1. How has Lean Construction Contributed to our Corporate Strategy? Trond Bølviken Director, Veidekke Entreprenør 29 th October 2015 1

2. Agenda Who, what and where is Veidekke? The main Contributions of Lean Construction to Veidekke Is it working? Concluding remarks 2

3. Who, what and where is Veidekke? Norway’s largest and Scandinavia’s forth largest contractor and property developer 7,000 employees Annual revenue of GBP 2 billion Noted on the Oslo Stock Exchange 51% of the employees own 18% of the company Has made a profit every year since 1936 DENMARK 8% of revenue NORWAY 67% of revenue SWEDEN 25% of revenue CONTRACTS Public 30% Private 70% Non-Residential 35% Residential 20% Industrial 15% Civil Engineering 30% OPERATIONS 3

4. Trond Bølviken Civil Engineer from Norway University of Science and Technology (NTNU), 1979 Director of Strategy, HR and HSE Worked 21 years at Veidekke Head of business unit: 7 years Current position: 14 years Member of Norwegian top management: 16 years Lean Construction Attended my first IGLC-conference in 2004 Local Chair of IGLC in Oslo 2014 Author of several IGLC-papers 4

5. The main contributions of Lean Construction to Veidekke (this far) Strategy Planning Safety 5

6. Economical Process Social Process Logistical/ Physical Process THE CONSTRUCTION PROCESS Reference: Bjørn Andersen, Trond Bølviken, Hege Skårbekk Dammerud and Sol Skinnarland: Approaching Construction as a Logistical, Economical and Social Process, IGLC16 (2008) 6

7. Lauri Koskela Glenn Ballard and Greg Howell How should we understand production? And how should we apply this understanding to construction? How should we understand production? And how should we apply this understanding to construction? What kind of production is construction? References: Lauri Koskela: An exploration towards a production theory and its application to Construction, PhD-theses (2000) Glenn Ballard and Greg Howell: What Kind of Production is Construction?, IGLC 6 (1998) 7

8. Peculiarities of Construction Production is moved to the product (not the other way around) Production runs through the product (not the other way around) Project production 8

9. Mass Production Order Production Production by Rotating Labor Project Production Permanent Organization Temporary Organization Similar Products Unique Products Reference: Trond Bølviken: On the Categorization of Production: The Organization – Product Matrix, IGLC 20 (2012) 9

10. Mass Production Order Production Production by Rotating Labor Project Production Permanent Organization Temporary Organization Similar Products Unique Products Volume and Standardization Standardized Roles Flow Collaborative Planning Integrating all Competence Productivity Strategies Reference: Trond Bølviken: On the Categorization of Production: The Organization – Product Matrix, IGLC 20 (2012) 10

11. INVOLVING MULTI-LOCAL 11 The Strategy of Veidekke (in the language of Veidekke)

12. We execute projects We are a producer Production is a core activity Production is a strategic issue 12

13. Planning of design and production 13

14. Project based production Management and leadership through planning Collaborative planning Time Site Manager Foreman Crew-leader Workers 14

15. Mass Production Order Production Production by Rotating Labor Project Production Permanent Organization Temporary Organization Similar Products Unique Products Physical Protection and Standardized Work Standardized Procedures and Roles Physical Protection and Specific Risk Understanding Risk is Identified and Reduced Collaboratively by the Entire Organization Safety Strategies Reference: Trond Bølviken: On the Categorization of Production: The Organization – Product Matrix, IGLC 20 (2012) 15

16. Michael Porter Strategy involves creating “fit” among a company’s activities. Reference: Michael Porter: What Is Strategy?, Harward Business Review (1996) 16

17. 17

18. Collaborative Planning in Veidekke 18 2013: The first Veidekke guide to Collaborative Planning in Design 2012: The integration of time scheduling, site logistics and safety risk management 2008: The first Veidekke guide to Collaborative Planning in Production 2006-2008: Tests in all 4 branches 2003: The first project testing Last Planner It’s not a quick fix

19. Do you work in a project using Collaborative Planning? 6 principles of Collaborative Planning 0%50% 100% We remove constraints systematically 19 0% 50% 100%

20. Is it working? Profitability Safety 20 All injuries 201220132014 per. August 2015 200920102011 2012 2013 2014 Q2 2015

21. Our collaboration with the academic Lean Construction community What has come out of it? From the Last Planner to our concept of Collaborative Planning Theory has contributed to our language and understanding Studies on time losses The expansion of Collaborative Planning to design and safety risk management 21

22. Concluding remarks 1.We must base our strategy on an understanding of project production 2.The way we plan and produce is a strategic issue 3.Strategy is a question of the fit between its building blocks 4.Collaborative planning has the potential to act as core in a holistic strategy 22