production management in construction-intro

Production Management in Construction

Sina Rezvani D.Eng. MRes, PhD, MIEE, MEI

University of Ulster, Jordanstown

School of the Built Environment

Course outline§ Introduction§ Resource allocation§ WBS§ Time management: Gant Chart§ Critical Path method § Budgeting§ Statistics§ Test

The nature of a project

A project is a sequence of unique, complex, and connected processes and activities having one goalor purpose and that must be completed by a

specific time, within budget, and according to specifications.

Projects are§ Sequence of connected activities§ Interrelated activities§ Complex§ Unique§ Temporary endeavor undertaken to create a

unique product or service

Projects have§ Purpose § Goal§ a definite beginning and end§ Specific outcome

Failure often results from flawed perceptions of what is involved in successfully managing complex system development from inception through completion.

Kevin Forsberg: Visualizing Project Management

Source: Humor in Systems Analysis

What are the major tasks?How will we do it?

Does it fit your goals?Is it worth it?

Why will the customer buy it?Can we win?

Do you have the capability?Can we do it?

What is its application?What is the product?

Who is your customer?What is the need?

Projects require§ Budget§ Human resources

Being temporary, projects often bring together people unknown to each other.

§ Problem solving skills§ Resources§ Planning§ Organisation§ Control§ A detailed project schedule§ List of all works

Project limitations§ Controllable:

SpecificationsDeadlinesBudgetSkillsExperience

§ Beyond our control: EnvironmentalPoliticalGlobal

Projects involve§ New people, new teams§ Collaboration§ Communication

Explaining tasks to all team membersAssigning tasksDefining successKeeping everyone informed

§ Interaction with a wide range of peopleTracking systemComparing performance with plan

§ Assumptions§ Risks§ Decision making process

Project Characteristics Summarised

§ Capital investment§ Finite duration§ Involvement of people and groups with different

expertise§ Complex tasks§ Time limitation§ Different phases§ Risky at the start

Project inception§ Projects don’t fall from sky, they are created§ Feasibility studies / Project evaluation§ Planning § Coordination of interrelated activities§ Resource allocation

Project planning§ Historical Records – need to collect and use for

planning, estimating and risk§ Meetings to consult on project scopes§ Work Breakdown Structures§ Do not introduce benefits that are not stated in

requirements§ Needs of all stakeholders should be taken into

account during all projects§ Team Members must be involved in project

planning§ Project Manager must be pro-active

Examples§ Building a power plant§ Installing a new subway systems

Implementation§ The application of knowledge, skills, tools and

techniques to project activities in order to meet or exceed stakeholder needs and expectations from a defined project – balancing the following:

Scope, time, cost, and qualityStakeholders’ expectationsRequirements (needs) vs. unidentified requirements (expectations)

Resources

Time (Schedule, Deadline)

Costs

Success

Products

§ Created as a result of a project§ Complex objects with many dimensions§ Functionality§ Manufacturing process§ Product management§ Quality control§ Marketing§ Maintenance of the manufacturing line§ Service and support§ Product life cycle§ Development cost vs. manufacturing cost

ManagementDefiningPlanningOrganisingStaffingExecutingControllingDirectingCompletingDocumentationFeedback

LowHighHighLowLowCost control level

HighHighHighLowLowConflict intensity

YesYesYesNoYesProject Sponsor present

Middle M.Top M.Top M.Top M.Middle M.PM's supervisor

HighExcessiveExcessiveLowExcessiveNumber of meetings

HighHighHighLowLowTime management difficulties

HighLowLowLowLowOrganisational structure

HighHighHighLowLowInterpersonal skills

MISAerospace/Military

Large Construct.

Small Construct.

In-house R&D

CLASSIFICATION OF PROJECTS

LIFE-CYCLE PHASE DEFINITIONS

Commissioning

ConstructionConversion

Detailed Eng.ImplementationFinal Audit

Major reviewDesignPhase-outTermination

Basic Eng.DefinitionProductionMain

PlanningPlanningBuildupDefinition

Data gatheringConceptualFormationStart-up

ConstructionITManufacturingEngineering

Project Plan

• Why?

• What?

• When?

• Who?

• How?

• How Much?

• Objectives

• Products

• Milestones

• Responsibilities

• Approach

• Resources & Effort

Project Scoping§ An early planning step in the development of a project where

all project requirements are defined and a plan is developed to address them.

Google web definition

§ A Project Scoping Study gives the project manager the opportunity to look at and assess the project before it becomes formally "live". Not so much to query whether the project should go ahead but to establish how it needs to be organised and managed, specifically:

üwhat the project aims and objectives should be üwhat the risks and possible difficulties are, üand how the project should be organised and tackled.

