Are You Obeying Production Laws or Fighting Them?

You’re fighting production laws and wondering why projects extend. Little’s Law states throughput time equals number of flow units times cycle time. In construction, duration equals number of processes times process time per unit. Only Takt allows you to calculate this. CPM doesn’t allow calculating optimal batch sizes. Doesn’t help reduce work in process. In fact, makes it easy to increase it with forward and backward paths. Doesn’t enable finishing as you go in a rhythm. CPM does not obey this scientific and mathematical law. Rather ends up fighting it. The Law of Bottlenecks says every system has at least one constraint limiting performance. Process with longest cycle time increases overall throughput time. Therefore bottlenecks must be identified, optimized, or eliminated. But CPM can’t visualize trade flow so can’t find bottlenecks let alone optimize them. Critical path focuses on longest network of activities from beginning to end rippling through different trades and different phases. Doesn’t isolate and make visual trade flow within phases. Takt, on the other hand, makes workflow, trade flow, and logistical flow easily visible. Bottlenecks easily seen and easily optimized with standard work steps packaged within Takt wagons. The Law of Variation says as variation increases, throughput times increase. Project end date extends. Must see and prevent roadblocks, create standards and consistency. CPM is so chaotic it’s difficult to see problems and takes so much management capacity there’s little time to prevent them. Takt takes one-twelfth time to manage so team focuses on making work ready and preventing roadblocks.

Here’s what most teams miss. They schedule projects without understanding the production laws governing them. They don’t know Little’s Law determining duration based on flow units and cycle time. They don’t know the Law of Bottlenecks requiring identification and optimization of constraints. They don’t know the Law of Variation showing that variation increases duration. And because they don’t know the laws, they use CPM fighting every single one. CPM can’t calculate optimal throughput times using the formula. Can’t reduce work in process by calculating ideal batch sizes. Can’t finish as you go by showing clearly when to finish sequences in rhythm. Can’t visualize trade flow to find bottlenecks. Can’t create standards reducing variation. The system fights the laws then teams wonder why projects extend and chaos reigns. Because you can’t fight production laws and win. You must obey them. And only Takt allows this.

The challenge is most teams think scheduling is art or guesswork when actually it’s science and mathematics. Production laws govern construction whether you acknowledge them or not. Little’s Law determines throughput time. The Law of Bottlenecks shows process with longest cycle time increases duration. The Law of Variation proves variation extends end dates. These are mathematical certainties, not opinions. But CPM ignores them all creating chaos instead of flow. Takt obeys them all creating predictable outcomes. The formula proves it: number of Takt wagons plus number of Takt areas minus one, sum of that multiplied by Takt time equals throughput time. That’s Little’s Law applied to construction. Scientific. Mathematical. Predictable.

Little’s Law: Throughput Time Equals Flow Units Times Cycle Time

Little’s Law is a theorem that determines the average number of items in a stationary queuing system based on the average waiting time of an item within a system and the average number of items arriving at the system per unit of time.

To simplify this, Little’s Law states that the throughput time, phase duration, or project duration in construction equals the number of flow units or process units in construction times the cycle time. That means the amount of processes in the system multiplied by the process time per unit determines the overall duration.

In construction, this is only calculated with Takt. It enables us to do the following:

• Plan smaller batch sizes.
• Limit work in process.
• Finish as we go.

In Takt, the formula shows the number of Takt wagons plus the number of Takt areas minus one. The sum of that multiplied by the Takt time equals the throughput time or duration based on Little’s Law.

The only way to stabilize and optimize a project is to obey the production laws and not fight against them. Only Takt allows this.

Consider this: Does CPM allow us to calculate optimal batch sizes? No. Does CPM help us reduce work in process? No. In fact, it makes it easy to increase it with its forward and backward paths. Does CPM enable us to finish as we go? Not really. Maybe. But it definitely does not allow us to see when we need to finish in a rhythm.

CPM does not obey this scientific and mathematical law, but rather ends up fighting it.

Takt obeys this law in the following ways:

• Takt allows us to calculate optimal throughput times and use the formula.
• Takt allows us to reduce work in process not only by calculating ideal batch sizes, but also by putting work into a rhythm that makes work happen only when it is needed per the flow.
• Takt allows us to finish as we go by showing clearly and visually when we need to finish sequences, and it puts materials, information, and worker counts into a consistent rhythm so we have the capacity to do so.

The Law of Bottlenecks: Find Them, Optimize Them, Start Again

The bottleneck law has its origin in the theory of constraints created by Dr. Elihu Goldratt and published in 1984 in his book The Goal. The law says that every system, regardless of how well it works, has at least one constraint, a bottleneck, that limits performance.

This law also states that when the largest constraint is optimized or removed, the other bottlenecks will show up in the system. To apply this to construction, we need to understand that the process with the longest cycle time will increase the overall throughput time or duration. Therefore, bottlenecks must be identified, optimized, or eliminated.

In the book The Bottleneck Rules by Clark Ching, the author provides an acronym that might be easy for us to remember: FOCCCUS.

