STREAMLINING STRATEGIC PROCUREMENT OPERATIONS IN REAL ESTATE DEVELOPMENT PROJECTS IN SAUDI ARABIA THROUGH LEAN PRINCIPLES

Volume-09 Issue 09, October-2025 ISSN: 2456-9348 Impact Factor: 8.232 International Journal of Engineering Technology Research & Management (IJETRM) https://ijetrm.com/ IJETRM (http://ijetrm.com/) [466] STREAMLINING STRATEGIC PROCUREMENT OPERATIONS IN REAL ESTATE DEVELOPMENT PROJECTS IN SAUDI ARABIA THROUGH LEAN PRINCIPLES Fawaz A. Damanhori Master Student, Faculty of Engineering, Industrial Engineering, King Abdulaziz University, Saudi Arabia Prof. Mohammed Balubaid Professor, Faculty of Engineering, Industrial Engineering, King Abdulaziz University, Saudi Arabia ABSTRACT This study examines how Value Stream Mapping (VSM) and Kaizen, two Lean concepts, can fix the problems that big Saudi real estate projects have with inefficient buying. A mixed-methods approach that was used at the same time combined semi-structured interviews with a structured poll of 30 professionals in the field. Systemic delays were found to be caused by multiple review levels, late design changes, broken communication between departments, and processes that require a lot of paperwork. Individuals consistently thought that Lean had a positive effect on key outcomes like compliance, cost-estimation accuracy, stakeholder satisfaction, and cycletime reduction. There was strong internal consistency across performance indicators (±=0.769), a large, statistically significant correlation between VSM adoption and compliance improvement (r=0.751, p<0.001), and a strong predictive link between Kaizen frequency and cycle-time reduction (R²=0.856, p<0.001). ANOVA showed that developers get more out of their jobs than freelancers, subcontractors, and advisors. This is because they have better leadership support and digital infrastructure. Overall, VSM makes processes more open and better managed, while Kaizen makes ongoing growth a habit. Some of the things that should be done are requiring VSM to be used during purchase planning, holding cross-functional Kaizen meetings every three months to focus on approval bottlenecks and change-order loops, incorporating Lean into SOPs and KPIs, and improving ERP systems with automated processes and reports. Keywords: Procurement, Lean Principles, Value Stream Mapping (VSM), Kaizen, Real Estate. INTRODUCTION The Kingdom of Saudi Arabia is experiencing a period of profound economic transformation, driven by the strategic objectives set by Saudi Vision 2030. A cornerstone of this national agenda is the diversification of the economy away from its historical reliance on oil, with the real estate and construction sectors identified as critical engines for growth and development. The construction industry is projected to maintain significant growth momentum through 2025 and beyond, driven by large-scale investments in giga-projects, infrastructure, and preparations for international events such as the Riyadh Expo 2030 and the FIFA World Cup 2034 (Narayan, 2025). The real estate industry has become a hub for both local and foreign investment as a result of its phenomenal growth, which has created enormous opportunities but also put tremendous strain on the structures already in place for project execution. The real estate sector (RES) in Saudi Arabia encounters project delays and excess expenditure frequently (Alajmi et al., 2022). These problems have been traced to the processes and framework for obtaining other resources. The wasteful and uneconomical procurement procedures originate from inadequate planning, poor contract management, change orders, low-bid contracts, and financing constraints (Alajmi & Memon, 2022; Alshihri et al., 2022). Further, the project managers in the RES practice unfair tendering, estimate costs poorly, and give incomplete specifications to the procurement officers (Alahmadi & Alghaseb, 2022). As a result, real estate projects become more costly, their completion dates are extended, and the profits expected by developers are reduced. The absence of strategic procurement frameworks reduces project value and undermines national goals, such as those outlined in Vision 2030. Volume-09 Issue 09, October-2025 ISSN: 2456-9348 Impact Factor: 8.232 International Journal of Engineering Technology Research & Management (IJETRM) https://ijetrm.com/ IJETRM (http://ijetrm.com/) [467] IMPORTANCE OF THE RESEARCH Procurement is mainly about finding the right balance between three key project constraints: cost, time, and quality. These factors, shown in the 'Procurement triangle' in Figure 1, all affect each other. If procurement does not manage one of them well, the others will be impacted. For instance, choosing the cheapest supplier might lower quality, which can lead to extra work, delays, and higher overall costs. Figure 1 Procurement Triangle The outcome of this study will be valuable to several stakeholders in real estate development. For instance, developers in the real estate sector will be