Lindsay Sherwin 2007

Assumptions, Risks, Obstacles:

Success Criteria (Outcomes):

Objectives (Specific, Measurable, Assignable), Duration? Cost?

Project Goal:

Problem / Opportunity (Why do this project?):

Team MembersProject ManagerProject Name

Project Scoping Form

Human resource planning§ Definition:

“The process for ensuring that the HR requirements of an organisation are identified and plans are made for satisfying those requirements.”

§ Activities involved:Identify and acquire the right number of people with the proper skills.Motivate them to achieve high performance.Create interactive links between business objectives and people-planning activities.

Aims of HRP

§ Attract and retain the number of people required with the appropriate skills, expertise and competencies§ Anticipate the problems of potential surpluses or

deficits of people;§ Develop a well trained and flexible workforce to

contribute to the organisation’s ability to adapt to an uncertain and changing environment;§ Reduce dependence on external recruitment

when key skills are in short supply by formulating retention, as well as employee development strategies;§ Improve the utilisation of people by introducing

more flexible systems of work.

Practice§ Resourcing strategy§ Scenario planning§ Estimating future requirements§ Labour turnover§ Action planning

‘HARD’ and ‘SOFT’ HRP

Hard HRPQuantitative analysis to ensure that the right number and sort of people are available when needed

Soft HRPEnsuring the availability of people with the right type of attitudes and motivation who are committed to the organisation and engaged in their work and who behave accordingly

Soft HRP§ Soft HRP is based on assessments of the requirement for

these qualities and measurements of the extent to which they exist, by:

Using staff surveysAnalysing outcomes of performance management reviewsAnalysing opinions generated by focus groups

The HRP Process

Four main categories of staff:

§ Existing staff§ New recruits§ Potential staff§ Leavers

WBS

§ Functional decomposition of a system§ Breaks the project into chunks of work at

a level of detail that meets planning and scheduling needs§ Object oriented WBS§ Task oriented WBS

http://www.successfulprojects.com/

Project Selection 1.1.1.1.1

Project Organization

1.1.1.1.2

Project Planning 1.1.1.1.3

Chapter 1 1.1.1.1

Budget & Cost

1.1.1.2.1

Scheduling 1.1.1.2.2

Project Controls 1.1.1.2.3

Auditing 1.1.1.3.1

Administrative Closeout

1.1.1.3.2

Writing Text Book

1.1.1

Editing Text Book

1.1.2

Publishing Text Book

1.1.3

Project Management- An Introduction

1.1

BEST Management Books

1.

Chapter 2 1.1.1.2

Chapter 3 1.1.1.3

Editing Chapter 1

1.1.2.1

Editing Chapter 2

1.1.2.2

Editing Chapter 3

1.1.2.3

Project Selection 1.1.1.1.1

Project Organization

1.1.1.1.2

Project Planning 1.1.1.1.3

Chapter 1 1.1.1.1

Budget & Cost

1.1.1.2.1

Scheduling 1.1.1.2.2

Project Controls 1.1.1.2.3

Auditing 1.1.1.3.1

Administrative Closeout

1.1.1.3.2

Writing Text Book

1.1.1

Editing Text Book

1.1.2

Publishing Text Book

1.1.3

Project Management- An Introduction

1.1

BEST Management Books

1.

Chapter 2 1.1.1.2

Chapter 3 1.1.1.3

Editing Chapter 1

1.1.2.1

Editing Chapter 2

1.1.2.2

Editing Chapter 3

1.1.2.3

WBS ? Organisational chart

Preparing a WBS§ Iterative consideration of the project’s purpose§ Functional/performance design criteria§ Project scope, technical performance

requirements§ Conceptual stage: A high-level WBS§ Specifications at lower levels§ Think deliverables§ Clear vision of the end product

Assumptions

§ Aggregation of all subordinate works§ Decomposition to the level of production§ Each element => a single tangible deliverable§ Avoid duplication of efforts

§ Each subordinate element => Only one single parent § Logical partitioning of deliverables§ Deliverables unique and distinct from their peers§ Deliverables: optimised in size, controllable§ Costs, resources and manpower§ Consolidation of the whole project cost

Level of details

§ Improving the accuracy of the estimation§ Defining a responsibility for each deliverable§ Number of deliverables for each WBS elements§ Accuracy of the work processes timing§ Cost definition§ Time gaps in the execution of the work processes§ Resource requirements changes over time within a

