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Welcome everybody out to podcast number 1325. In this podcast, I'm going to continue the why cake section, where we're talking about why you actually need the first planner system in pre-construction. So stay with us.

This is the Elevate Construction Podcast, delivering remarkable content for workers, leaders, and companies in construction wanting to take their next step. Get ready to step out of your comfort zone with Jason Schroeder, as he encourages you to do better, live a remarkable life, and expect more. Let's go.

Okay, everybody, I'm going to dive right in. Let's go. Every project has problems, whether we want them or not, and planning will allow us to prevent them to a great extent.

A concept that I love from how big things get done is to neutralize or eliminate what's called the window of doom. Let's say your project has a certain amount of problems. If you don't plan, you will find these problems in the field, and it will cost you time, money, and morale.

This leaves the window of the project duration open longer than needed, leaving more opportunities for uncertainties, one-offs, and black swans or severe risks to occur. So what happens when you find problems in the field? If you have wishful thinking in pre-con so that you find all of your problems in the field, you will have expensive overruns and the window of doom. This is the period of time when money flies out the window and the project keeps dragging on.

I'm suggesting that you leverage the wisdom of the team and learn from the sad experiences of others. Find the problems in pre-construction, where the worst thing that can happen is that you have to re-plan and erase the whiteboard or reprint the PDFs. You can largely predict project failure in one form or another and mitigate the damage.

When you find the problems on paper before construction, sure, some will happen in the field, but for the most part, the worst thing that happens is you erase the whiteboard. People tend to think that they are the exception, but since you're here, I'm going to assume that you are humble enough to accept the data presented below taken from how big things get done. These numbers represent the data compiled from over 16,000 projects throughout the world.

Of 100% of the 16,000 representative projects, only 47.9% finished on budget, only 8.5% finished on budget on time, and only a half a percent finished on budget on time as planned. Over 50% of the projects do not meet their budgets. They average 65% over budget.

That's an astronomical amount of error made by the team. Over 90% of projects don't finish on time. They average 58 days behind schedule.

That represents a knowledge gap within the team. Projects don't go wrong. They start wrong.

They start without proper planning, systems, training, and experience. How Big Things Get Done calls out several commonly held beliefs that need to be eliminated from all construction, and I'd like to touch on them here. Please read the book if you're interested in digging deeper.

These fallacies are pervasive beliefs held by many leaders and owners. We have to call this out so that thought leaders and decision makers can see the harm these fallacies are doing to the industry and the people. The need for speed.

This concept is fine if you're a top gun, but rushing, pushing, and being in a hurry won't help projects win. It will cut planning and preparation which leads to a spiraling mess of rework, low-quality work prioritizing profits over people, and decrease safety on site. Generating speed in any way other than through creating flow is unsafe.

I don't like it because it's dangerous. Sorry to disappoint the Mavericks and the group. Pushing makes haste.

This fallacy pretends pushing people, pushing milestones too soon, and rushing work will make haste and help projects to progress and finish. The truth is that pushing creates pressure which leads to quick and erratic decision making, unclear, chaotic, or ineffective communication, team members losing focus on priorities, a decrease in creativity and problem solving, an increase in finger pointing and blame, declines in productivity as energy is wasted on managing panic, diminished trust within the team, a loss in morale and motivation, possible decrease in the quality of work, the team becoming more susceptible to making mistakes or overlooking critical details. The commitment fallacy.

The commitment fallacy is when owners, designers, or contractors think that getting a project started and a contractor on the hook will provide the motivation to make haste and complete it with urgency and efficiency. This is false. This actually only scales a mess.

If the contractor began without proper planning, it's likely they do not know what they are doing and they will be too busy catching up and recovering their interests to properly manage the project. Strategic misrepresentation. My favorite to hate is strategic misrepresentation.

This is when owners, designers, or contractors misrepresent existing conditions, complexity, or the full scope of a project effort in order to push risk on another party or get the other party to begin work and push through what would otherwise be a change in cost or time. It's a fallacy to believe that the end justifies the means. This is disgusting and inexcusable behavior.

All of these fallacies will hurt people. They'll hurt you. If you experience any of them, you can anticipate that they will prevent the kind of planning and stability needed to run a remarkable project.

Additionally, you can add these to the list of idiotic ideas. Why are workers not working in every zone? I want to see busyness throughout the building. You don't need more staff for change orders.

You should be able to cover the changes with your current staff. I know the design is not finished, but we should be fine. We just need to get started somewhere.

Just get it done as quickly as possible, no matter what. Cut corners wherever you can to save time and money. We're not concerned about quality, just meet the deadline.

Ignore safety regulations if it helps speed up the process. We won't pay for delays, so make sure everything stays on schedule. Don't worry about proper permits or approvals.

We'll bypass the bureaucracy. We expect you to work overtime without compensation to meet our timeline. If you can't deliver on time, we'll find someone else who can.

We don't need to review the plans thoroughly, just start building. We'll hold back payment until the project is completed, regardless of delays or issues. You're responsible for any cost overruns, so keep expenses low at all costs.

Don't bother with thorough inspections. We trust that everything will be fine. If you can't handle the pressure, we'll find someone who can.

