Learning Points From A German Platform For Housing Management Essay

Purpose – This research analyzes the execution of a German platform for lodging undertakings – as a successful instance on Modern Method of Construction having efficient onsite building. Through uninterrupted development has the platform carefully been designed to accommodate a carefully selected market – optimising cost and value. Based on the platform, the company has managed to make a high quality merchandise at low cost. In fact, they have managed to cut down costs by more than 30 % . This has opened a new market for householders that usually have would non been able to afford a place of their ain.

Design/methodology/approach – The paper adopts a instance survey attack combing a qualitative aggregation of empirical stuff with an analytical model pulling upon classical modeling techniques for development of merchandise platforms.

Findingss – The paper identifies some cardinal larning points from the German platform such as ( 1 ) Platform does non connote that “ off site fabrication ” is the most optimum production method ; instead it is a affair of managing complexness ( 2 ) Strong committedness and trueness from the whole organisation is needed ( 3 ) Importance of holding a specific client focal point ( aim bing ) ( 4 ) Incremental instead than extremist invention.

Originality/value – The findings challenge the predominant apprehension of industrialisation of the building processes, exemplifying that significant betterments can be achieved through platform thought, unmoved production and traditional building patterns.

Keywords: lodging, invention, mass customization, platforms, Germany.

Paper type: Case survey

Introduction

The building industry is frequently criticized for its inefficiency compared to other industries, its inability to introduce, to better its patterns and to supply value for its clients ( Egan, 1998 ) . A symptom of this cardinal challenge is that the building costs have increased by approx. 4,6 % per twelvemonth for the last 20 old ages ( DS, 2010 ) .

Several schemes have been suggested for get the better ofing the skyrocketing building costs including increasing usage of digital engineerings and through the re-application of industrialised ways of working.

In the UK, offsite fabrication ( OSM ) has been “ re-branded ” loosely within the term MMC “ Modern Methods of Construction ” ( Gibb, 1999 ) . Ironically, the term “ Modern ” brings to mind the period of “ modern architecture ” where industrialized ways of working based on scientific direction were applied in the building industry.

With the increasing political involvement in the UK, OSM has attracted research focal point over the last decennary. Approximately, ?5 million had been invested by the UK authorities in research undertakings that included building OSM between 1997 and 2001. This figure grows to ?10 million when industry support is taken into history ( Gibb, 2001 ) . Furthermore OSM have been supplemented by a government-sponsored publication of 150 cameo instance surveies ( Builoffsite, 2006 ) , which has late been expanded to 189 ( Builoffsite, 2010 ) .

In this sense, OSM is capable to an increasing involvement among policymakers, research workers and stakeholders in the industry. The latest findings from 36 big building administrations suggest OSM is a portion of the hereafter of the UK building industry ; with a considerable belief that the industry is ready to encompass OSP ( Nadim and Goulding, 2010 ) . This tendency is non merely seen in the UK but besides found in states as Australia ( Blismas and Wakefield, 2009 ) , Japan ( Gann, 1996 ) , the Nordic counties ( Thuesen and Jonsson, 2009 ) and Germany ( CIRIA, 2004 ) .

A broad scope of instances surveies have been undertaken to research the benefits and challenges of OSM. Gibb ( 2001 ) discusses 5 historical and present instance surveies covering a broad scope of edifice concepts and most late Buildoffsite ( 2010 ) presented 189 cameo instance surveies across all sectors of building from residential through to civil and commercial.

The prevailing application of industrialised production methods is normally Off Site Manufacturing ( OSM ) – a development which is discussed and supported done enterprises as Manubuild ( Eichert and Kazi, 2007 and Kazi et Al, . 2009 ) and reflected upon in the particular issue of the Construction Innovation vol 9 issue 1 ( Arif, 2009 )

An underlying apprehension in this development is than an increased usage of offsite fabrication is a requirement for increasing efficiency in building in general. However MMC can besides include advanced site-based methods, such as usage of concrete molds while still using industrialized design and production rules. An illustration of this a platform for lodging developed by the Nordic contractor to the German lodging market. Compared to OSM, the German platform is based on traditional building patterns and unmoved production while still presenting most of the benefits subscribed to OSM ( Thuesen and Jonsson, 2009 ) . As an illustration, the cost of building has been reduced by more than 30 % the past 14 old ages, doing the German platform a success and interesting instance for farther apprehension of MMC.

Aim

The aim of the research is to do an in-depth qualitative analysis of the German platform and thereby convey frontward cardinal larning points for lending to the hereafter development of MMC.

