CONSTRUCTION PROJECT

MANAGEMENT TECHNIQUES

Dr. Vanita Ahuja

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Project Management Process Groups Mapped to

the Plan-Do-Check-Act Cycle
(Source: PMBOK)
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POGRESSIVE ELABORATION

Process groups are not one time events

They are overlapping activities occurring at varying levels of
intensity throughout each phase of project
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 Process groups are linked by the results they produce.

Output of one becomes the input of another
Within each Process group, individual processes are linked
by their inputs and outputs.
Each process can be described in terms of its:
Inputs: documents or documentable items that will be acted
upon
Tools and Techniques: mechanisms applied to inputs to
create the outputs
Outputs: documents or documentable items that are result of
the process.
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PROJECTS HAVE MULTIPLE PHASES

INITIAL PHASE

INTERMIDIATE PHASE(s)

FINAL PHASE

PROJECT PHASES AND PROCESSES

(Source: PMBOK)
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FORMAL PROJECT MANAGEMENT

HENRY GANTT (1917)

Bar Chart
POLARIS (1958)
Programme Evaluation and Review Technique
(PERT)
DuPont Company (1960)
Critical Path Method (CPM)
1960s NASA Projects Apollo etc.
q Work Breakdown Structure
q Time and Cost Tracking

PLANNING TIME
1. What is to be done?
Define scope of work

4. When it is to be done?
Schedule work

2. What are the activities

involved?
Break down project work
into activities

3. How it can be done?

Develop network plans

WORK BREAKDOWN STRUCTURE

PROJECT
1.1 Sub Project 1

1.1.1 Work Package 1

1.1.1.1 Task 1

1.n Sub Project n

1.1.n Work Package n

1.1.1.n Task n

1.1.1.1a Activity 1
1.1.1.1n Activity n
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CAMPUS PROJECT
1.1 SITE WORK

1.2 BUILDING 1

1.3 BUILDING 2

1.1.1 Layout

1.2.1 Layout

1.3.1 Layout

1.1.2 Earthwork

1.2.2 Excavation

1.3.2 Excavation

1.1.3 Paving

1.2.3 Foundations

1.3.3 Foundations

1.1.4 Landscaping

1.2.4 Structure
1.2.5 Services

1.3.4 Structure
1.3.5 Services

1.2.6 Finishes

1.3.6 Finishes

1.1.5 Site
Improvements
1.1.6 Utilities
1.1.7 Services

Location Based WBS

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1.2.4 STRUCTURE
1.2.4.1 Basement Columns and Slab
1.2.4.2 G.Floor Columns and Slab
1.2.4.3 F.Floor Columns and Slab
1.2.4.4 T.Floor Columns and Slab
1.2.4.5 Fourth Floor Columns and Slab
1.2.4.6 Fifth Floor Columns and Slab
1.2.4.7 Sixth Floor Columns and Slab
1.2.4.10 Roof Works
1.2.4.11 Staircase

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One WBS per project/program

q Deliverable-oriented
q Work not in the WBS is out-of-scope
q Each descending level represents more detail

Lowest level activities include

q Defined deliverable(s) or Scope of Work
q Timeframe for Completion
q Total cost (direct and indirect)

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PLANNING TIME
1. What is to be done?
Define scope of work

4. When it is to be done?
Schedule work

2. What are the activities

involved?
Break down project work
into activities

3. How it can be done?

Develop network plans

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ACTIVITY DURATION ESTIMATION

It is based on:
q Decision making structure in the organization
q Methodology adopted for executing the activity
q Resource availability and planning

Resource planning includes:

q Workers output norms
q Plant and Machinery output norms
q Materials quantity estimation and wastage norms

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ONE TIME ESTIMATE DETERMINISTIC DURATION

Duration =

Quantity of Work
--------------------------------------------------------------------Output per unit of resource x Resources earmarked

CRITICAL PATH METHOD (CPM)

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THREE TIME ESTIMATE

PROBABILISTIC ESTIMATION

Research projects
Limited previous data
Captures schedule (and implicitly some cost) risk
Conceptual stages of projects
Contractual arrangements like Design-Build/BOT etc.

