Efficient Concrete Business Management - Clean, Organized and Profitable

The 5S approach to efficient business management.

One of the hardest lessons for many contractors to learn is the cost of inefficiency. Inefficient crews tend to accept unclean and unsafe work sites, thus promoting a crew mindset that is disorganized and crisis oriented. This combination of inefficiencies is the perfect scenario for the contractor's perfect storm: chaos and fewer profits!

The Japanese are given credit for introducing an efficiency and profitability system many years ago to American manufacturers. Its purpose was to drive cleaner, more organized and efficient production. American industry quickly adapted what it calls "5S" and improved upon its spirit of intent. This program quickly became part of the productivity DNA for many companies, and they quickly seized the opportunity to clean up their organizations and realize greater profits in the doing!

My first introduction to this system was in a Honda automotive plant. Being blown away personally by the results of the 5S process I soon looked for opportunities to share this with the construction industry. Just in the past five to 10 years, a growing number of construction companies have taken a renewed interest in becoming better organized, working safer and providing a more efficient way of accomplishing more profitable results. No matter what you call 5S, its components and processes are needed more today than at any other time.

5S represents a strategy to develop and maintain a working environment that is clean and organized. Such an environment guarantees a better and safer working environment for workers and a more organized system for tools and equipment. On top of these benefits, 5S enables contractors to realize greater profitability as fewer tools are lost and replaced, less equipment downtime is experienced, and more crews are focusing on the right efforts the first time.

Now, let's explore the "S" components of 5S and how they impact your construction company.

#1S - Sort
This demands that any item that is not bolted down to the shop or truck floor or welded to one of our trucks be identified. It means that each item is identified and clearly tagged. The tag can be small and attached by string, small chain or affixed like a sticker. The information on the tag clearly states what the item is, what the part number is and even the purpose for the item. It is also very helpful if the tag states where the item is to be kept when not in use. Often the tags on tools are color-coded so they are easy to spot.

#2S - Set in Order
This suggests that once tools are tagged they are then segregated into a predetermined area where each tool can be easily kept and found. Setting tagged items in order is no different than purchasing a "shadow box" for hand tools such as screwdrivers, hammers, wrenches, etc. Once all items are set in order it is wise to create a "map" of the area so anyone looking for or returning a tool can easily recognize where a tool is to be found or returned. Such a map, often called the "5S Map," is attached to a wall or laminated and kept in a truck cab for tools meant to be stored on trucks when not in use. The 5S Map helps to not only maintain proper placement for stored items, thus creating less "looking for stuff" time spent by many workers, but also serves as a training tool for new workers needing to learn where everything is kept and stored.

#3S - Shine
The third S refers to cleaning. For contractors this means the cleaning of all tools, equipment and vehicles. It should also mean a crew leaves a jobsite as clean as they found it, if not cleaner. I discovered something very interesting many years ago in my own construction company and then later with those contractors who I was consulting with - most workers do not like to work for a dirty and disorganized contractor. While some employees are not the cleanest of people, often driving dirty personal vehicles, it is amazing how many of these same employees will confess to rather working for a contractor who is organized, expects efficiency and is clean!

#4S - Standardize
The fourth S demands that we formalize our effort to tag items, to determine an ordering process for placement of tools, equipment, and even vehicles. This requires that we develop standard operating procedures where helpful in order to educate all workers on how we take care of tools, equipment and vehicles. Standardizing even our cleaning efforts will help develop our workers into alert employees interested in becoming known as a clean company whom customers love to have perform their particular trade.

A very real and key benefit to #4S is that all of this effort tends to positively, and profitably, impact how your workers will actually perform their jobs. It simply goes against human nature that if they are already expected to work with more commitment to organization, cleaning, consistency of quality, etc., that they would somehow become brain-dead at the very instant of performing their work.

Pride is very real and can be observed by even the most casual bystander as one begins to see construction workers who go the extra step to ensure a cleaner jobsite, a better maintained tool or piece of equipment, and a more thorough approach to the actual work. Standardize must become your expectation for yourself and your workers if it is to begin to produce profitable results.

#5S - Sustain
Holding your workers accountable to Standardize the Sort, Set in order, and Shine is at the heart of the fifth and final S. This requires a balance of both proactive support through the creation of standard operating procedures, signs, tags, etc. and the immediate handling of those workers who fail to comply with 5S practices.

To make Sustain your company's mantra is to preach it , encourage it and recognize it daily. Like any new program there may be some extra attention applied in the first few weeks but when the first long hot stretch in the weather or those continuous 65 to 70 hour weeks begin to add up the commitment to 5S can quickly take a backseat.

Owners must lend their hearty support to Sustain the progress made and sustained. Owners must become fanatical about wanting to see their crews work more efficiently, using tools and equipment that are more usable, and being consistent to bring quality, cleanliness and organization to their daily efforts.

5S can be very helpful to your efforts to create and maintain a cleaner and more organized construction firm. Begin your effort by first observing the current mode of cleanliness and maintenance practiced by you and your crews. Record how often tools are broken, how often you have to have someone working on vehicles or equipment. Walk around your jobsites, and your yard, and notice how clean and organized the locations are. Even take note of how long some of your workers seem to take looking for misplaced or lost tools, gas cans, shop towels, truck keys, etc. Start today to make 5S part of your strategy of bringing greater effectiveness and efficiency to your business and watch that profitability start to rise.

Brad Humphrey is a management and system consultant to the construction industry. Brad continues to assist many construction firms through his personal involvement, speaking at conferences, and providing many hours of helpful instruction on CDs and books. You may find many of Brad's materials by going to www.gangboxinc.com or visiting www.pinnacledg.com.