equipped with knowledge and solutions on how to optimize their procurement processes. This refinement will reduce and eliminate unnecessary expenses. Furthermore, contractors will have the capability to manage and control their supply chains through a streamlined process incorporated with lean principles. Notably, scholars in the industry field can use the results to benchmark their practices within real estate development. Finally, decision makers in the Kingdom of Saudi Arabia can integrate the findings in assessing the accomplishment of Vision 2030’s construction goals. This way, they could either develop regulations or offer incentives to ensure the industry incorporates sustainable procurement. OBJECTIVES This project will evaluate how lean principles can make strategic procurement have a significant impact on real estate projects in Saudi Arabia and assess how these principles affect project results. This aim will be supported by three key objectives. RO1 - To explore and examine how procurement is currently managed in real estate development projects in Saudi Arabia. RO2 - To highlight the main difficulties and areas for improvements, Identifying major types of waste and value stream inefficiencies that occur in the procurement procedures and provide recommendations on how they can be eliminated through lean principles and approaches. RO3 - To assess how lean approaches can be applied to streamline the procurement approaches in the real estate sector in Saudi Arabia. LITERATURE REVIEW Othman and Kamal (2023) argued that the traditional procurement approaches in construction projects inhibit suppliers, contractors, and other stakeholders from implementing the project design. According to the authors, most construction projects tend to lack maintainability features during the process of design, and this leads to high operation costs and reduced building performance. In addition, the authors sought to evaluate the relevance of early involvement of suppliers in the process of design in enhancing building maintainability. The study used the literature review method, survey questionnaires, and case studies to achieve its objectives. Othman and Kamal (2023) found that early supplier involvement was limited by challenges associated with trusting external parties and a lack of transparency in information sharing. Volume-09 Issue 09, October-2025 ISSN: 2456-9348 Impact Factor: 8.232 International Journal of Engineering Technology Research & Management (IJETRM) https://ijetrm.com/ IJETRM (http://ijetrm.com/) [468] The study by Ebekozien et al. (2023) evaluated the challenges affecting procurement management and provided suggestions for improving policy measures for infrastructure development. The authors collected data using virtual interviews with construction and engineering consultants and case studies from secondary sources. Some of the challenges found in the study included lack of competition and transparency and lack of skills and knowledge Atkinson et al. (2023) observed the need for the construction industry to use an appropriate procurement method that enhances a collaborative working environment. The authors explored the various collaborative features of new models, the UK government introduced for construction procurement. Consequently, existing literature was used to evaluate the important features of the proposed procurement methods. The authors also obtained feedback from industry practitioners using a questionnaire survey. The study found that greater collaboration can be enhanced using features such as contractual incentives, effective communication procedures, and regular feedback. The aim of the study by Evans et al. (2022) was to develop a competency initiative that would help the contemporary construction industry to integrate the practices of lean construction and integrated project delivery. The study used mixed research methods, which involved literature review and empirical questionnaire surveys. Some of the significant key drivers to integrate lean construction practices include collaboration in design and construction works, support from senior organizational management, and boosting the implementation of lean construction and integration of project delivery. Maraqa et al. (2021) assessed and quantified the impacts of lean construction and the implementation of building information modeling on construction project flow. The study used the construction flow index to analyze control data from 18 high-rise residential projects of construction done between 2011 and 2022. Further, comparable projects were selected to compare the flow impacts of these innovations. The authors found that the implementation of lean construction practices led to an increase in CFI from 4.31 to 9.12. In addition, the integration of lean practices with building information modeling had more benefits than when they were implemented separately. Chavan et al. (2021) used mixed-method techniques in determining the factors that affected