In pursuit of operational excellence: the turnaround that boosted Andrade Gutierrez

Lean culture delivering results

Andrade Gutierrez (AG), which has always been recognized as an innovative company with cutting-edge engineering, has seen steep growth in its operations, something very positive but, at the same time, challenging. Taking the knowledge structure to new areas of the business and to the sites involved in the expansion is not a simple task. Considering the new markets, the organization needs to acculturate the new fronts, bringing them into its lean transformation journey in pursuit of excellence. Fortunately, the company now has a structure to deal with this growth and to multiply lean throughout the organization, including in new areas of the business.

Andrade Gutierrez Engenharia's journey toward operational excellence began in 2010 at the Arena da Amazônia project, when the project's leaders realized the need to improve some specific processes to achieve better performance. With the help of an external consultancy, they set out to reduce waste with an approach geared toward achieving the desired results on the project.

What the company has achieved in just over ten years, however, goes much further, and the development of internal competencies was an important milestone in this process. Today, the company can be considered a lean company, with lean culture and routines built into the way it works. Through this cultural transformation, Andrade Gutierrez has achieved several significant results on its journey, such as the following:

• Just one year after lean began to be expanded to all projects, average productivity gains of 20% were observed, along with shorter schedules, higher quality and cost reductions, which drove the company to keep up its continuous improvement efforts.


• Through the Value Capture Plan methodology, the company is able to establish that millions of reais have been saved over the years thanks to the consistent application of lean thinking.


• Motivation, quality of life and satisfaction of the organization's people were found to be better after the lean efforts.


• The management methods implemented show continued improvement and evolution in processes, while the levels achieved are stabilized.

AG is among the companies that show success stories on their journey toward operational excellence because they did not focus only on lean tools. The organization understood the importance of evolving its culture, embracing lean thinking and bringing lean inside. Not just “doing” lean, but “being” lean.

 

The importance of lean

All this cultural change has made lean something natural in the company, intrinsically rooted and respected in the organization. The fruits of lean are visible as the foundations of innovation in the company, and the company's continuous investment only strengthens this notion.

Lean's contribution became even more evident during the Covid-19 pandemic: despite the difficulties all companies are facing, AG's operational results were maintained thanks to the culture rooted in the organization. This allowed the company to keep seeking process improvements even in times of crisis, since thinking lean made it easier for it to become more flexible and adaptable to the uncertain current moment.

With more than ten years applying lean construction, the company can now say with pride that its advances are the fruit of its team's discipline and efforts, and not just of external consultancies. Of course, the help of external sources of knowledge on what we have not mastered always remains important. However, many of AG's achievements are recognized within the organization as its own, and they probably would not have been possible if the company had not taken ownership of the knowledge.

 

How it all happened

After the success in 2010 on the company's first project to apply lean construction, other projects began receiving implementations, with equally significant results. In these initial contacts, AG received specific training aimed at the fronts of the project in question, preparing the people involved to apply lean tools specifically on the ongoing project.

Over time, the company felt the need to bring the philosophy inside, to take ownership of the content, because it knew it would use it on many different projects.

By then, there was already a perception that lean needed to go beyond localized applications, which brought immediate results but were sometimes lost at the end of a project. This was because the good practices applied were not incorporated into the company's routines, and almost everything started again from scratch when a team was transferred to new projects.

To consolidate lean, it is necessary to develop competencies and create a structure for multiplying the mindset. To consolidate lean, it is necessary to develop competencies and create a structure for multiplying the mindset.

It became clear that for lean to take hold in all of the company's activities, it would be necessary to develop competencies and create a permanent internal multiplication structure.

Thus, with trained people, the rollout to other projects and areas of the company would become easier and faster, with the creation of a strong team dedicated exclusively to this topic, so that the company itself would be the engine for multiplying knowledge and practice.

With this in mind, in 2014 AG sought the help of Lean Institute Brasil (LIB) to develop the core group of people who would launch the permanent lean dissemination structure, building internal critical mass and creating independence and autonomy in its applications.