• Find the bottleneck.
• Optimize it. Once you know where the bottleneck is, you can increase the process capacity and reduce cycle time.
• Coordinate with other non-bottleneck work to increase the capacity of the bottleneck.
• Collaborate with other non-bottleneck work and see if those processes can help the bottleneck process.
• Curate the work needed for the bottleneck to reduce the demand on the process.
• Upgrade the resources that compose the process to increase the capacity.
• Start again finding other bottlenecks.

In order to obey the second production law, we must be able to see and optimize bottlenecks. And because bottlenecks are mainly found in the cycle time of a process, we will find most bottlenecks by visualizing trade flow, not just workflow.

CPM does not do this because you cannot see all three types of flow. You can barely see some parts of the workflow, but no one can easily see trade flow and therefore no one can easily find bottlenecks in CPM, let alone optimize them.

The very nature of a critical path focuses on the longest network of activities from beginning to end. Not only does this ripple through different trades, but it also ripples through different phases as well. CPM does not have the ability to identify bottlenecks because it does not isolate and make visual trade flow within phases.

Takt, on the other hand, gets an A-plus for this. In Takt, anyone can easily visualize workflow, trade flow, and logistical flow. And bottlenecks are easily seen and easily optimized with the standard work steps packaged within Takt wagons. Takt is the only scheduling system that obeys the law of bottlenecks.

The Law of the Effect of Variation: Variation Increases Duration

The law of variation is defined as the difference between an ideal and an actual situation. Variation or variability is most often encountered as a change in data, expected outcomes, or slight changes in production quality. Variation in construction usually comes from waste, unevenness, or an overburden on resources.

As variation increases, throughput times or duration increases. That means that as variation increases on our projects, then the project end date will extend. This means that we must see and prevent roadblocks and create standards and consistency.

CPM again fails miserably on both counts. A CPM sequence is so chaotic it is difficult to see problems within the system. It also takes so much management capacity to manage as a schedule, there is very little time to even try doing so. And for the second point, again, CPM is so inconsistent and chaotic, typical and standard work steps are not created to baseline processes and cycle times so that roadblocks can be more easily seen.

Conversely, Takt cares for both considerations. Takt takes one-twelfth of the time to manage as a scheduling system so the team’s main focus can be on making work ready and preventing roadblocks. Takt also creates a visual schedule where it is easy to see roadblocks.

Focusing on Throughput, Not Individual Efficiency

The throughput through the entire system is our focus, not individual efficiencies for trades. We want collective efficiency for trades. We want trades going at relatively the same rate of production. Stated differently, we want everyone to succeed together as a group and to optimize the project, not just their individual companies.

The throughput is defined as the rate at which a certain amount of material or items, or in this case the construction processes, pass through a system or process. More efficient that this process is as it passes through the system or building, the better our throughput.

Individual efficiency is concerned with the production or utilization of individual resources or contractors which does not always help the overall throughput. In fact, it interrupts it. We need all contractors working at relatively the same throughput according to the Takt time in order for there to be flow.

If contractors are working faster or slower than average, it might seem helpful to that individual trade partner’s productivity, but it interrupts the overall throughput, creates variation, then increases inventory levels, which increases defects.

Applying Little’s Law to Balance the System

According to Modig, Little’s Law states that the throughput time is equal to the number of flow units in the process multiplied by the cycle time. In translating this to construction, we can say that throughput time equals the number of areas needing a process multiplied by the process duration.

For example, if the throughput time for the framer equals 10 areas multiplied by 5 days, it would result in 50 days. If the in-wall electrical roughing contractor has a throughput time that equals 10 areas times 10 days, it would result in 100 days.

Let’s now say that the remaining contractors all have throughput times of 50 like the framers. That would mean we need to speed up the electrician. How do we do that? By adjusting resources to match the throughput times of the other trades. We need to get 2 crews and the formula would be as follows: throughput time equals 10 areas times 5 days with 2 crews equals 50 days.

We now have a balanced system and are all going at the same rate together. These are the types of decisions we have to make to optimize the whole of the project sometimes at the expense of individual contractor efficiencies. In some instances, we have to speed up certain resources and slow down others. This is called leveling out around bottlenecks as our strategy.

Takt Requires Discipline and Accountability

With Takt systems, we need to hold the line, keep the rhythm, and be disciplined. Otherwise, we leave the system and the project descends into chaos. Therefore, Takt planning requires project teams to hold others accountable, control the site, and hold the line.

This is very difficult for a team and can be a reason project teams may be hesitant to use the Takt system. It is also why trades may be hesitant to participate with Takt because they will be held accountable. You can be sure that weak leaders and non-accountable trades will not like Takt.

Prefabrication Supports Takt

Takt keeps the system stable and then the team can accelerate when we prefabricate as much as we can. Consistent and stable scheduling systems need to be supported by prefabrication. When a project is entirely stick built, it will generally experience uncoordinated work issues with slow and unpredictable installation rates, which will not fully enable flow.

