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An SMB Contractor’s Guide to the Last Planner System

The CrewCost Team
Published Jan 10, 2024

“The first casualty of war is the plan.”

Much like the military, the construction industry embraces this common phrase that holds true on every project. No matter how well thought-out and detailed the plan is, as soon as it is executed, unforeseen variables present themselves and the original plan quickly becomes ineffective, getting sidelined by the new reality that takes over when things change.

If there is any sector of construction susceptible to this concept, it’s the SMB market. In a small contracting business, things are changing all of the time, sometimes on an hour-by-hour basis. It can be hard to manage one project, let alone multiple projects concurrently. One strategy gaining traction amongst SMB contractors is the Last Planner System (LPS). Typically associated with larger construction firms, LPS’s principles can significantly benefit SMB contractors. I am going to explore the LPS, its applicability for SMB contractors, and lay out a step-by-step approach to integrate it into your construction processes.

Key Takeaways

  • The Last Planner System (LPS) is a collaborative project management approach that involves frontline managers (the “last planners”) in detailed short-term planning and commitment to weekly tasks.
  • LPS principles like pull planning, weekly work planning meetings, and learning from variance can benefit SMB contractors by improving collaboration, efficiency, resource management, and client satisfaction.
  • SMB contractors can start small with steps like training, pull planning, establishing communication channels, holding weekly meetings, monitoring progress, and gathering feedback.

What is the Last Planner System?

The Last Planner System is a collaborative project management approach focusing on workflow reliability and efficiency. Originating in the lean construction movement, LPS shifts the planning process from a top-down to a more collaborative, bottom-up approach involving all stakeholders, including subcontractors and suppliers.

Who are the last planners, you may ask? The last planners are the frontline managers directly overseeing the work. It could be a project manager, a superintendent, a field engineer, a foreman, or a crew lead, depending on the nature of the work. The last planners are the ones that have the most intimate knowledge of the immediate situation on the ground, in real time, of what is happening in relation to their scope of work on the construction project.

At its core, LPS is about ensuring that project plans are realistic and achievable. It emphasizes continuous planning, where tasks are planned in greater detail as they get closer to execution. This is in contrast to a scheduler, an office-based project manager, or project executive planning the work. Often, these individuals are removed from the daily happenings on the project and do not possess the same level of detailed knowledge around not only their respective scope of work, but the other concurrent scopes and how they all interact. The LPS approach helps in identifying potential issues early, ensuring better resource utilization, and aligning every team member’s efforts towards common project goals.

What Can an SMB Contractor Use from the Last Planner System?

LPS’s principles are not exclusive to large-scale projects. Ironically, in a less organized fashion, you may be using many LPS techniques and not even know it. SMB contractors can use these practices to enhance project coordination, reduce waste, and improve delivery times. Key aspects of the LPS include:

  • Pull Planning – This involves planning the project backwards from a specific milestone or project end date, ensuring each task is necessary and efficiently sequenced. Sometimes referred to as backwards planning, this approach gets the key individuals of all relevant scopes together in one room and has them debate and discuss what order elements from each of their respective scopes needs to happen in order to achieve the milestone. Usually this happens in a large conference room with different colored sticky notes on a wall or dry erase board to plan the activity.
  • Weekly Work Planning – These sessions focus on short-term lookahead planning, with team members committing to weekly tasks, which enhances accountability and reliability. These weekly (or daily) coordination meetings can be used in conjunction with the 3-week lookahead schedule, which provides a blueprint for how the work will flow that week; any changes or alterations to the lookahead schedule can be discussed amongst the relevant parties and the plan can be modified accordingly.
  • Learning from Variance – Regularly reviewing what was planned versus what was achieved, learning from discrepancies to improve future planning. Again, this is an activity that is usually performed in conjunction with the 3-week lookahead schedule, as that is more of a “living document” that memorializes changes based on real time conditions in the field.