WBS element?§ Prerequisites among internal deliverables§ Objective criteria for measuring progress§ Risks § Dependencies between deliverables§ Aggregation of a portion of the work as a unit

Cost estimation

1. Exergy cost Analysis§ Evaluation of the cost for each stream§ Internal cost/ not market cost

2. Parametric estimation§ Based on historical data§ Mathematical modelling of available key features

3. Factored Cost estimate/Bottom-up approach§ Work breakdown structure§ Allocation of costs to individual elements

4. Analogous system estimate/Top-down approach§ Case based approach/inferential cost estimation of the entire system§ Comparison and extrapolation§ Cost adaptation and optimisation§ Cost breakdown

5. Vendor quotes§ Costs are obtained from vendors.

6. Cost scaling§ Factors used to scale up/down costs

Erection of a small workshop

Source: Denis lock

2195318036Total estimates costs

120801Clear away (requires skips)6.4

001Connect electric main supply6.3

1602502Install electrics6.2

60701Concrete hard standing for cars6.1

35501Fit door furniture5.4

202001Paint doors and windows5.3

30501Glaze Windows 5.2

20801Prime doors and window frame5.1

25801Hang doors4.4

601001Fit gutters and rainwater pipes4.3

701101Seal roof sheets4.2

2002202Fit roof sheets4.1

40751Cap parapets3.4

1804003Cut and fit roof timbers3.3

302002Finish brickwork3.2

301001Install RSJ Lintel over doors3.1

7550Install window frame2.4

7507005Build walls2.3

100101Position door frame2.2

005Cure time for concrete base2.1

150801Concrete base1.4

40501Formwork for base1.3

01501Dig soakaway and drain trench1.2

0751Clear and mark out the Site1.1

Materials cost (£)Labour Cost (£)Days

Factored cost estimation

§ Costly: significant effort (time/money) required§ Insight into major cost contributors. § Relationships among cost elements

§ Not responsive to "what if" requirements§ Possibility to forget important elements

),(1 1 111

ji

m

j

n

i

m

jij

k

llljj

n

iii prhqprbc ∑ ∑∑∑∑

= = ===+⋅+⋅+⋅+= ςβα

Investment costs + fixed engineering costs + Soft costs + variable engineering costs

§ Based on actual historical data§ Relies on extrapolation and expert judgement§ Relies on single data point§ Difficult to identify appropriate analogues§ Quick way of estimation§ Readily understood§ Select adaptation method§ Combined with Parametric and scaling methods § Complexity factors (CF)

• Assess the complexity of the new subsystem compared to that of the selected analogues

• Make a quantitative judgment for a value of the complexity factor

Analogous System Estimate

Cost scaling (CS)Cost scaling (CS)

YBYB

YAYA C

II

C ⋅=

•CYA = Cost in year A

•CYB = Cost in year B

•IYA = Cost index for year A

•IYB = Cost index for year B

B

S

B

AA CC κκ κ

κ⋅

=

•CκA = Cost at capacity A

•CκB = Cost at capacity B

•κA = Equipment or plant capacity A

•κB = Equipment or plant capacity B

•S= Scaling factor

ü(Values can be found: Haselbarth, Galagher)

Building cost index

§ Steel frame construction cost index§ Concrete frame construction CI§ Brick construction CI§ Labour cost index

Estimating Building costs: Calin M Popescu et al.

Exercise 1

§ Cost of a building in 1985: £5M§ Construction Cost Index 1985: 374§ Construction Cost Index 2009: 817§ Estimate the cost of a similar building in 2009.

Exercise 2

§ A. Construction of a building with 300sqm spaceCost 1.5 M

§ B. Similar building30% smaller

§ Scaling factor: 0.75§ What is the cost of B?

Project Planning: Resources• People - skills and value• Facilities/Equipment/ Materials• Systematic task allocations • Capital cost estimation/Economic

Analysis• Time (project duration)• Relation ship and dependencies

Duration - Estimation

• Similarity to other activities• Historical data• Expert advice• Mathematical models

Duration is a Cause of Variation

• Sources of variation:– Varying skill levels– Unexpected events– Efficiency of work time– Mistakes and misunderstandings

Relationships

• Network diagram

• Finish to start

• Predecessor Task: A

• Successor Task: B

• Activity A Must Be Finished Before B Can Start

• Arrow head indicates dependency relationship: Task B cannot begin until Task A is complete

A B

Consider lag and lead time

D

E

F

G

FrameHVAC

Rough Electric

H

Sheet Rock

Exercise 3: Dependencies

1. Activity C and D both follow AActivity E follows CActivity F follows D Activity E and F precede B

2. Activity G and F precede HActivity G and D precede J Activity M and H precede LActivity F follows A Activity A and D start at the same timeActivity J and L finish at the same time Activity K and A precede L

construction of a single family home.