PROGRAM EVALUATION REVIEW TECHNIQUE (PERT)

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A - optimistic time estimate

q
q

M - most likely task duration

q
q

Minimum time in which the task could be completed

Everything has to go right
Task duration under normal: conditions
Most frequent task durations based on past
experience

B - pessimistic time estimate

q
q
q

Time required under particularly bad circumstances

Most difficult to estimate, includes unexpected delays
Should be exceeded no more than 1% of the time
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Duration =

A + 4M + B
6

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ba
Activity Variance = =

Project Variance =
Sum of variance of activities on the Critical Path

If more than one Critical Path

Project Variance=
Sum of variance of activities on the longest Critical Path
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LINKS/DEPENDENCIES
Finish Start (FS with 0 days lag)

Finish Start (FS with x days lag)

X days
Time
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Start Start

(SS with x days lag)

X days
Finish Finish (FF with x days lag)

X days
Time
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RISK ASSESSMENT PROJECT TIME

Probabilistic duration estimation helps in risk assessment for

time

Let calculated project duration = 45 days

Probability of completing the project in 50 days?
Variance of the schedule = 9
Standard deviation = SquRoot 9 = 3
Z = 50 45 = 1.67 standard deviations
3
It gives probability = 95.25%
(read from normal probability distribution table)
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Probability =
shaded area of the curve corresponding to value of Z x 100
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RESOURCE AND COST

SCHEDULING

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PLANNING RESOURCES AND COST

1. What is the Resource
requirement schedule?
manpower
materials
equipment
Derived from Time schedule

3. Budget?
Direct cost from the total
resource requirement
Indirect
cost
from
organisation guidelines

2. What is the Resource

Procurement schedule?
Derived
from
Resource
schedule

4. Cash flow?
Derived from the Time
Schedule and Resource
Schedule
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RESOURCES

WORK RESOURCES

MATERIAL RESOURCES

Manpower

Equipment

Material

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Superimpose resource requirement for each type of

resource that is required to be planned/scheduled.

RESOURCE LOADING

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Calculates total resource requirement

Resource usage pattern
Overallocated resources

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Resource Leveling (Step 1)

Increase the duration of Activity 3 by 1 day and reduce resource requirement by 1
unit/day

RESOURCE LEVELING

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Resource Leveling (Step 2)

Increase the duration of Activity 3 by 2 more days day and reduce resource requirement
by additional 0.5 unit/day

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CUMULATIVE RESOURCE USAGE CURVE

cumulative requirement

resource 1
450
400
350
300
250
200
150
100
50
0

resource 1

time period

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RESOURCE SCHEDULING OBJECTIVES

Validates the time objectives

Optimises the resources employed
Forecasts the input resources
Evaluates the implications of scheduling constraints
Establishes Target resource requirement with which the
actual resource usage would be compared

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PLANNING RESOURCES AND COST

1. What is the Resource
requirement schedule?
manpower
materials
equipment
Derived from Time schedule

3. Budget?
Direct cost from the total
resource requirement
Indirect
cost
from
organisation guidelines

2. What is the Resource

Procurement schedule?
Derived
from
Resource
schedule

4. Cash flow?
Derived from the Time
Schedule and Resource
Schedule
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RESOURCE PROCUREMENT SCHEDULE

Resource
requirement
date

Duration
for which
the
resource
can be
stored

Resource
receipt
date

Time
taken by
the vendor
for
supplying
resource
Time
taken to
organise
resource

Date of award
of work for
supplying
resource

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PLANNING RESOURCES AND COST

1. What is the Resource
requirement schedule?
manpower
materials
equipment
Derived from Time schedule

3. Budget?
Direct cost from the total
resource requirement
Indirect
cost
from
organisation guidelines

2. What is the Resource

Procurement schedule?
Derived
from
Resource
schedule

4. Cash flow?
Derived from the Time
Schedule and Resource
Schedule
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COST SCHEDULING OBJECTIVES

Establishes cost of each activity

Establishes cost of the project and cash flow pattern

Establishes Target cash flow pattern with which the

actual cash flow requirement would be compared

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PROJECT COST/BUDGET

DIRECT COST

INDIRECT COST

Cost of Resources

Overheads and Infrastructure

Cost

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Team Member Rate: Rs. 2,500.00/day

