Organising for Concurrent Engineering:
The Theory and Practice of Managing the Supply Chain through Clusters
Corresponding Author: Nicolini, Davide
Author(s): Nicolini, D. (*), Holti, R. (*), and Smalley, M. (+)
Organisation(s): (*) The Tavistock Institute, London (UK), (+) Warwick Manufacturing Centre (UK)
Work clusters are used as an organisational approach to supply chain integration and application of concurrent engineering principles in two demonstration projects carried out in the UK. The projects are part of a three year R&D initiative sponsored by the Government in 1997, aimed at developing and testing the working principles of an innovative approach to construction procurement based on supply management and integration. The two demonstration projects involve the construction of two training and recreational facilities and are at an advanced design stage (November 1998); on-site activities are scheduled to start at the beginning of 1999 to be concluded within about 50 weeks.

Clusters were devised as the most appropriate organisational design to foster collaboration at project level and to promote concurrent engineering and lean construction practices. The clustering design was based on the principle that collaboration between members of a supply chain is most likely to bring cost and value benefits when it takes place within work-packages (“Clusters”) defined in such a way that complex co-ordination of design and construction decisions and actions can be controlled directly by a limited number of people, working in close contact with one another.

In this paper we will introduce and discuss in some detail the organisational design principles used to set up clusters at project level. We will then describe how the clustering approach was developed in the two pilot projects, as well as the impact of the clustering arrangement on the re-engineering of the design and construction process. In particular, we will discuss how clusters supported efforts to improve value, eliminate waste and inefficiencies, and reduce costs in the project. Evidence on the
 difficulties, barriers and costs associated with the implementation of the clustering approach will also be presented and discussed. The paper will conclude with some reflections on the use of clusters and on issues for future research.