradigms and mindsets, the goal of the system, the structure of the system, and the rules of the system. If any are misaligned, you get conflict.

Why does low bid create the ninth waste?

Because low bid incentivizes contractors to spend the least time on your project. When you reduce cost, you reduce time, care, and quality. That creates change orders, rework, and conflict.

Why can’t you shed risk to someone else?

Because at the end of the day, you’re going to eat it. The surveyor won’t fix the building. And when you shed risk, people armor up, sandbag, CYA, and become less transparent. That creates conflict.

How do you eliminate the ninth waste?

Focus on the team and build trust. Focus on risk mitigation instead of risk transfer. Remove the focus on price and hire based on qualifications and best value instead of low bid.