Analytic model

In order to qualify how to utilize platforms in the building industry, the research draws upon a long-standing tradition within classical merchandise development – platform thought. The application of platform thought is normally good known in classical product-oriented industries as a scheme for leveraging economic systems of graduated table through standardisation across merchandises. However, it is more or less unknown in the project-based building industry.

Harmonizing to Gibb ( 2001, 308 ) , those taking standardisation earnestly in the building industry have ever struggled to decide the struggle between uniformity and fluctuation, between maximal standardisation and flexibleness. He continues that standardisation plants by guaranting accurate and exchangeability of constituents. Thus the most of import country for standardisation is really the interfaces between the constituents instead than the constituents themselves. This challenge of managing standardisation and flexibleness is cardinal in platform schemes.

The classical and likely most famed definition of a merchandise platform is “ a set of subsystems and interfaces that form a common construction from which a watercourse of derivative merchandises can be expeditiously developed and produced ” ( Meyer and Lehnerd, 1997, p. 39 ) . Although this definition is targeted to merchandise environments, it is applicable in project-based industries as illustrated in the application for the design and on-site production complex procedure workss, such as spray drying workss ( Haugh et al. , forthcoming ) and cement mills ( Hvam, 2006 and Hvam et al. , 2008 ) or insulin and enzyme mills ( Ladeby et al. 2007 ) . These types of undertakings portion some cardinal features with the building industry:

They are big and complex – multi-technological and multidisciplinary, with complex system relationships.

Each works is dimensioned and designed separately to run into a peculiar client ‘s demands.

A figure of points of position have to be taken into history when planing the person works, such as demands for the procedures which the works must execute, production capacity, the monetary value for presenting the works, running costs, working environment, environmental considerations etc. There is a clear focal point on the user ‘s and operator ‘s demands.

A figure of different histrions are involved in the industry of the complete works, such as providers, advisers, assembly companies on the site, contractors etc.

The undertakings are frequently performed as turn-key undertakings ( matching to a bundle contract in the edifice industry ) , i.e. the manufacturer of the works takes on the full duty for the design, production and assembly on site of the complete works, including the duty for organizing with all the advisers and providers which are involved.

The implicit in premiss of platform-thinking is a separation of creative activity of client value and decrease of cost – a characteristic it portions with Lean thought ( Womack and Jones, 2003 ) . But unlike the application of tilt in “ Mass Production ” environments ( thin production ) which tends to associate to stable/standardized merchandises, platform-thinking marks flexible products/projects. Furthermore, Platform-thinking ‘s focal point on prying economic system of graduated table by standardisation across projects/project differentiates it from the Thin application in building ( Lean Construction ) which is inscribed in the prevailing “ single customization ” paradigm in building which fails to leverage similarity across undertakings by entirely concentrating on orienting alone edifices to each client.

By turn toing the challenge of equilibrating flexibleness and standardisation across products/projects Platform-thinking inscribes itself in a Mass Customization paradigm illustrated in the authoritative definition of Mass Customization as “ aˆ¦producing goods and services to run into single client ‘s demands with close mass production efficiency ” ( Tseng and Jiao 2001, p. 685 ) .

Thuesen et Al. ( 2009 ) illustrates in the conceptual figure 1 how the separation of client value and production cost is organized in different production paradigm like Mass Production, Customization, and Individual Customization.

Take in Figure ( 1 )

The figure illustrates how customization and low costA traditionally have been perceived as reciprocally sole. You can either follow a Mass production scheme supplying low cost but at the disbursal of uniformity and value creative activity or you can follow an single customization scheme making high value presenting alone undertakings but neglecting to command complexness and thereby maintaining the cost down. Mass customization attempts to bridge these two schemes presenting customized products/projects while maintaining cost down by commanding complexness.

The handling of complexness – cardinal to mass customization and platform development – is supported by assorted patterning engineerings ( e.g. Hvam, 2001 and Hvam and Jensen, 2007 ) . This research draws upon the Product Variant Master ( PVM ) methodological analysis which is exhaustively described in ( Hvam et al. , 2008 and Mortensen et al. , 2008 ) and has proved applicable in complex merchandise scenes.

The basic thought of PVMs is to enable companies to depict and analyse their merchandise portfolio and platform from different positions – therefore doing it possible to optimize the relationship between client value and production costs.

Inspired by the PVM, the German platform is analyzed from different positions – as illustrated below.

Market and client position ( What market and clients do the platform reference? )

Undertaking platform position ( How is the platform designed? )

Process position ( How are merchandises developed and produced based on the platform? )

Besides the analysis of the platform from the different positions, the qualitative and quantitative consequences achieved will be presented.