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CRASHING THE SCHEDULE

Compute Cost/Time slope for each
Activity

CRASH
COST

Slope = Crash Cost Normal Cost

Crash Time Normal Time

NORMAL
COST
CRASH
TIME

Crash time leads to use of more

resources in less time and more cost

NORMAL
TIME

Apply Crash time to Critical

Activities
Recalculate the Critical path and
repeat the above steps
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Crashing of Critical Tasks leads to increased Direct

Cost
Indirect Cost decreases as Project duration decreases
Minimise the sum of Direct Cost and Indirect Cost

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TYPICAL COST PATTERN

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TRACKING AND MONITORING

OF PROJECTS

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PERFORMANCE PARAMETERS TO BE
CONTROLLED

Time Progress Control

Resource Productivity Control
Resource Mobilisation Control
Direct Cost Control
Budgeted Cost Control
Earned Value Control

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VARIANCE ANALYSIS
q

Backward Looking

TRENDS FORECASTING
q

Provides a tool for forecasting future requirements

of resources

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TIME PROGRESS CONTROL

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VARIANCE ANALYSIS - TIME

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VARIANCE ANALYSIS - WORK

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VARIANCE ANALYSIS - COST

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TRENDS FORECASTING EARNED VALUE ANALYSIS

Measures a projects progress

Forecasts its completion date and final cost

Provides schedule and budget variances

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EARNED VALUE CALCULATIONS

BCWS - Budgeted Cost of Work Scheduled
Planned cost of the total amount of work
scheduled to be performed by the status date.
ACWP - Actual Cost of Work Performed
Cost incurred to accomplish the work that has
been done to date.
BCWP - Budgeted Cost of Work Performed
The planned (not actual) cost to complete the work
that has been done.
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BCWS

ACWP

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/ETC

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DERIVED INDICES
SV: Schedule Variance (BCWP-BCWS)
q A comparison of amount of work performed during a
given period of time to what was scheduled to be
performed.
q A negative variance means the project is behind
schedule
CV: Cost Variance (BCWP-ACWP)
qA
comparison of the budgeted cost of work
performed with actual cost.
q A negative variance means the project is over
budget.
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SPI:

Schedule Performance Index (BCWP/BCWS)

SPI<1 means project is behind schedule

CPI:

Cost Performance Index (BCWP/ACWP)

CPI<1 means project is over budget

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CPI: Cost Performance Index (BCWP/ACWP)

CPI<1 means project is over budget
CPI:

Budgeted Cost of Remaining Work

Estimate to Complete (ETC)
Budgeted at Completion (BAC) BCWP
ETC
ETC: BAC BCWP
CPI
EAC (Estimate at Completion): ETC + ACWP
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EXAMPLE
120000

BAC = 102000

100000
80000

BCWS

56000
60000

BCWP

55000
49000

40000

ACWP

20000
Dec-03

Nov-03

Oct-03

Sep-03

Aug-03

Jul-03

Jun-03

May-03

Apr-03

Mar-03

Feb-03

Jan-03

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Schedule Variance = BCWP-BCWS = 49,000 55,000 = -14,000

Cost Variance

= BCWP-ACWP = 49,000 56,000 = - 7,000

SPI = BCWP/BCWS = 49,000/55,000 = 0.891

CPI = BCWP/ACWP = 49,000/56,000 = 0.875
ETC = (BAC BCWP)/CPI = (102,000 49,000)/0.875 =
60,571.42
EAC = ETC + ACWP = 60,571.42 + 56,000 = 116,571.42
Cost Variance = EAC BAC = 108,571.42 102,000 = 6,571.42
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DIFFERENCE BETWEEN TIME CHAINAGE

CHART AND BAR/GANTT CHART
Gantt chart displays time horizontally and a list
of tasks vertically. The spacing of task lines
vertically is not related to any physical location.
A time chainage chart provides a second
dimension to an event by adding the start and
end measurements to the start date, end date
and duration.
This additional dimension makes it is easier to
visualise what is happening at a given location
at any time and what processes are passing
through any position.
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QUESTIONS
AND
DISCUSSION

vanita_ahuja@yahoo.com
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