Lean Construction : Utopia ?

About technology, business & management issues..

Much has been written and read about the latest fad in the construction industry: the lean approach taking back some principles of lean manufacturing.  It's funny how a methodology designed and implemented for the manufacturing industry tend to expand to other industries or service companies.

The construction in Mexico is not immune to this phenomenon: during the last 25 years people have tried to reinvent the wheel. Since the consolidation of professional project management, for over 30 years in America and Europe, and with as little over 20 years of introduction in Mexico's construction industry has tried to implement different philosophies in order to standardize their processes .  If we look at history we could find two major events: the certification of ISO-9000 type and the philosophy of "total quality in construction."

In the early 90 `s in Mexico everyone spoke of the ISO. There were many certifiers and companies invested substantial financial and human resources in order to achieve certification. Construction in Mexico was not an exception. While it was thought that by means of defining processes, policies and specifications within the company people will adopt these changes, through a simple induction, reality faced a complicated situation. At least 80% of the workforce (permanent or temporary) in a structure of a construction company is cheap labor and low skilled. The rotation of staff is permament so there was no interest in the companies to  invest in training their workforce (as opposed to manufacturing) and this meant that the process could never be faithfully adopted. The result was an oversight of the certification years later. As of today it is difficult to find a major company that has an ISO type certification.

Later, by the late 90's, there was  the fashion of the overall quality of construction. More than a methodology, it was a philosophy of work that included extensive  rework by companies in their planning and design stages. If you spent time on this, it was said, the savings are considerable and the value added of the final product would make a difference. ¿Planning?, Many owners felt hives at this.

While philosophy was more readily applicable to the construction industry it involved a series of policy changes that aimed at standardization and professionalization of the company. The latter did not happen in Mexico. How could it be if the building is almost an art and a craft process?,-Said some  clueless managers out there. Now the consultants and similar species are trying to move the concepts of lean manufacturing into construction field. Now talk of "zero waste", "alignment of customer needs with the company", "generation of added value" is the new kind in town.

 It's funny but if you read any book of project management you´ll find that  these concepts are mentioned there. What's new with lean construction anyway ? - Nothing, it's just another fad in which several employers will fall to only realize after a few years that this philosophy it is exactly the same thing they had previously been trying to implement.

 It's the same dog but with a different name.

www.clarensyst.com.mx

Project Manager: the wrong idea.

About technology, business & management issues..

The concept of the Project Manager has varied greatly over the last twenty years in almost anywhere in the world. Originally it was thought that the project manager was responsible for the planning, execution, closure and implementation of a project.

Typically these projects were related to the fields of engineering in industrial areas such as construction and mechanical equipment. In recent times some other industries have systematized execution models as service companies or software developers have adopted the role of project manager in its operations. However in the last decade in Mexico, thanks in part to the professionalization of processes within companies, consultancy has idealized the idea of ​​the project manager in a somewhat romantic role but certainly not really aligned with the status quo mentality that prevails in many Mexican companies, particularly those engaged in industrial construction and property development.

- "The Project Manager should be in charge of the business unit," say pompously consultants and business leaders in Mexico. The idea is that the Project Manager is responsible for all areas of a project such as administration, sales and marketing. However, this domestic model enhances the whimsical minds of business owners but does not tackle the real problem.

Reasons? Lots ofthem: directing & supervising the operations of marketing, finance and management within a company involves a knowledge of the business that not all project managers (with a more technical background)  do not fully master. Moreover, the project manager works mentally for projects, from conception through implementation and ending with the closing. Being aware of other business areas involves constant attention and dedication that you are more likely to apply to a CEO role than someone who sees life through a series of projects.

On the other hand, perhaps the strongest reason passes for real empowerment in decision making. In theory, the project manager has the power to make financial decisions,  resolve operational and sales process issues, but in reality the micromanager that all owners have installed in themselves is constantly blocking  the PM do his work which undermines any attempt to develop as a business unit and turns the PM into a simple coordinator or  much-alike a personal assistant.

The funny thing is that the tendency to view the PM as the "cornerstone" of the business is still valid no matter how often they hit themselves against the wall.

www.clarensyst.com.mx

Risk & Commodities

About technology, business & management issues..

  During the last decade the commodities markets have experienced sharp fluctuations particularly strong price rise in oil prices, grains and some precious metals. This has led to farmers, industry, mining and petroleum related industries to suffer from year to year uncertainty.

The reasons are many: from long and protracted drought in the prairies of Russia and China, as the depletion of oil reserves in the Gulf of Mexico to the announcement by the U.S. government to support ethanol production based on corn.  So, how to establish mechanisms for producers, intermediaries and distributors to ensure a profit margin and create a foundation to grow their business?

Aristotle  mentioned  Thales of Milete as the inventor of the concept of futures contract by menas of an olive harvest in ancient Greece. Thales was  such an accurate predictor of how the conditions of the olive harvest would be months before it and this allowed him to establish price contracts with producers which in turn guaranteed in advance the price of it, avoiding both the vagaries of the market wreck at harvest.

But these financial vehicles not seem to have done to implement in many industries whether unions or organizations associated regulators have decided not to implement or have not been able to craft the right model for it.

There is a whole opportunity for the development of financial engineering vehicles to establish conditions for protection against the risk of volatility commodity prices.