Method

As the paper merely analyzes one instance, the aspiration is non to do classical quantitative survey. The aspiration is to make qualitative penetrations from this peculiar instance ( Yin, 2002 ) – raising cardinal larning points, which later can be capable to more elaborate quantitative and qualitative analysis.

This article is a farther development of the analysis of the German platform presented in ( Thuesen and Jonsson, 2009 and Thuesen and Hvam, 2009 ) .

The paper draws upon an extended internal analysis from the contractor of the German platform ( Contractor, 2008 ) . This analysis has later been scrutinized by juxtaposing the analysis with particular empirical stuff for verifying and formalizing the findings of the internal analysis.

The aggregation of empirical stuff consists of observations from two building sites the 21st February and 10th April 2008, coupled with semi-structured interviews ( Kvale, 1996 ) of individuals in relevant parts of the administration from craftsmen to site applied scientists to managers. By inquiring the individuals similar and different inquiry based on their place in the administration it was later possible to place a consistent organisational apprehension of the platform. The interviews have been supplemented with internal certification of the German platform such as presentations, studies, drawings, gross revenues stuff and computations.

The results of the observations, interviews and certification were triangulated against the findings of the internal analysis. The findings are reported below.

Analysis

The German platform for house edifice has been developed since 1994. Back so, and up until now, the administration has faced an utmost force per unit area on the borders, as it operated in a market in recession. The company realised early that the bing building pattern was non able to bring forth low cost houses. They needed to rethink their concern – and they started to develop their platform for lodging. The platform was developed based on the undermentioned demands. It should

Be applicable in 90 % of the markets that the company addressed.

Be designed in regard to German civilization and tradition for industrial production, concentrating on incremental betterment instead than drastic alterations.

Be flexible for bring forthing many different houses like: one household houses, row houses, dual houses and flat edifices up to 6 narratives.

Use a decentralized consecutive production, enabling really little undertakings.

Market and clients: What market and clients do the platform reference?

The development of the platform has been driven by ab initio aiming a specifically selected market. The platform should be able to bring forth places for households that were traditionally unable to afford their ain place and were stuck in the rental market. Consequently, the chief driver of the platform was row houses as they are indentified as being the most cost-effective.

Although the platform addresses the market for inexpensive row-houses it is still adaptable to other markets. On the footing of the platform for individual household row houses, they expanded their usage of the platform to other sections: Apartments in edifices up to 6 narratives, high-end individual household houses and vacation immobiles. This enlargement is illustrated in the undermentioned figure 7, based on Meyer & A ; LerhnerdA?s ( 1997 ) typology for platform development:

Take in Figure ( 2 )

The basic rule in this enlargement is the sharing of the same platform. The acceptance of the platform to the other markets is based on a specific judgement. In this manner, merely a portion of the platform is implemented.

While this enables the execution of well-known solutions to other sections, it is besides a ambitious procedure. This is particularly the instance when the company cooperate with external designers, as they do when they are constructing flats in High End market. Internal designers are hence a requirement as they need to hold an indepth apprehension of how the faculties are put together – like the stairway solution. Furthermore it is of import to hold the platform exhaustively documented so it is possible to accurately gauge the entire effects ( e.g. in footings of cost ) when the interior decorators want to make something which is n’t include in the platform. This is done by invariably specifying, documenting and visualising the platform with a strong support from the top direction.

Undertaking platform: How is the platform designed?

Over clip, the platform has been carefully designed to accommodate the section for low-cost row houses – optimising the cost/value ratio as illustrated in figure 3.

Take in Figure ( 3 )

The cost has been reduced dramatically by concentrating on the cost drivers of the procedure like the outer and inner walls, the stepss, floors, Windowss and doors and building of the roof. The proficient solutions for cut downing cost have carefully been chosen so it would non cut down the quality degree but would optimize the long-run economic system. This is exemplified in the building rule of the burden bearing walls ( the outer walls ) .

The nucleus constituent of the outer walls is 60 centimeter faculties of aerated concrete. The 60 centimeter faculty has been selected as it is easy to work with – it does non necessitate heavy machinery but merely a little lift for assisting the blue-collar workers put them in topographic point.

Based on these faculties, the design dimensions of the houses are defined – as a multiple of 60 centimeter. Furthermore, the Windowss and doors are designed in conformity with this modularity. In this manner merely a really little per centum of the faculties need to be transformed – ensuing in a low complexness, the usage of good known solutions and effectual usage of work resources. In the few instances where the faculties need to be altered – such as the inclined adjustments between the gables and the roof – there is a strong focal point to maintain the costs down. The chosen solution in this state of affairs has been to bring forth these faculties offsite alternatively of allowing the blue-collar workers do it locally.