purchasing performance in engineering procurement and construction firms. The study by Chavan et al. (2021) evaluated the opinions of 32 experts across the industry with the support of academic literature. According to the authors, buyer-related factors, such as buyer knowledge factors, have been missing in prior purchasing performance. Therefore, the study suggests that buyer-related factors should be incorporated to ensure that purchasing performance is more optimized and less erroneous Tuffaha et al. (2021) developed a framework that would be used to assess the performance of construction contractors in Saudi Arabia. The authors were against the prior method that assessed contracts on the basis of financial aspects, ignoring the non-financial elements. The aim of the study was to develop a framework that would allow contractors to benchmark their performance against their peers in the construction industry in Saudi Arabia. This study by Tuffaha et al. (2021) used a literature review and feedback from contractors in the construction industry. The study found 5 KPIs as the most important through a component analysis method, and they included performance, actual metrics, compliance, satisfaction, and estimated metrics. METHODOLOGY This study evaluated how Value Stream Mapping (VSM) and Kaizen may improve Saudi Arabian real estate development project procurement. Lean methods were explored to eliminate procurement delays, cost overruns, and process fragmentation. The technique was designed to (1) investigate existing procurement methods, (2) identify inefficiencies and waste, and (3) evaluate Lean solutions to simplify procurement and increase performance. Methodological rigor was needed for complex procurement inefficiencies. Inefficient Saudi real estate acquisition was often caused by inadequate processes, planning, and stakeholder engagement. Every option risks using incomplete or biased data without a well-structured research. This study used a systematic approach to assure validity and reliability and produce actionable results that might affect sector policy and Volume-09 Issue 09, October-2025 ISSN: 2456-9348 Impact Factor: 8.232 International Journal of Engineering Technology Research & Management (IJETRM) https://ijetrm.com/ IJETRM (http://ijetrm.com/) [469] practice. Due to rigorous methodology, developers, contractors, and policymakers could believe Lean-based innovations were evidence-based and contextually relevant. The typical procurement workflow, as illustrated in Figure 2, is a complex, multi-stage process involving numerous departments and approval committees, from the initial proponent to the Procurement Department, Bid Review Teams, and the Service Award Committee (SAC). This intricate sequence of handoffs and reviews across different functional silos creates multiple opportunities for bottlenecks, communication gaps, and administrative delays that characterize the problem. Figure 2 Procurement Workflow & Process The concurrent embedded design gathered qualitative and quantitative data concurrently, with one technique as the main approach and the other as a support (Almeida, 2018). Semi-structured interviews dominated the study since mapping procurement procedures and detecting waste requires a detailed awareness of stakeholder viewpoints and concerns. Surveys showed how Lean principles affected procurement cycle speed, compliance, and cost projection accuracy. Qualitative Phase Data Collection: Participants were selected for competency and research relevance using non-probability purposive sampling (Palinkas et al., 2015). This ensured that responders had the knowledge and experience to provide procurement and Lean implementation advice. For the qualitative phase, 10–12 senior procurement managers, project directors, and consultants were purposefully sampled to describe procurement strategy and operations. Their help was needed to map procurement, identify value-stream bottlenecks, and provide Lean solutions. Data Analysis: Interviews were first transcribed, then analyzed using thematic analysis. A coding framework was developed afterward to identify recurring themes related to systemic inefficiencies, communication gaps, and cultural resistance. Quantitative Phase Data Collection: For the quantitative phase, a purposive sample of 30 stakeholders was selected, including developers, general contractors, and subcontractors. This mix helped ensure that results reflected residential, commercial, and mixed-use real estate projects. Data came directly from procurement specialists to improve accuracy. Volume-09 Issue 09, October-2025 ISSN: 2456-9348 Impact Factor: 8.232 International Journal of Engineering Technology Research & Management (IJETRM) https://ijetrm.com/ IJETRM (http://ijetrm.com/) [470] Instrument: The survey instrument contained four sections. It captured demographics and measured two key variable groups on a 5-point Likert scale (1= Strongly Disagree to 5= Strongly Agree): 1. Lean Adoption Practices: Use of Value Stream Mapping (Q8) and Frequency of Kaizen events (Q9). 