Controls News 13
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Main theme: Lean automation |
Processes
«
Cheap in Mind» – the strongest force in
construction as a destructive optimum
Automation solutions for real estate are complex
and highly individual systems, subject to a constant
pressure to innovate. They cannot be described and
checked precisely in kg or mm. Yet automation is de-
scribed in tenders as a commodity for the futures ex-
change in Chicago. The cheapest wins the contract.
The conclusions to be drawn from this have been
described many times in the past. For example,
John Ruskin, the English writer and social reformer
(1819–1900),
wrote:
There is hardly anything in the world that someone
cannot make a little worse and sell a little cheaper,
and the people who consider price alone are that
person's lawful prey.
It is unwise to pay too much, but it is also unwise to
pay too little. When you pay too much, you lose a
little money, that is all. When you pay too little, you
sometimes lose everything because the thing you
bought is incapable of doing the thing you bought it
to do. The common law of business balance prohib-
its paying a little and getting a lot.
If you deal with the lowest bidder it is well to add
something for the risk you run. And if you do that
you will have enough to pay for something better.
The words of John Ruskin are particularly relevant to
real estate projects. This is because of the high life
cycle costs in comparison to the purchase cost, and
because of the special distribution of responsibility.
A great number of different interested parties can
be involved in real estate projects. In addition to the
people shown in the picture, banks, investors and
«
project developers» can also be involved. It is typi-
Lean = maximum value and maximum efficiency
instead of a minimum purchase price.
With lean production, employees are a key element in generating value, not a mere cost
factor. The primary aim is to use available resources to create maximum value and
quality. The same is true of lean automation. This means turning away from traditional
behaviours and being ready to recognize and question today’s reality.
Author: Jürgen Lauber
Ignorance of the process and faulty thinking in automation
projects. Everyone knows it, but ...
Complex automation
solutions for real estate are
treated as commodities at
the tender stage (like pig
carcasses, wheat or copper)
in the futures exchanges of
this world.
John Ruskin1819–1900
Social scientist; described
vividly the economic non-
sense of «Cheap in Mind»,
especially for complex goods
and services.
Constellation of errors:
Negative consequences:
victims of «cheap planning» and «lowest bidder»
cal of such processes that operators are involved far
too late or not at all. Often the operators are not even
known at the planning stage. And it’s also typical for
planners to slink off as soon as handover is complete,
as each additional hour reduces the profitability of
their mandate. Many planners must also win their en-
gineering contracts through «lowest bidder» tactics.
Anyone who does more than the bare minimum is
soon ruined financially.
The powerful buyer who awards everything to the
lowest bidder is only responsible for the investment
sum until the time of the handover. Once his ac-
counts are done, he disappears from the «life» of the
new object. In construction automation the buyer
does the same as for simple standard construction:
he minimizes the investment sum. That is what he is
trained and primed to do. What is not considered is
the high leverage of control technology and automa-
tion, which influences operating costs, operational
quality and ongoing personnel costs.
Depending on the building, construction costs only
account for 12–15% of overall life cycle costs. Overall
control/automation technology accounts for 1–3%
of construction costs. The potential savings from the
«
lowest bidder» approach are also extremely small.
But the consequences and risk in terms of operation
is huge. The Americans have a saying for this: «Penny
wise and dollar stupid».
«
»
Owner
Planners/Arch.
Buyers/GC
Operators
Technicians
Plan Implement
Operate
Project
no longer involved
not involved
en135
