The 4 Pillars of Operational Excellence in Construction

Operational excellence is achieved gradually. For most high-performing contractors and companies, success comes from entering into a cycle of consistently improving operational efficiency: make data-driven decisions, execute with commitment and precision, measure performance to get more data, then make even better decisions and repeat. 

Even the brightest talent and shiniest tech will go to waste without a commitment to mindset, systems and consistency. Every member of the team must: 

1. Be clear on performance targets.
2. Have the capacity for high performance, including tools, processes, knowledge and skills.
3. Pursue the highest level of execution.
4. Develop a culture of high performance that fosters continuous improvement, trust and accountability.

Those make up the four pillars of operational excellence in construction: clarity, capability, execution and culture. Let’s dive in.

1. Clarity

Performance goals should be specific and measurable, ambitious yet feasible and perhaps most importantly, staff and partners should know the exact goals they’re expected to achieve. 

All teams want projects to make money and be completed on time, without defects and without safety or health incidents. But in order to actually achieve those things, everyone working on a project must know: 

• What success looks like today
• The time, cost, quality and safety targets they are chasing
• How their performance will be measured

Tools & Tips

Dashboards and real-time reporting provide people with information about their performance. Dashboards might include data on benchmarks, defects, safety incidents, RFI response times or delays. This creates real-time visibility into how a project’s going. Field data can connect with project controls, helping leadership make faster, more informed decisions. 

Clarity often includes benchmarks and smaller goals needed to achieve larger objectives. This helps people understand what goes into achieving ambitious goals and identify the exact points where a project slips.

Build clarity and goal setting into every part of the day, including: 

• Reporting
• Debriefs
• Performance reviews
• Morning meetings
• Planning
• Communication

Challenges

Information overload is real. People can’t be expected to parse through sprawling datasets related to every KPI.

Defining success for any given day helps people prioritize the metrics they should be monitoring. Further, many dashboards allow for a “traffic light” effect, which is big-picture metrics will be green when on track, yellow when at risk and red when seriously off.

Once they see a KPI slipping, people can click through to see more detailed data to determine where the breakdown is occurring. 

Connecting to Other Pillars

Clarity depends on a culture that promotes collaboration, transparency and trust. Without that, metrics can make people feel fear, shame or resentment. Organizations thrive when people view data as a tool to get better at what they do, as opposed to something that will be held against them. 

2. Capability

In construction, lack of training, outdated systems or overloaded project managers is similar to asking the fastest runners in the world to race in flip-flops. In order to achieve excellence, people need the necessary tools, training, information and time to get there.

Capability comes from systems (CMS, document management software), tools (BIM, digital site diaries) and people development (training, mentoring, enablement). 

Capability needs to be considered at every part of the construction process. Tasks should be realistically planned. Supply chains need to be vetted and accounted for. People need to have the right tools and, just as importantly, they need to know how to use them.

Tools & Tips

Standardize processes, such as templated workflows, embedded checklists, built-in guidance and early inspections to help support more consistent delivery, avoid mistakes and allow workers to focus on more important tasks. 

Challenges

Training takes tim and tools take money. Assessing and building capability often takes front-loaded resources. However, when done deliberately, assessing and building capability now should help improve outcomes later.

For example, retraining team members in specific tasks, such as digital site diaries or defect management tools, can feel like a costly use of resources, but it can significantly decrease rework and delivery times.

Connecting to Other Pillars

The more detailed the KPIs and the metrics, the more helpful they become in identifying the exact breakdown in capability. It’s being able to move past “something went wrong,” and towards identifying is an issue occurred because of planning, manpower, tools, weather, or miscommunications.

3. Execution

Once goals are established and capability is ensured, it’s time to do the work. Execution isn’t about doing more – it’s about doing the right things, consistently. Perfectly planned schedules, systems and workflows still break down when tasks are missed, people don’t show up or lessons aren’t learned.

Execution, just like setting goals, isn’t about, “Just go do it.” Workers excel in execution when they understand exactly what’s expected of them, how they’ll be assessed and benchmarks along the way. 

Tools & Tips

Give people numerous opportunities to understand how they’re doing and effective ways to do better. This might include early inspections, monthly performance reviews, action-based dashboards, subcontractor scoring or project health checks.

Construction management platforms can remove friction from completing regular tasks, such as RFIs, drawing updates, inspection and closeouts. Standardizing and automating workflows can decrease rework and delays, while letting team members focus on the best ways to get to project completion. 

Tech and data help make execution visible, trackable and fixable. When slippage occurs, circle back on performance metrics to identify where a breakdown occurred. 

Challenges

Some people prickle at the idea of being tracked or reflecting on their performance. Good culture helps overcome feelings of being micromanaged or wasting time. People need to understand what they’re working towards and how transparency, communication and accountability contribute to those goals and the culture of the workplace.

Connecting to Other Pillars

Execution is often where culture is built and tested. It’s when people see transparency, accountability and communication are tools towards outstanding performance. As people find success, they become even more invested and excited in creating a high-performing culture. 

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4. Culture

Highly effective organizations move from reacting to problems and issues as they pop up, to proactively identifying problems and clearing the path to success. Culture is how they do that. 

Culture is many things, but it might be easiest to describe as the things team members do when no one is watching. An effective culture conjures a sense of accountability for performance results and an urgency to surpass those targets. People show up on time, observe safety protocols, see data as a means to success, pursue proactive decision-making and value collaboration. High-performance culture means people have account without fear, pride without ego and work towards improving without excuses. 

Tools & Tips

Culture is often about habits and systems. Celebrate consistent and outstanding performance, build feedback loops and link improvement to rewards and career progression.

Technology helps people engage with how their actions contribute to an organization’s culture. Tools like Procore’s observations, tasks and meetings foster transparency and the pursuit of continuous improvement. 

Introduce a policy where project closeout includes teams documenting and sharing five key learnings. This shifts perspectives from moving past issues, or even hiding them, to reflecting on and solving them proactively.

Challenges

Organizational culture exists, whether it’s acknowledged or not. When people show up late, documents aren’t organized and delays are expected on every project, that’s culture too. Building a positive culture of high performance requires deliberate planning and collaboration carried out over a long time.

Connecting to Other Pillars

Culture drives the other three pillars. How people engage with goals, metrics, data, training and day-to-day work is heavily influenced by the culture of their team. 

The Role of Technology & The 4 Pillars

Technology should help establish and maintain clarity, capacity, excellence in execution and a high-performing culture.

Tech can be a vehicle to success, but it requires people to get there. Introducing tech should be done when it helps teams improve the work they do. It should be a deliberate process that explains why a new tool has been adopted, its benefit and how its value will be assessed over time.

Take time to hear concerns and answer questions about new tools. More often than not, people have valid questions and concerns that, when addressed head-on, actually lead to a more effective adoption process. 

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