Building a house

Time ImmediateRequired Predecessor

Activity Description (in days) ActivitiesA Excavate --B Lay foundation AC Rough plumbing BD Frame/walls BE Finish exterior DF Install HVAC DG Rough electric DH Sheet rock C, E, F, GI Install cabinets HJ Paint HK Final plumbing IL Final electric JM Install flooring K, L

Time ImmediateRequired Predecessor

Activity Description (in days) ActivitiesA Excavate 3 --B Lay foundation 4 AC Rough plumbing 3 BD Frame 10 BE Finish exterior 8 DF Install HVAC 4 DG Rough electric 6 DH Sheet rock 8 C, E, F, GI Install cabinets 5 HJ Paint 5 HK Final plumbing 4 IL Final electric 2 JM Install flooring 4 K, L

CPM

§ Most important chain of tasks in a project

§ The start of each task depends on the completion of the previous task.

§ The tasks are carried out by a person or a group.

§ If CPM is completed later as it was scheduled the entire project completion will be delayed.

CPM in construction

§ Sequence of construction operation§ Predict construction completion time§ Identification of critical activities§ Project time reduction measures§ Balanced scheduling of manpower§ Progress report§ Project evaluation

Milestones

§ Milestones are significant events on a project that normally have zero duration

§ You can follow the SMART criteria in developing milestones that are:

SpecificMeasurableAssignableRealisticTime-framed

CPM: Definition§ CPM is a project network analysis technique used to

predict total project duration§ A critical path for a project is the series of activities that

determines the earliest time by which the project can be completed

§ The critical path is the longest path through the network diagram and has the least amount of slack or float

Finding CPM§ First develop a good project network diagram§ Add the durations for all activities on each path

through the project network diagram§ The longest path is the critical path

CPM

§ EST, LST, EET, LET§ Critical path§ Buffer time=LST-EST or LET-EET

PERT

§ Programme§ Establishing project baseline§ Bottlenecks§ Evaluating progress§ Resource levelling

Project duration

Shortening project time§ Shorten durations of critical tasks by adding

more resources or changing their scope§ Crashing tasks by obtaining the greatest amount

of schedule compression for the least incremental cost§ Fast tracking tasks by doing them in parallel or

overlapping them

?72Total

Excavator5323G, HM13

Concrete Gang9634J, K, GL12

Concrete Gang6412A, FK11

11846EJ10

Excavator7446EI9

8535DH8

Concrete Gang14934CG7

10612B, DF6

Concrete Gang8534AE5

12823StartD4

Excavator6346StartC3

Concrete Gang10735StartB2

Excavator7434StartA1

Cr.N.Cr.N.

Trade/PlantCostDurationPred.Activity

OverlappedTasks or fasttracking

Shortenedduration thrucrashing

Original schedule

Activity Preceding Duration Resources1 A Start 2 42 B A 1 2 23 C A 1 3 24 D A 1 5 35 E B 2 2 26 F B,C, D 2, 3, 4 4 37 G D 4 6 48 H E 5 4 29 I E, F 5,6 2 2

10 J F, G 6, 7 4 311 K H, I , J 8, 9, 10 2 2

000 day0 daysMilestoneG, H, IEnd11

642 days3 days1 Joiner teamFI10

1181 day2 days4 LabourerFH9

20163 days4 days1 Joiner teamEG8

25184 days6 days3 LabourerDF7

432 days3 days1 LabourerC, DE6

26202 days3 days1 Concrete GangA, BD5

36243 days4 days1 Concrete GangAC4

30253 days5 days1 ExcavatorStartB3

1281 day2 days4 LabourerStartA2

000 day0 daysNoneNoneStart1

CrashNormal CrashNormal

Cost in k£Duration

ResourcesPredece

ssorTaskTask No.

1 excavator, 1 concrete gang, 1 joiner team and 4 labourers.

£142K

Gantt Chart• Visual scheduling tool• Graphical representation of information in WBS• Show dependencies between tasks, personnel,

and other resources allocations• Track progress towards completion

Building a Gantt Chart

• Dependencies: Show dependencies between activities with arrows– E.g., activity 2 cannot start until activity 1 is complete

Activity 1

Activity 2

Milestone

Time Frame: day 1 day 2 day3… day 23