However, while the modularity enables an effectual building procedure, it is besides seting restraints on the design. This can potentially diminish the value for the client. An illustration of this quandary is the room tallness. Due to the size of the edifice blocks, they have chosen to digest a greater room tallness than normal. From a theoretical position you could diminish the room tallness and thereby salvage stuff – and cost. However, they have identified that the cost would increase due to a demand for an excess dimension of the edifice blocks increasing the complexness due to new operations in the production stage. Alternatively, the greater room tallness is sold as an addition in quality and client value. This quandary between cost and value is illustrated in the undermentioned two images ( Figure 4 ) .

Take in Figure ( 4 )

By accordingly utilizing the 60 centimeter faculty as the basic building rule, they have been able to concentrate their purchased volume, leveraging their bargaining power towards the providers of the faculties. Hence have they managed to cut down the cost even further and at the same clip guarantee a fixed monetary value for a 2-year period, cut downing their hazard for material monetary value additions.

In order to cut down the hazard even further, the building of the outer walls is carried out by the company ‘s ain blue-collar workers – guaranting the initial stage in the “ undertakings ” are realised efficaciously. In some of the other countries like the pluming, the work is outsourced to subcontractors. However unlike traditional building patterns, these subcontractors have understandings for multiple undertakings with the company enabling them to optimise the production flow and use of resources across undertakings.

Procedures: How are merchandises realized based on the platform?

The merchandises of the platform are realized in a procedure having two cardinal stages: a development stage and production stage.

Development procedure

Based on the platform, each edifice is configured to suite the specific site and specific client. In this manner, the platform ‘s flexibleness is carefully designed to fit the specific market.

However, non all of the platform ‘s flexibleness is provided to each client. The existent fluctuation is decided based on local market research. One of the first activities of a development undertaking is the realisation of a “ Munsterhaus ” – a house where possible clients can analyze the quality of the house and do the determinations sing their peculiar house in line with the predefined flexibleness. In some countries, this flexibleness is high as sing pick of the tiles. Here it is possible to take between a few criterion NCC tiles or the client can purchase them in the nearest jobber. The principle behind this “ design ” is that the value it provides the client by far exceeds the cost of supplying that flexibleness.

A cardinal driver in the development of the platform has been NCC ‘s ain activities as developers: in the acquisition of land, the general design of houses, the production, and the reasoning sale to local clients. In this procedure the developer, normally topographic point and purchase unattractive pieces of land as the one below – located near a railway and holding an uneven form ( Figure 5 ) .

Take in Figure ( 5 )

Normally secret plans like this are inexpensive as an effectual usage the land is disputing. However, as the platform enables a floor program with an optimised breadth of 5,5 metre – many houses can be arranged on the secret plan – efficaciously utilizing every mA? . In this manner, the cost can be kept down – carry throughing the demand of the mark market.

Production procedure

During the production stage, the physical realisation of the houses takes topographic points.

This procedure is characterised by a high grade of work readying as it is carefully planned and controlled in order to guarantee the flow of the edifice procedure where merely one trade at a clip is working on a house. By utilizing an archive of standard solutions, a minimum figure of jobs need to be solved unmoved. This facet combined with a high employee trueness and experience ensures that each craftsman knows precisely what he is supposed to make when he enters the house.

An exemplifying illustration of the optimized work readying is the usage of the concluding steps during the production stage. Due to the fixed room tallness, a standard stairway is used in the platform. With caustic protection and impermanent stairss, the step supports occupational safety during building stage. At the terminal of the undertaking, the stairway is assembled harmonizing to the clients penchant with monolithic wooden stairss parquet, concluding pigment coating, wooden bannister, and the impermanent stairss are reused in another edifice under production. This rule is illustrated in the images below ( Figure 6 ) .

Take in Figure ( 6 )

What are the qualitative and quantitative consequences?

Through the last 14 old ages, the company has by the usage of the platform achieved some interesting consequences.

Decreased clip to market by fast undertaking realisation with short planning stage

Maintained an highly high, relevant flexibleness towards the clients

Ability to bring forth with a high degree of quality at low costs

Ability to command their costs

Fewer errors and limited waste as a portion of the edifice procedure.

Scalable platform enables entryway in other markets

Effective use of resources

Fast execution of platform betterments

While these consequences entirely are interesting, the most singular accomplishment of their platform development is the decrease of costs by more than 30 % .

Discussion

Can we larn from the German platform?

