Tag: Katerra

OM in the News: Construction Sites That Look Like Lego Kits

Katerra staffers and robots build prefab wall panels on an assembly line

On the floor at Katerra’s cavernous 250,000-square-foot Phoenix factory, workers and robots hammer pallets of Douglas fir into finished wall panels and put them on an assembly line, where other machines and craftspeople add windows and plumbing before a crane stacks the finished walls on a flatbed. When the truck arrives in Lodi, Calif., 3 days later, a construction materials manager uses an RFID scanner to see what’s arrived and an iPad to show where cranes should set each piece of a 4-story retirement home.

This process is a radical change for the construction industry and a threat to decades of this-is-just-how-we-do-it attitudes. While other construction tech startups try to modernize some parts of the business, designing modular homes or building robot-run factories to make prefab parts, Katerra puts all these pieces together, from design to finished building. The company wants to control everything from “womb to tomb,” says one customer. “Almost everywhere you look, there’s money to be saved,” says Katerra’s CEO. “It’s so inefficient in so many ways, it kind of takes your breath away.”

Katerra saves money by buying everything from wood to toilets in bulk and using software and sensors to closely track materials, factory output, and construction speed. Its architects use software to build a catalog of standard buildings, rather than starting from scratch on each project, and to ensure contractors aren’t making impulsive structural decisions. Each generation of buildings has become steadily more prefab, requiring less work on-site and speeding construction.

The idea of modular housing goes back more than a century—Sears, Roebuck & Co. sold more than 70,000 home kits from 1908 to 1940—but the construction business has been changed far less by technology than any other major U.S. industry, writes Businessweek (June 25, 2018).

Classroom discussion questions:

  1. What the OM advantages of Katerra’s approach?
  2. The disadvantages?

OM in the News: Why Can’t Houses Be Built Like iPhones?

Katerra manufactures whole walls—including windows, insulation, wiring and plumbing—in its factory

The world’s housing crisis has many causes, but there is a stubbornly persistent one that we should have been able to solve by now: Productivity. As prices of components and materials for pretty much every other physical object—cars, cellphones, clothing—have dropped precipitously, it still costs too much to build a building. “Over the past 60 years, productivity in manufacturing has increased 8-fold while remaining basically flat in construction,” writes The Wall Street Journal (July 3, 2017).

Some companies think they have a solution. They are reviving old ideas in construction, including prefabrication and modular building. And they’re applying all the logistics and IT knowledge gained from building the global supply chains that deliver mobile devices, and all the automation pioneered by the automobile and other manufacturing industries.

Take Katerra. It has a 200,000-sq-ft factory in Phoenix where it manufactures whole walls, including all the windows, insulation, electrical wiring and plumbing. Katerra uses an integrated CAD/CAM system that tells all the factory’s automated saws and routers how to produce all the buildings’ components. The same system connects to job-site cranes that lift and place the finished panels. Katerra ships the walls to construction sites, where they’re snapped together like Lego bricks. The company’s goal is to build 7 more factories in 2 years, each intended to serve a different geographic area.

Katerra is responsible for its buildings from design to final construction, which allows it to further cut costs. In consumer electronics, “design for manufacturability”—the reconfiguring of a device’s shape and function to make it cheaper to build—is standard. Another thing Katerra borrows from that industry: buying goods in bulk, direct from suppliers.

Classroom discussion questions:
1. What is design for manufacturability? Give an example.

2. Of what type of layout is this an example (see Ch. 9)?