Operational excellence through partnering with subcontractors in ground engineering industry

Sammanfattning: Construction in Sweden has got a low productivity compared to other manufacturing industries. The construction industry is deeply fragmented and consists of many small companies. The large construction companies are largely dependent on subcontractors. This paper aims to provide answers to how a larger construction company can handle subcontractors in order to achieve higher productivity. The study is carried out in collaboration with JM Entreprenad AB who are involved in ground engineering and foundation work. The study is divided into two questions are to be answered. 1. What effect can be accomplished trough longer supplier relations with subcontractors? 2. Is there any correlation between the number of suppliers and a projects outcome? The choice of method to answer the first question is a extensive literature study, questionnaire survey, interviews and site visits. The second question is answered though an empirical study based on book documentation of inputs and expenses from projects carried out. Collaborating more closely with selected subcontractors receives support in literature and is in line with accepted production principles and is beneficial for increasing productivity. Areas that would primarily benefit from closer work with subcontractors: • Standardization work. • Eliminate waste and avoid sub-optimization. • Quality control and repeatability. • Counteract ’hostile contracting’ and opportunistic thinking. • Improve experience feedback. It is not possible, in this study, to give a clear answer based on literature findings that the construction industry would benefit from closer cooperation and a defined number of subcontractors. One reason may be the lack of data from projects defined by far-reaching collaborations. There is in this setup no correlation between the number of subcontractors and a project’s wine margin. However, this may depend on how the empirical study was conducted och analyzed.