One could rightly inquiry whether it is just to compare the German platform to other states and markets? Consequently, it is important to understand under which societal, economical and market premises the German platform has been developed.

Get downing from the last, it is deserving detecting that the German market is much bigger than, for case, the remainder of the Nordic states and this implies that the German platform can aim a niche in the market and still keep a sufficient market size needed for guaranting the Return On Investment ( ROI ) for developing the platform.

Second, it is of import to notice in which cultural and social puting the platform is situated. In Germany, there has been a long tradition for industrialized production – primary driven by the auto industry. This “ industrialized ” manner of thought has shaped German civilization and individuality. Consequently Germans are more used to work within the regulations of the system. The same industrialized civilization has besides developed a labor market, which for better or worse are binding the employees to their employer. Hence the turnover of employees is really low compared to other states, therefore doing it possible to keep and maintain cognition within the company.

Finally, it is of import to detect how the economical recession the past 10 old ages in Germany has affected the platform development. In the same manner that industry civilization and ordinance is take downing the turnover of employees, the effects of the recession have worked in the same way. Thus the high degree of unemployment has resulted in a force per unit area on wages – maintaining the costs down.

What can we larn from the German platform?

Despite these factors, it is interesting that the company has been successful in developing the platform within an economic system in recession. In fact given even the general crises in the planetary economic system today, it is possible to larn from the German platform. In order to convey frontward cardinal larning points, the German platform is juxtaposed in the undermentioned tabular array with OSM, traditional building and experiences from procedure workss.

Take in Table ( 1 )

The larning points from the tabular array above and the German platform are:

Working with a platform does non connote that “ off site fabrication ” is the most optimum production method. High efficiency can be achieved by On-site production. This insight contradicts several of the bing invention dockets working on radically bettering building efficiency like OSM.

No fancy IT-systems are necessary for the execution of platforms. The platform can be situated within a combination accomplishments and civilization. IT-systems can back up the platform development, but it is non the platform in itself.

Strong committedness and trueness from the whole organisation is needed in order to implement the platform.

The importance of holding a market position which centres on the creative activity of client value in the platform development and farther more defines profitable clients.

No projectile scientific discipline is needed and significant benefits can be achieved by utilizing bing building patterns and tools.

It requires in-house designers who know the faculties in the platform

The platform must be defined, seeable, catching and supported by the top direction

It is of import to hold a clear separation between the uninterrupted development of the platform and the production based on the platform.

Based on the platform, the company has managed to make a high quality merchandise at low cost, by consistently equilibrating an optimized solution between cost drivers and value propositions.

This optimisation of the cost/value ratio has targeted a specific market – a new market for householders that usually have been unable to afford a place of their ain. By taking the clients based on their income, they have managed to make an uncontested market topographic point – a market topographic point which has n’t been affected by the general lag in the economic system, due to the changeless demand for inexpensive places. In this manner, has the company realised a bluish ocean scheme – merely like Ryanair.

However non all platforms are successful. In fact, happening a successful mass customization scheme is a challenge. Salvador et al. , ( 2009 ) reaches a similar decision in the analysis of 200 companies that work with mass customization. Their decision was that there is no best manner to mass customize, but “ Directors must orient [ mass customization ] to an bing concern – instead than frailty versa ” ( p79 ) .

In this manner, the development of a platform is a long term larning procedure ( illustrated in figure 8 ) , which – based on some initial determinations and with a changeless focal point on making value and cut downing cost – enable companies to better their concern by systemic incremental invention.

Take in Figure ( 8 )

Decision

This paper has presented and analyzed the German platform for lodging as a successful invention, which can move as inspiration for the farther development of invention activities in building in general and in peculiar the development of platforms as a specific socio-technical scheme. The cardinal findings are that:

Working with platform is non rocket scientific discipline and significant benefits can be achieved by utilizing bing building patterns and tools

No fancy IT-systems are needed for the execution of platforms. The platform can be situated within a combination good defined accomplishments and organisational civilization. This is non to state that IT systems are might hold an influence on productiveness, but productiveness can be reached through other engineerings…

Efficiency does n’t come from offsite fabricating but from continuously larning procedures around a platform, concentrating on repeat and standardisation, and the handling of complexness incorporating markets, projects/products and procedures.

Execution of platforms requires a strong committedness and trueness from the whole organisation – particularly from the top direction

Platforms require long term incremental and systematic invention with a clear separation between the uninterrupted development of and the production based on the platform

The platform needs to be documented, visualized, catching in order to guarantee committedness and alliance from the different parts of the value concatenation.