2. Procurement Performance Indicators: Reduction in cycle time (Q12), improvement in cost accuracy (Q13), increased compliance (Q14), and overall stakeholder satisfaction (Q15). Data Analysis: The data were analyzed with IBM SPSS. The process included descriptive statistics, reliability checks using Cronbach's Alpha, Pearson correlation, simple linear regression, and one-way ANOVA to compare different types of organizations. RESULTS AND DISCUSSION Qualitative Key Findings: Thematic analysis of the 12 interviews revealed six key themes, with the following three being the most critical barriers to efficient procurement. Theme 1: Systemic Procurement Inefficiencies. This was the most dominant theme. Participants described procurement as a process burdened by "structural and cultural" inefficiencies. Three sub-themes were prominent: • Approval Bottlenecks: Delays were overwhelmingly attributed to "multi-tier approval procedures", especially those involving the Service Award Committee (SAC). One manager stated, "It often takes weeks to get approvals from the SAC, causing delays in the entire procurement cycle". • Frequent Design Changes: Instability in project scope was a major problem. Participants cited "late design changes" and "unclear specifications from consultants" after tenders had been issued, forcing time-consuming and costly rework. • Excessive Documentation: Procurement was described as a "document-heavy" process. Despite partial use of ERP systems, "repeated document checks and manual verification" were standard, leading to duplication and errors. Theme 2: Communication Gaps and Role Ambiguity Participants reported significant "communication fragmentation". A "misalignment between engineering and procurement" was consistently mentioned, leading to incomplete scope definitions and tender document errors. This was compounded by role ambiguity, where "it's unclear who is responsible for final cost approvals, finance or procurement?". This lack of accountability created conflict and delays. Theme 3: Cultural Barriers and Resistance to Change. A significant barrier to adopting new processes was resistance to change. This was rooted in a "fear of accountability". Participants noted that Lean-driven transparency, which exposes inefficiencies, made staff "hesitant about changing processes". This resistance was particularly strong among middle management, who were "used to the old ways". Other themes included a general Readiness for Lean Adoption (contingent on leadership support and training), high Perceived Benefits of Lean (especially reduced cycle times and better cost forecasting), and specific Recommended Improvements (digital workflows, ERP upgrades, and Kaizen workshops). Quantitative Key Findings: The survey data from 30 respondents provided statistical validation of Lean's impact. • Descriptive Statistics and Reliability: Respondents held a consistently positive view of Lean's impact. The mean scores for all four performance indicators were high: Increased Compliance (Mean = 3.77), Overall Satisfaction (Mean = 3.77), Cycle Time Reduction (Mean = 3.73), and Improved Cost Accuracy (Mean = 3.67). A reliability analysis of these four items showed strong internal consistency, with a Cronbach's Alpha of 0.769. • Correlation: VSM and Compliance: A Pearson correlation was run to test the relationship between the use of Value Stream Mapping (Q8) and Increased Compliance (Q14). The analysis found a large, positive, and statistically significant correlation (r=0.751, p<.001). This strongly suggests that organizations using VSM to map their processes experience higher levels of compliance with procurement standards. Volume-09 Issue 09, October-2025 ISSN: 2456-9348 Impact Factor: 8.232 International Journal of Engineering Technology Research & Management (IJETRM) https://ijetrm.com/ IJETRM (http://ijetrm.com/) [471] • Regression: Kaizen and Cycle Time Reduction: A simple linear regression was calculated to predict Cycle Time Reduction (Q12) based on the Frequency of Kaizen events (Q9). A significant regression equation was found (F(1, 28) = 166.1, p<.001), with an R^{2} of 0.856. This is a very strong finding: 85.6% of the variance in procurement cycle time reduction can be explained by the frequency of Kaizen activities. The standardized beta coefficient (beta=0.925) confirms that Kaizen frequency is a powerful predictor of improved efficiency. • ANOVA: Differences by Organization Type: A one-way ANOVA was conducted to compare performance benefits across four organization types (Developer, Main Contractor, Subcontractor, Consultant). The results showed a statistically significant difference in performance (F(3, 26) = 8.052, p=0.001). Post-hoc analysis confirmed that Developers reported significantly higher performance benefits from Lean adoption than the other groups. Key Results Tables: Variables Q8: VSM Use Q14: Compliance Improvement Q8: VSM Use 