Supply Chain Management: Just-In-time logistic in construction

Ilya Malyavin (ID: 14840019)

Auckland University of Technology
School of Engineering. MCM

Auckland 2014

1
Abstract
The majority of construction projects in terms of the material logistic can be characterized by
the low value (comparing with manufacturing process) and a high range of the materials
items. Moreover, in the urban conditions makes specific limits for the construction process
such as traffic and lack of space. The site conditions does not guarantee the safety of the
stored materials. In order to reduce the waste in the construction projects and mitigate risks
that relate to the lack of space on the construction site Just-In-Time (JIT) approach can be
used.
This paper outlines the aspects of JIT for the construction industry.

Content
Abstract ...................................................................................................................................... 1
JIT overview................................................................................................................................ 3
Benefits ...................................................................................................................................... 4
Barriers ....................................................................................................................................... 4
JIT implementation .................................................................................................................... 5
Case study .................................................................................................................................. 6
Conclusions ................................................................................................................................ 6
References .................................................................................................................................. 8

3
According to Gudehus and Kotzab (2009) logistic aims to provide the required
quantities of goods most efficiently at the right place in the right order at the right time.
Harker, Allcorn, and Taylor (2007) consider that up to thirty five per cent of material waste in
construction can be reduced by logistic efficiency improvement. One of the tools for the
improvement of the logistic efficiency is Just-in-Time philosophy.
JIT is a management philosophy that has been appeared and widespread in the Japan
manufacturing industry since 1960s (Opfer, 1998). JIT is a part of lean. It puts emphasis on the
waste minimization throughout the continuous improvement. JIT is a pull system concept that
includes delivery of materials just when it is required and where it is required for the provision
of the production processes (Lai & Cheng, 2009).
Just-in-time logistic (JIT) is a service of frequent deliveries in work packs, pulled for
delivery to the workplace in time for the trade to perform the next task and minimize on-site
storage (Harker et al., 2007). In spite of originally JIT was designed for the manufactory this
philosophy can also be implemented in the construction industry in order to improve
productivity and profitability of the projects with respect to the quality (Low Sui & Gao, 2011).
JIT overview
Lai and Cheng (2009) combine the elements of JIT logistic in three groups:
1. People contribution. People tolerance is one of the most significant factors for the
implementation of JIT. Involvement of all stakeholders is essential. The JIT vision should be
clearly explained to the stakeholders. It would be impossible to achieve the best results
without effective communications and collaboration between stakeholders. On the
implementation stage the management support is required as well for the organizational
changes. Additionally, the government may provide the trainings and appropriate strategy
in order to support companies and facilitate adoption of the JIT approach in the industry.
2. Logistic network. JIT assumes the changes in the traditional logistic. There is a number of
tools can be used to achieve the best results of JIT, namely Kanban, multi-skilled staff,
demand pull, self-inspection and others.
3. System that includes processes and technologies for the planning, coordination and
control of the resources and logistic network within the project or company.
JIT assumes gathering of the materials
from the suppliers and vendors and
transportation on site. Figure 1 illustrates
interrelationships between the supply chain (SC)
elements and the place of JIT in the material
supply stages. JIT should be taken into
consideration for the procurement system and
contractual relations decision making as it
require the cooperation of all stakeholders,
including suppliers and contractors (Akintoye,
1995).
The materials are purchased by small
values on the frequently basis and should be
delivered right before the planned installation.
Thus the supplier is responsible for the

Figure 1 JIT in supply chain (retrieved from Akintoye, 1995)