 

Training the first group of multipliers

Meeting this demand, and based on its experience implementing lean in construction companies and in various other sectors, LIB designed a ten-month program, based on learning and application cycles, that followed some fundamental principles:

• Lean can only be learned by doing and delivering results. Therefore, in addition to training, each multiplier in development had the goal of a real lean application on an ongoing project, with a commitment to a minimum return.


• Learning cycles. The program was designed as four training modules, one week each, interspersed with three application projects on site, three months each. The projects were of gradually greater complexity, from specific improvements in one activity to more systemic actions impacting the whole project.


• Training in the gemba. The training modules were practical, applying lean tools in the field and preparing the multipliers for the activities they would carry out on their projects next.


• Broad mastery of lean concepts and tools. The training was very thorough, starting from the origins of lean and its purpose, basic concepts from manufacturing and their application in construction. Topics covered included A3 thinking and problem solving, flow planning and takt time, Last Planner System, visual management, value stream mapping, waste analysis, basic stability, standardized work, pull system, supply logistics, kaizen, lean in engineering, the production preparation process (3P), lean leadership and strategy, among others.


• Applications beyond production. The implementations were not limited to operational site processes. Concepts such as lean office were applied to project administration processes, with huge results in reducing indirect costs. Support functions such as engineering, procurement, logistics and maintenance were also addressed.


• Connection with business needs. The application projects were selected with the projects' contract directors, targeting their specific objectives, needs and priorities to maximize the impact on results. Methods for capturing the benefits generated were put in place.


• Developing the multiplier role. In addition to technical competencies, behavioral competencies were also developed, so that they could act as influencers and advisors to the project teams.


• Support through coaching. Each multiplier in training had the support of a LIB sensei, who accompanied and guided them during the development of the projects on site.


• Continuous assessment and feedback. A continuous assessment process was established, with the mentor assessing technical and behavioral aspects and the evolution of results at each visit, with feedback and learning assessments at each module.

The practical applications took place on major projects under way at the time, in six Brazilian states and in Latin America, covering various types of projects such as mining, sanitation, energy, a sports stadium, highway, railway, subway and urban roads.

The approach used brought huge results in these applications, such as 30 to 50% productivity increases in the activities addressed, project schedules reduced by months, and financial gains of millions of reais recorded on each of the nine projects addressed, in addition to organizational gains such as the implementation of management routines that led to the stability and maintenance of these results and the training of eleven specialists certified as AG Lean Consultants, who became the core for maintaining and expanding lean throughout the company.

Also worth highlighting as a result is the fact that, building on this initial practical and conceptual foundation, these internal consultants continued to expand their knowledge and became a key factor in spreading the lean culture in the company.

 

Maintenance and expansion

Since that initial training, a lot has continued to happen and evolve. The operational excellence area was structured, and the multipliers initially trained took over internal dissemination. Using the program developed by LIB as a basis, new classes training corporate and site multipliers were held, entirely with internal resources.

Over these years, and through a recruitment process with clear selection criteria, four generations of consultants have been trained, always with the original consultants acting as mentors to the new ones and keeping the spirit of practical application connected to business needs. Improvements were incorporated, such as including more AG examples, greater emphasis on soft skills and supplementing technical topics when necessary, with the help of LIB.

Regardless of the moment, lean has always been kept as a priority in the company. Today no project starts without applying lean concepts from the planning stage, and lean covers all areas of the company: operational, corporate and business. Lean approaches, with their productivity and schedule gains, are applied from the preparation of proposals onward, enabling greater competitiveness,  which has contributed to winning new projects in recent years.

Lean has been explicitly incorporated into the company's culture and strategy, driven by leadership. Several initiatives have been incorporated into the operational excellence effort, with great synergy, such as the systematization of SAGE – AG Excellence System, the creation of an innovation management unit, the Vetor AG Open Innovation Program, the BIM implementation project, among others.

A broader understanding of lean's potential and the development of internal competencies were an important success factor in sustaining the significant results achieved so far. This was undoubtedly one of the pillars of the competitive turnaround experienced by the company and is a driver of continuity and evolution.