To be as effective with Takt planning as we can be, we need to prefabricate as much as possible within the project budget. Basically, following an assembly schedule is easier when you can piece it together like Legos or IKEA furniture. We must prefabricate as much as we can to create consistency and flow, and we prefabricate to the beat or rhythm of a production schedule, namely Takt.

The System Failed You

Let’s be clear. When teams don’t understand production laws, it’s not entirely their fault. The system failed by teaching CPM without explaining that it violates Little’s Law, the Law of Bottlenecks, and the Law of Variation. Nobody showed that CPM can’t calculate optimal batch sizes, can’t reduce work in process, can’t visualize trade flow to find bottlenecks, can’t create standards reducing variation. Nobody explained that the formula for throughput time requires Takt: number of Takt wagons plus number of Takt areas minus one, multiplied by Takt time. The system taught ignore production laws when actually obeying them is what creates predictable outcomes.

The system also failed by not teaching that individual efficiency interrupts overall throughput. If your project needs superintendent coaching, project support, or leadership development, Elevate Construction can help your field teams stabilize, schedule, and flow. Contractors working faster or slower than average interrupts overall throughput, creates variation, increases inventory levels, increases defects. Need all contractors working at relatively same throughput according to Takt time for flow. But CPM encourages individual efficiency maximizing resources instead of collective efficiency optimizing system. The system taught wrong metric preventing flow from happening.

The system fails by not teaching FOCCCUS for bottlenecks. Find the bottleneck, optimize it, coordinate with non-bottleneck work, collaborate with other processes, curate work needed, upgrade resources, start again finding other bottlenecks. When largest constraint is optimized or removed, other bottlenecks show up. This is continuous improvement at system level. But CPM can’t visualize trade flow so can’t find bottlenecks. The system taught react to problems when actually identifying and optimizing bottlenecks prevents problems from limiting performance.

The Challenge

Here’s your assignment. Stop fighting production laws. Start obeying them through Takt planning.

Apply Little’s Law. Throughput time equals number of flow units times cycle time. In construction: duration equals number of processes times process time per unit. Formula: number of Takt wagons plus number of Takt areas minus one, multiplied by Takt time equals throughput time. Use this to calculate optimal batch sizes, reduce work in process, finish as you go.

Obey the Law of Bottlenecks. Find them, optimize them, start again. Use FOCCCUS: Find, Optimize, Coordinate, Collaborate, Curate, Upgrade, Start again. Process with longest cycle time increases overall throughput time. Visualize trade flow to identify bottlenecks. Optimize with standard work steps. When largest constraint is optimized, other bottlenecks show up. This is continuous improvement.

Follow the Law of Variation. As variation increases, duration increases. See and prevent roadblocks. Create standards and consistency. Use Takt taking one-twelfth time to manage enabling team to focus on making work ready and preventing roadblocks. Visual schedule makes roadblocks easy to see.

Focus on throughput, not individual efficiency. Want collective efficiency with trades going at relatively same rate of production. Everyone succeeds together as group optimizing project, not just individual companies. Balance system using Little’s Law to match throughput times. Sometimes speed up resources, sometimes slow down. Level out around bottlenecks.

Hold the line, keep the rhythm, be disciplined. Takt requires accountability. Hold others accountable, control the site, hold the line. Otherwise leave system and project descends into chaos.

Support Takt with prefabrication creating consistency and flow. Prefabricate as much as possible to beat or rhythm of production schedule. Assembly schedules easier when piecing together like Legos.

Production laws are scientific and mathematical. Not opinions. Obey them or fight them. Only one option works.

On we go.

FAQ

What is Little’s Law and how does it apply to construction?

Throughput time equals number of flow units times cycle time. In construction: duration equals number of processes times process time per unit. Formula: number of Takt wagons plus number of Takt areas minus one, multiplied by Takt time equals throughput time. Enables planning smaller batch sizes, limiting work in process, finishing as you go. CPM doesn’t allow this.

What is the Law of Bottlenecks?

Every system has at least one constraint limiting performance. Process with longest cycle time increases overall throughput time. Therefore bottlenecks must be identified, optimized, or eliminated. FOCCCUS: Find, Optimize, Coordinate, Collaborate, Curate, Upgrade, Start again. When largest constraint is optimized, other bottlenecks show up. CPM can’t visualize trade flow so can’t find bottlenecks.

What is the Law of Variation?

As variation increases, throughput times increase. Project end date extends. Must see and prevent roadblocks, create standards and consistency. CPM is chaotic making it difficult to see problems and takes too much management capacity. Takt takes 1/12 time to manage so team focuses on making work ready preventing roadblocks.

Why focus on throughput instead of individual efficiency?

Individual efficiency interrupts overall throughput. If contractors work faster or slower than average, it interrupts throughput, creates variation, increases inventory, increases defects. Need all contractors working at relatively same throughput according to Takt time for flow. Want collective efficiency optimizing project, not individual companies.

How do you balance the system using Little’s Law?

Calculate throughput time for each trade: number of areas times process duration. If one trade has longer throughput time, adjust resources to match others. Add crews to speed up. Add buffer to slow down. Result: balanced system with all trades going at same rate together. Leveling out around bottlenecks as strategy.