4
prescheduled delivery and contractor should provide the preplanned demand or inform the
supplier about changes in advance (Akintoye, 1995).
Benefits
JIT aims to minimize waste of materials, time and efforts in logistic and increase logistic
efficiency (Lai & Cheng, 2009, p. 23).
Kim, Azari-N, Yi, and Bae (2013) state that JIT with prefabrication approach decrease
the impact of the construction process on the environment by reduction of the transportation
value. It is also reduce the impact of the construction on the traffic that may play the main
role in urban conditions especially for the large projects. One of the recommendations that
they provided to achieve this benefit is education of the contractors.
Additionally JIT reduce on-site storage related risks such as materials damage or theft
(Harker et al., 2007). Construction site conditions often do not allow to guarantee materials
safety. The damage can be caused by plant, personal, equipment, weather, etc. In order to
avoid these risks JIT approach can be a solution for the critical materials such as structural
element (Ying, Tookey, & Roberti, 2014).
In spite of the implementation of JIT requires additional expenses it provides the longterm savings and risks reduction for the contractors and suppliers and consequently improves
the construction efficiency and reduce construction cost for the owners (Akintoye, 1995).
Implementation of JIT may help contractors to save up to fifteen per cent of materials and
labour costs (Sullivan, Barthorpe, & Robbins, 2010, p. 19)
From the suppliers point of view JIT implementation in the construction industry
would enable to decrease uncertainty in the demand and lead to the savings by storage
minimization and over- or under-production (Akintoye, 1995).
Barriers
The construction project is characterized by the small value of specific materials in
comparison with manufactory and a numerous specification positions. Thus, JIT requires a
good project infrastructure that includes people skills and technologies. Inadequate staff
attitude sometimes lead to the ignoring of the potential problem before it becomes the real
one. The delay in planning and managing in two days may lead to the two months delays in
the project (Opfer, 1998).
JIT logistic implementation may include the following barriers: lack of support
(including technical, financial, employee, engineering and management); lack of product
quality; lack of communication (Lai & Cheng, 2009, p. 142) Moreover, construction process is
influenced by uncertain factors such as weather or environment, additionally complex
projects include big range of tasks and process that make planning for JIT in construction
complicated (Sullivan et al., 2010, p. 21)
Lai and Cheng (2009, pp. 25-27) outline the following weaknesses of the JIT:

JIT requires high level of culture and internal communications between workers as it is
assumed that the process is well structured and synchronized. It could be difficult for the
employees to achieve the sufficient level of collaboration. Furthermore, the external
stakeholders culture is also significant for the success of the JIT system as they need to
provide services and deliver materials exactly in the right time.

The minimal storage increase risks in case of the unpredicted demand. Thus it could lead
to the outage because of the waiting of additional materials.
JIT is very sensitive to the transportation issues. It requires the responsive transportation
system to prevent delays in logistic and in the whole construction process.
The manufacturers and suppliers are also become critical for the project success in case
of JIT utilization. In case of the failure or closing of the manufacturer the project may
standstill before the new one is found as there is minimum or no stockpile.
JIT may add pressure and discomfort on the employees as traditionally there are inventory
and materials that can cover the mistakes and human errors. Additionally, JIT requires
managers to pay a short-term attention on the operations instead of long-term project
success. Thus it is required the acceptance and tolerance from the staff of all levels to the
JIT implementation.
JIT implementation

The JIT implementation on the construction site should be managed by the contractor
based on the experience and reliability of the suppliers. The logistic plan should be negotiated
with suppliers and consider opinions of all relevant stakeholders of the logistic process. The
effectiveness of the communications is one of the most significant factors for the successful
implementation of JIT (Akintoye, 1995).
Lai and Cheng (2009, pp. 159-165) suggest the following actions for the JIT
implementation that can be adopted for the construction projects:
1. Management commitment is the first essential step for the implementation of JIT. The
senior management should provide the JIT vision for the all stakeholders. In the
construction environment the general contractor should set the strategic decision for the
JIT implementation in the project from the initial stages. The management commitment
can be set and spread through the briefing process.
2. Implementation team. The next step in implementation is definition of the measures and
goals for the JIT. The goals could vary depending on the project it could be zero-waste
construction or improvement of the productivity. The detailed design of the
implementation should be completed by the project team or subcontractors. Team should
be responsible for the development of the measurable criteria and assessment of the
required resources for the JIT implementation.
3. Standardization that aims to improve quality and set the clear action plan for the team.
The standard procedures may include forms and rules for ordering or scheduling logistic.
It also may be implemented in the whole project for instance toolkit for the weekly
coordination meetings.
4. Awareness of employees about JIT philosophy and strategic goals. As the JIT efficiency is
highly dependent on the staff it is essential requirement to inform and educate people in
order to create the right cultural environment in the project.
5. Logistic manager and supervisor trainings aims to provide required education for the
responsible persons. It is assumed that managers would facilitate the understanding of
the JIT approach and spread knowledge among the project team by expert supporting.
6. Error mitigation is the next significant factor to implement JIT. The identification of errors
should be completed by the project team. There is wide range of possible errors in the
construction logistic for instance the wrong quantitative calculations or failure in the
measurements.