And lastly, you just need to have your trades work overtime. If you hear any of these, you must hold the line, do what is right, and push back or you will and your team will suffer through a crash-landed project that will hurt you, your people, and your families. The ways a GC or trade can hold the line.

Communicate the need for flow in the work. Establish a clear schedule with needed predecessors. Continually ask for work to be made ready ahead of you.

When asked to push, refocus the conversation on preparing work. Do not do any work unless it is financially approved, the crew has the capacity, and it is clean, safe, and organized. Coaching from leaders creates pressure, which leads to panic.

I observed and tracked the outcomes of projects over a period of years in Arizona and found clear and frustrating results when comparing the execution of projects that push in comparison to a control group. And here's where I'm going to stop reading, and I'm just going to explain it to you. On one of the images I show, the aggressive plan with CPM, which we found was always 20% less than what was needed.

And then reality would always be anywhere from 5% to 15%, sometimes 20% and more. And the project would literally be across landing, hurting the trades, pushing it over budget, and obviously extending the time. And the problem was when we did more research is that it was pushing.

When the team clearly knew they didn't have enough time, they would push, push, push, push, and then they would start to do stupid things, which counteract production, which is basically adding more people above needed levels, working overtime, bringing out too many materials. Like I said, rushing, pushing, and panicking, throwing money at the problem, right? But when we studied tack planning, where you had a good amount of time and you weren't worried about the pushing fallacies, but we found out that when you planned a project, even with buffers, you would finish 1 to 5% early. And that was pretty consistent.

So we're totally underselling the tack production system when we go through this book, because literally what we found is that when you use CPM and push, you're 20% under, 50% over. When you're using tack planning, you're spot on and then minus 1 to 5% under, which means that you're financially whole and no one gets hurt. Now, let me continue.

I want to explain a concept. Sometimes people think that when we're talking about lean, that we're going to go try stuff and iterate fast and do continuous improvement. Well, when you're out in the field, that's the wrong time to be doing that from a fundamental standpoint.

You plan and iterate, plan and iterate, plan and iterate when it's on paper. And that means we have to go prove these things and prove these designs and make sure that we have the right deal early on in order for us to win. And here, let me go ahead and read something.

In the book, How Big Things Get Done, they talk about Pixar. No Hollywood movie studio is as successful as Pixar, and it is their exhaustive planning that ensures each movie has created a hit. A writer will take one interesting thought and use multiple rounds of peer reviews to build that thought into a story outline of about 12 pages.

Then the story outline is approved, a rough draft is written, and then presented to a peer audience of Pixar employees. The draft is critiqued in a feedback session and the process begins again. The only requirement is that the draft must improve.

Several rounds of draft feedback and improvement take place. Once the writer has a fairly decent script, the movie is made into a storyboard form. This is about 2,700 drawings compiled into a movie with basic sound effects and voiced by Pixar employees.

The movie is shown to a new audience with Pixar and the movie is picked apart. To this point, the process has taken about four months and is a considerable investment, but the investment is minor compared to the cost of actual production. The storyboard movie is remade and critiqued, usually around eight times in all.

This extensive process allows people to be creative and imaginative without consequences. Every part of the plan is subjected to intense scrutiny and experimentation. The pressure to get things perfect the first time is removed by understanding that others will challenge the plan and help connect and correct the story.

The real production finally begins with true animation, professional voice actors, a score of sound effects pulled together for the final time. This is the film that is released by the studio generally, and I want everybody to hear me when I say this, generally the ninth iteration of the movie. So by the time you see a Pixar movie, it's the ninth time.

They say rework and planning is inexpensive compared to the cost of rework during production. Do your due diligence by planning extensively for the benefit of everyone who will have the privilege of being a part of your project. Pixar starts their planning with an interesting idea.

We start our planning with a conceptual design. Pixar begins production with a script and visual guides in place. We begin construction with a plan and visual guides as well.

There's no guesswork in a final Pixar production, and there's none in a fully planned project either. Architect Frank Gehry designed and built a 76-story skyscraper in Manhattan with no change orders because he doesn't let clients build before the design is complete. It's possible to complete planning before construction begins, and let me tell you what I expect before we do.

We need TAC plans and zone maps, procurement logs, logistics plans, trailer and signage designs, organization charts or accountability charts, risk and opportunity register, a well-established budget, and a master builder and experienced team before we begin. It is critical to have these components in place before construction begins, and it must be done with the help and buy-in of the first and last planners. I believe it is unethical to hold a project team accountable for a project they did not plan.

We need a maximum virtual product developed by the team that will build the project. Over 60% of project success is determined before NTP, so when that notice comes, you'll be ready to win with these in place. This is the why.

Preventing problems through planning is the reason this book exists and why we are spending our time trying to raise awareness. You can prevent most of the difficulty you have in construction by creating and maintaining a project production system for your project. Are you ready, set, on we go.

I hope you've enjoyed this podcast. Next podcast will go right into the first planner system, the production system. Let's go.

Please join us next time in elevating the entire construction experience for workers, leaders, and companies coast to coast. If you're enjoying the show, please feel free to share with your construction colleagues and help us spread the word by rating, subscribing, and leaving a review on your preferred podcast listening platform. We really appreciate it.

We'll catch you next time on the Elevate Construction Podcast.

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