1.000 0.751 Q14: Compliance 0.751 1.000 (Correlation Between VSM and Compliance) Model R R² Adjusted R² Std. Error 1 0.925 0.856 0.851 0.267 Predictor B Std. Error Beta t Sig. Constant 0.000 0.294 - 0.000 1.000 Q9: Kaizen 1.000 0.078 0.925 12.889 0.000 (Regression Model Summary and Coefficients) The quantitative findings statistically confirm the qualitative insights, providing comprehensive validation of Lean’s impact. DISCUSSION This research confirms that Lean principles are highly effective tools for resolving documented procurement inefficiencies in the Saudi real estate sector. The mixed-methods design provides a robust interpretation of the findings, where the qualitative "problems" are directly answered by the quantitative "solutions." The qualitative analysis identified systemic delays from bottlenecks, rework, and poor communication (Themes 1 & 2). The quantitative results validate the specific Lean tools designed to fix these issues. The extremely strong predictive power of Kaizen on cycle-time reduction (R2=0.856) confirms it is the primary mechanism for driving operational efficiency. It directly addresses the delays identified by interviewees by providing a structure for continuous, incremental improvement. Similarly, the qualitative "fear of accountability" (Theme 3) and compliance challenges are directly addressed by VSM. The strong correlation between VSM and compliance (r = 0.751) supports the interpretation that VSM acts as a governance tool. By making processes transparent, VSM institutionalizes accountability, shifting the focus from individual blame to process improvement. Finally, the ANOVA result is explained by the qualitative findings on organizational readiness (Theme 4). Developers, who often have greater strategic oversight, stronger leadership commitment, and more advanced digital infrastructure (ERPs), are better positioned to implement and sustain Lean practices. This suggests that Lean adoption is not just a technical fix but a strategic initiative that requires top-down support and the right resources. Volume-09 Issue 09, October-2025 ISSN: 2456-9348 Impact Factor: 8.232 International Journal of Engineering Technology Research & Management (IJETRM) https://ijetrm.com/ IJETRM (http://ijetrm.com/) [472] This study contributes to the literature by moving beyond Lean-in-construction and providing specific, empirical evidence for Lean-in-procurement, particularly within the unique context of the Gulf region's mega-projects. ACKNOWLEDGEMENT I am deeply grateful to my supervisor, Prof. Mohammed Balubaid, for his guidance, helpful feedback, and steady encouragement during my research. His support made a real difference in the quality of my work. I truly appreciate Eng. AbdulRaheem Al-Saeedi, my line manager, for always supporting me and helping manage my workload so I could focus on my studies. His input as an interviewee also added real value to this research. I would also like to thank my colleague and fellow researcher, Eng. Ahmed Bashammakh, for his ongoing advice, helpful discussions, and generous support while I prepared this thesis. I am also grateful to all professionals and participants who contributed their time and expertise during the data collection phase, providing valuable perspectives that enriched this study. Finally, I want to thank my family, colleagues, and friends for their constant encouragement, patience, and belief in me during my academic journey. CONCLUSION This research confirms that traditional procurement frameworks are a critical bottleneck hindering the ambitious goals of Saudi Arabia's Vision 2030. The adoption of Lean principles is not merely beneficial but essential for strategic transformation. This study provides empirical proof that Value Stream Mapping (VSM) and Kaizen are the precise, high-impact tools to solve the sector's most pressing procurement challenges. VSM provides the diagnostic power to enhance transparency, standardize processes, and improve governance. Kaizen provides the engine for continuous improvement, systematically reducing approval delays, eliminating rework loops, and fostering a culture of cross-functional collaboration. Ultimately, successful Lean adoption depends on organizational readiness, strong leadership commitment, and digital integration. By embedding these principles, real estate organizations can transform procurement from a tactical cost center into a strategic, value-driven component of project delivery. Future studies may extend this analysis to digital Lean procurement applications across other Gulf Cooperation Council (GCC) economies. REFERENCES [1] Alahmadi, N., & Alghaseb, M. (2022). Challenging tendering-phase factors in public construction projects A Delphi study in Saudi Arabia. Buildings, 12(7), 924. https://doi.org/10.3390/buildings12070924 [2] Alajmi, A. M., & Memon, A. H. (2022). A review on significant factors causing delays in Saudi Arabia construction projects. 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