6
7. After the error identification the roots of the problem should be defined and actions for
its avoiding in the future should be developed.
8. Recognition and reward system could be implemented in the project in order to motivate
stakeholders. The sharing risks and benefits would improve the communications and
interest in the project success within the project team that would lead to the improvement
of the JIT effectiveness.
9. Continuous improvement may be even more significant for the construction than for the
manufacturing industry as each construction project is unique and in a large project it is
never the same team as it was in the previous one. Thus the implementation cycle of JIT
should be repeated for the each project.
Case study
One of the best practices of using JIT in construction is BAA Terminal 5. The terminal is
a part of the Londons Heathrow Airport. The project includes two buildings, sixty aircraft
stands, control tower, car park, hotel and surrounding infrastructure. The total cost of the
project is 4.3 billion pounds sterling (Harker et al., 2007).
The project has a number of
logistic challenges. Firstly, it is nearby the
two greatly used runways. There was no
place for the storage materials that made
the project team plan the materials
demand up to one and a half months in
advance (Harker et al., 2007).
During
the
project
the
consolidation center, namely Colnbrook
Logistic Centre, was used. Additionally,
the special booking software - Project
Flow for the stakeholders was
implemented in the project. The software
aimed to organize time for the delivery,
identify suppliers and place and value of
the materials for the consolidation center
(Harker et al., 2007).
The consolidations of the
materials for the delivery on site were
Figure 2 BAA Terminal 5 (retrieved from Harker et al., 2007)
done with utilization of the same
software according to the planned schedule (Harker et al., 2007).
Consequently, the utilization of JIT in the project increased productivity on twenty five
per cent and reduced cost on two and a half per cent (Harker et al., 2007).
Conclusions
JIT approach in construction may provide cost savings and improve productivity. It is
also useful for the urban conditions as it decreases the transportation loads on the traffic. It
reduce or eliminate requirements for the storage space on the construction site and can be
the only solution in case of space limitations.

7
The implementation of JIT requires efforts from all project stakeholders. It requires
additional reliability from project team and high level of collaboration and communication
among them. Thus the main factor for the successful JIT implementation is creation of the
appropriate culture and environment in the construction industry.
The example of the successful project in UK that is presented in this paper proves the
efficiency of JIT approach for construction. However, in spite of the JIT implementation
principles may be successfully applied for the construction projects this philosophy was
developed for the manufactory industry and is not widely spread in the construction sector.
Consequently, the further research is required to adopt it for the different construction
conditions and provide more evidences to convince the industry to uptake it.

8
References
Akintoye, A. (1995). Just-in-Time application and implementation for building material
management. Construction Management and Economics, 13(2), 105-113.
doi:10.1080/01446199500000013
Gudehus, T., & Kotzab, H. (2009). Comprehensive logistics. Heidelberg: Springer Berlin
Heidelberg. doi:10.1007/978-3-540-68652-1
Harker, A., Allcorn, W., & Taylor, D. (2007). Material logistic plan. Good practice guidance.
Banbury, OX.
Kim, Y.-W., Azari-N, R., Yi, J.-S., & Bae, J. (2013). Environmental impacts comparison between
on-site vs. prefabricated just-in-time (prefab-JIT) rebar supply in construction
projects. Journal of Civil Engineering and Management, 19(5), 647.
Lai, K.-h., & Cheng, T. C. E. (2009). Just-in-time logistics. Burlington, VT: Gower.
Low Sui, P., & Gao, S. (2011). The Application of the Just-in-Time Philosophy in the Chinese
Construction Industry. Journal of Construction in Developing Countries, 16, 91-111.
Opfer, N. D. (1998). Just-in-time construction materials management. AACE International
Transactions, P10-P14.
Sullivan, G., Barthorpe, S., & Robbins, S. (2010). Managing Construction Logistics (1 ed.).
Retrieved from http://AUT.eblib.com.au/patron/FullRecord.aspx?p=537375
Ying, F., Tookey, J., & Roberti, J. (2014). Addressing effective construction logistics through
the lens of vehicle movements. Engineering, Construction and Architectural
Management, 21(3), 261-275. doi:10.1108/ECAM-06-2013-0058