Benefits of Using the Last Planner System Methodology

The benefits of using the Last Planner System are massive and can directly influence the course of the project and, ultimately, its financial success. For SMB contractors, implementing LPS can lead to:

  • Enhanced Collaboration – Involving the whole team in planning leads to shared understanding and commitment. Each trade can be involved in planning that week’s work and know what the other trades will be doing and where they will be working, leading to a more streamlined workflow.
  • Increased Efficiency – By identifying and removing workflow bottlenecks, the work gets completed faster and with less mistakes. The subcontractors are going to experience less frustration and will be able to work in sync for a more productive jobsite overall.
  • Better Resource Management – Optimizing the use of labor, materials, and equipment.
  • Improved Client Satisfaction – The LPS is a tried-and-true method to deliver better quality work, faster, to your client. Beyond improved client satisfaction with a faster completion date, you will be able to field client questions relating to all aspects of the project more effectively, having been privy to the detailed communications with each trade regarding what they need to accomplish the work.

Example of Last Planner System

Consider a residential building project. Using LPS, an SMB contractor could involve all subcontractors in the pull planning session, creating a shared project schedule. Weekly planning meetings ensure that everyone on the project team is aware of their responsibilities, and regular variance reviews help in adjusting plans proactively.

The plumbers can communicate that they had a delay in receiving certain materials and communicate that to the drywallers, so that they know not to install drywall in a certain section of the house where those plumbing materials still need to be installed, reducing coordination issues and rework.

This can also be communicated to the painters, who can plan on maybe pushing out their start date in that section of the house a little as well, to accommodate the delayed drywall installation. It is these small communications and decisions that might seem insignificant on surface level, but overall can be massive headaches if they don’t occur, and can lead to constant rework that affects your bottom line.

How to Implement the Last Planner System

Integrating LPS is simple on a project of any size. By following these steps, you can up your game and get your workforce using the Last Planner System like pros:

  • Training and Education – Educate your team on LPS principles and its benefits. You don’t necessarily need to have formalized training sessions with your team, but something as simple as setting up coordination meetings between all the trades working on the project and guiding the discussion initially can have a massive impact.
  • Pull Planning Session – Start with a collaborative session to create the project roadmap. Getting the trades involved early and often, backwards planning form a desired outcome, and determining the correct sequence of steps to get there, from each party, makes accomplishing the milestones of your project that much more feasible.
  • Establish Clear Communication Channels – Ensure all team members can easily share information and updates. There are many construction management software platforms that facilitate this, but if those are outside of your budget for the project, something as simple as a group thread text message with all of the ‘Last Planners’ can be extremely beneficial and allow for that streamlined communication that you are looking for.
  • Weekly Work Planning Meetings – Conduct regular meetings to plan and commit to weekly tasks. Depending on the size of the project, these meetings can occur on a weekly, or sometimes daily, basis. Understanding your project and knowing the level of communication and coordination that is needed is key to making sure you have these meetings as frequently as needed to be successful.
  • Monitor and Adjust – Regularly review planned vs. completed tasks, learn from variances, and adjust plans as needed. LPS is absolutely an iterative system, and if you run into an issue during one weekly meeting, it is easy to plan a mitigation strategy and implement it moving forward, so that you are learning from your mistakes.
  • Feedback Loop – Create a system for continuous feedback from all team members so your process is constantly being refined. This speaks to the Kaizen theory, or “process for continual improvement”. If the ‘Last Planners’ have the ability to continually iterate upon and improve the process, you will quickly learn which ways do not work and focus your efforts on the ways that produce results.

Final Thoughts

Implementing the Last Planner System can seem daunting for SMB contractors used to traditional project management methods. However, the shift towards a more collaborative, flexible, and efficient approach can yield substantial benefits in project delivery and client satisfaction. By starting small, perhaps with a single project, and gradually expanding the use of LPS principles, SMB contractors can significantly enhance their project management capabilities.

Adopting the Last Planner System is a strategic move for SMB contractors aiming to streamline their construction processes. While initially developed for larger projects, its principles are equally beneficial for smaller operations, fostering a culture of collaboration, continuous improvement, and operational efficiency. The key is to adapt these principles to your specific project circumstances and organizational culture, leveraging LPS as a tool for achieving construction excellence.

Further Reading: How to Create Construction Schedules That Build Profitable Projects

The CrewCost Team

The CrewCost Team consists of men and women who have worked in the construction industry as project managers, general contractors, sub contractors and more. They share their decades of experience on our blog as a way to help other contractors grow healthier and more profitable businesses.

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