Reducing Variability to Improve Performance as a Lean Construction Principle

Variability is common on construction projects and must be managed effectively. New management thinking, like that of lean production, has suggested that better labor and cost performance can be achieved by reducing output variability. Efforts to utilize lean thinking in construction, so far, have generated limited evidence to support this claim. This paper investigates the relationship between variability and project performance to test the notion that reducing output variability will result in improved labor performance. Using productivity data from concrete formwork activities on multiple projects, various measures of output variability are tested against construction performance. It is shown that variability in output is inevitable and that there is little correlation between output variability and project performance, but that variability in labor productivity is closely correlated to project performance. It is concluded that lean improvement initiatives should be redirected to adaptable workforce management capabilities to reduce variability in labor productivity instead of output in order to improve project performance.