The question remains whether there will be no other interests,  which are clearly  blocking the establishment of such vehicles.

www.clarensyst.com.mx

The eternal micro manager.

About technology, business & management issues..

   It was over a restructuring process within the company in which  I had collaborated for eight years when I realized it.  Senior Management had hired a consultant who worked out a pretty decent proposal and rationale for the size of the company at that time. "We are building the foundations of the enterprise for the next 20 years," said one of the managing partners.

The idea seemed perfect: professionalising the business, find performance metrics of the contributors to avoid subjectivity and to define roles and processes within the company. Create a structure in order to create a career path within the company itself (¿naive?).

But the owners could not get rid of the micro manager buried deep inside of them. That little devil in all of us that constantly tells you that you do not  need to delegate anything to your subordinates (nobody can do  it better than you !) that you need to check them out all the information generated or passing through them (why trust them?) and that planning meetings are merely a constant exercise of accountability that only strained relations between owners and delegates.

How to avoid the cancer that exists in virtually all businesses in the world? I think it is impossible to eradicate it: every business owner feels like he is the next incarnation of Steve Jobs so their bad manners and contempt and capricious treatment are fully justified.

Perhaps an effective tactic, as mentioned by the founders of 37 signals in his book REWORK,  is to avoid the maximum weekly meetings. As Jason Fried mentioned it, they have no particular target, people do not come prepared, are ambiguous in their objectives and always, always a fool wants to get the attention in the meeting and he thinks he has to share his wisdom with all.

www.clarensyst.com.mx

Agile business.

About technology, business & management issues..

It's been 11 years since Martin Fowler and 17 other programmers released a manifesto called Agile Software Development. The manifesto,  a highly praised ideological tool for people in the field of technology was a simple document which sets out some principles of a methodology to develop software more quickly and objectively.

Since that time the term and concepts have been applied to various aspects of enterprise development, particularly in start ups. Arguably, the lean start-up is a unique version adapted from the principles of ASD but with their particular characteristics.

The ASD emphasizes software development and the creation of a methodology that contrasts with the waterfall model which implies the full development stage of software before its testing phase has started.

If we make the extrapolation of these concepts to the idea of starting a business or a personal project, this is a valuable tool since it allows the flexibility to make changes to the business model necessary to ground the idea in a practical and concise way, without dogmas of faith or prejudices who die hard.

Figures determine the premises, but once put them on paper, developing and implementing action processes should be a dynamic exercise and constantly changing to adjust as needed. This would be like a properly calibrated weighing scale industry or  a simple called action to just tune into your  favorite radio station.

Test, tweak, edit and start over. It should not be so complicated.


www.clarensyst.com.mx

The business model: theory and reality.

About technology, business & management issues..

About ten years ago arguing with a former employer, a group of young people in their twenties ,who were part of the management team that run the projects where the company was involve, were not really keen on his claim. Those meetings stressed out the fact that the business model of general corporate and the one of  individual projects must be realistic and that these changes should be communicated to those affected. - "The projects are just perfectly in theory, in real life the dynamic is different, "- he said frequently.

The memory came to mind after talking to several people who are frequently faced with the grim reality of the business or a single investment project that has not been undertaken as they had planned in their minds. The reality was very different from the theory.

The reasons are many and countless: the entry of an unexpected competitor (in business with few barriers to entry), lack of funding (no more personal & family savings), volatility in prices (for projects that invest in commodities ) excess in sales and marketing  budget(if  you want to get into horizontal markets) and to the impossibility of finding a profitable business model in the short and medium term (tech-related companies).

The funny thing is that people get scared as if this were not the common denominator of any venture that has been started, as if fate had taken a fancy to make them fail.
The reality is that when this happens the easiest thing to do is understand the dynamics of business and make the proper adjustments to pull it off. This is especially important in technology companies that handle many dogmas as excess investment (usually raised capital) or reaching profitability in the long term.

Many of the lean startup philosophy applies in these situations. Applying common sense, if decisions are quick and assertive, if you remove the dogmas of the mind then you can adjust on the run the business model and surprisingly fix what was supposed to be broken.

www.clarensyst.com.mx

every.cloud

About technology, business & management issues..

It's funny how ideas arise in the minds of people. While spending hours in front of my computer in a room of 5 x 5 meters in a cold room of a university town in Wales ideas seemed to come from nowhere. Maybe it was the cold wind from the North Sea, perhaps it was loneliness that allowed the ideas flowing.

How to harness the trend of "cloud computing" in the context of SMEs in a developing economy like Mexico? How to make it accessible, easy to use and that met the Mexican reality? Under these assumptions the idea of ​​every.cloud was born.

The idea was to create a platform where SMEs could create their own collaborative ecosystem. The goal was for companies to use the Internet to communicate, generate information, reports, data exchange, creating value in the sales process. How to create something simple and useful, without pretensions or ambitions beyond delivering excellent customer service ?

Many questions and no answers at all. What target market? How to communicate the idea? What is the real possibility of adoption by SMEs? Does the service must be paid or a free one?

    After months of thinking about it, chewing it,  rejecting it, adjusting it, discussing  it and finally achieve it in a couple of real products that originated every.cloud as a web platform.

Coming soon it  will be available through the web and then we can verify that it complies fully with the purpose for which it was created: to provide a web tool to micro, small and medium enterprises in Mexico.