Investigating the relationship between planning reliability and project performance

Abstract

Variability is a well-known problem in construction projects, which leads to the general deterioration of project performance. During the last decade, the Last Planner System (LPS), a production planning and control system based on lean production principles, has been increasingly applied in the construction industry to improve planning reliability reducing the negative impacts of variability. LPS promotes actions to increase planning reliability, monitoring the percentage of plan completed (PPC) in a short-term period. However, there is limited research evidence about the relationship between planning reliability and project performance. In this paper, the authors report on a detailed research analysing this relationship during the construction phase of a home building project at activity and project levels. By doing so, two indexes are proposed: an activity planning reliability index called the process reliability index (PRI), and a project aggregate labour productivity index, called the project productivity index (PPI). Statistical analyses using the proposed indexes were conducted showing positive and strong relationships between planning reliability and performance at activity and project levels. Finally, the research findings provide the guidelines of a preliminary methodology to forecast the impacts of planning reliability over project performance, when lean production methodologies are applied in project planning and control.