(07) 5806 project control

CE 5806 Project & Site ControlCE 5806 Project & Site Control

David Chua Kim HuatAssociate ProfessorAssociate Professor

E2-04-08, tel: 65162195 email: cvedavid

Assoc Prof David Chua Dept of Civil Engrg, NUS

Course Outline & PerspectiveCourse Outline & Perspective

Development and Organisation of Projects (week 1)– Project phases; organisational concepts; contractual relationships

Project Planning (week 1-3)– Managerial philosophy and function of planning; network methods; resource

levelling; linear scheduling; Project Control (week 4)

Managerial philosoph and f nction of control WBS sched le and cost– Managerial philosophy and function of control; WBS; schedule and cost control; earned value

Advanced Methods (week 5-7)– Schedule compression; probabilistic methods; theory of constraints; lean p ; p ; y ;

construction; critical chain; interface management Productivity Improvement (week 8-9)

– Factors affecting productivity; concept of work flows, capacity and bottlenecks Site Control and Contract Management (week 10-12)

– Documentation and quality management; contract management – variation and extension of time; construction safety and health


Control of Project Cost and ScheduleControl of Project Cost and Schedule

Key Issues:

1. Understand the key concepts in project control

2. Learn the earned value approach to project control & its importance

3. Know how to measure & track progress

4 U h WBS h d l d i j4. Use the WBS method to plan and organise project


Managerial Function of ControlManagerial Function of Control Critical to effective management is the supplying of information

– Type of informationAmount of information– Amount of information

Timeliness of control systemReporting period & dela in the reporting information; gi es– Reporting period & delay in the reporting information; gives rise to time lag in control

– Delay in reporting should be minimized to one or two weeks– Fast paced projects with many parties and contractual

obligations must be more tightly monitored.– Amount of work progress may overwhelm scheduler. p g y– Too often costly (time, overheads). May become a nuisance.– Waiting too long to update may eliminate effectiveness of

updating as a control tool – no time for corrective action


updating as a control tool no time for corrective action– If delay, can supplement with rough and ready control systems

Managerial Function of ControlManagerial Function of Control Example of timeliness vs accuracy

– Cost of materials can be reported at several stages and they affect the reliability of cost reports:

When order is placed (commitment)Material deliveredMaterial issued from storesMaterial actually usedInvoice paidp

If wait till invoice – long delay and useless for control purposesCommitment stage – inaccurate because may not be used or

delivered but timelydelivered but timelyThese are then corrected at later stages


Managerial Function of ControlManagerial Function of Control Level of detail

– Cost information for control if collected using cost codes existing in the company’s accounting system; can be a problemexisting in the company s accounting system; can be a problem

– Some activity based costing neededProject No Area Operation Distribution Cost08BE02 03 096600 01 $4 000

– Need to be balanced with the time to prepare; having approximately accurate information timely is more helpful

08BE02 03 096600 01 $4,000

pp y y pthan accurate information 2 to 3 months after the event

– Over controlled makes it cumbersome and expensiveS h i d l f h b?So what is a good rule of thumb?

– 20 – 80% ruleCritical items in greater detail, otherwise in summary level


Critical items in greater detail, otherwise in summary levelCritical items: high proportion or high escalation

Managerial Function of ControlManagerial Function of Control Data vs information

– 100 page report on procurement or 10 lines printout that 5 orders are likely to be lateorders are likely to be late

– Exception reporting, trouble spots and deviations

Obj i bj i d d i f i Objective vs subjective data and information– Should be as objective as possible– If subjective estimates could lead to 90% syndrome:

j ll il i i 90% lProject appears to progress well until it is 90% completeActual progress then has to catch up


Flooring09600

Example of CSI (Construction Specifications Institute) Format

09610 Floor Treatment Slip - Resistant Floor TreatmentStatic - Resistant Floor Treatment

09620 Specialty Flooring Asphalt Plank Flooring Plastic Laminate FlooringAthl ti Fl iAthletic Flooring

09630 Masonry Flooring Brick Flooring Marble Flooring Chemical - Resistant Brick FlooringFlagstone Flooring State Flooringg g gGranite Flooring Stone Flooring

Cushioned Wood Flooring Assemblies Mastic Set Wood Flooring AssembliesResilient Wood Flooring Assemblies

Wood Flooring09640

Resilient Wood Flooring Assemblies Wood Athletic Flooring Wood Block Flooring Wood Composition Flooring Wood Parquet Flooring Wood Strip Flooring

0965009660096700968009690

Resilient FlooringStatic Control FlooringFluid-Applied FlooringCarpetFlooring Restoration


09690 Flooring Restoration

Approach to ControlApproach to Control Variance Analysis Method

– Measures the difference What is the problem with this method?

between two factors, e.g. between actual and planned

– Examples:

Historic backward looking

Not effectively used to portray Planned vs actual startPlanned vs actual finishDuration milestones

y p yperformance

Duration, milestonesBudgeted vs actual costManhours, unit cost, % completeM d l lMeasured value vs actual cost


Approach to ControlApproach to Control Key questions that must be

answered:– What happened in the past?

– Is the rate of work accelerating or decelerating as it should?

Rate of build up of work cost and– What happened in the past?Are we on schedule?If variation, where, why, who?What effect and what can be done?

Rate of build up of work – cost and progress

S-charts

Is work within budget? Etc

– What is going to happen in the f

Thus, need to be forward looking, predicting, surfacing trends and sensitive enough to pick up adversefuture?

Are we going to be on schedule, budget?

Important to be aware of trends in

to pick up adverse performance as soon as it occurs so that something can be done to rectify itImportant to be aware of trends in

early stage to influence outcomeWhat is final cost and completion

date?

y


Approach to ControlApproach to Control Data not effectively used to give integrated control

Planned vs actual does not really tell PM whether more or less than budgeted have been expended.

Why??

Example:Activity budgeted cost cum. Budget actual cum. cost variance cum. variance

in period to date cost to date to date period to datep pA $60,000 $135,000 $66,000 $150,000 -$6,000 -$15,000B $45,000 $90,000 $39,000 $99,000 $6,000 $9,000

Does not show whether expenditure results in planned work completed


Simply – variance in cost could be cost related or schedule related

Approach to ControlApproach to Control$60,000 for A may represent the 500 units of excavation$66,000 is the actual cost of quantity not specifiedSay it is for 540 units and the estimated excavation cost is $120/unitSay it is for 540 units and the estimated excavation cost is $120/unitWork completed is worth $64,800, thus +ve variance of $1,200$64,800 is the earned value

Example:Activity budgeted cost cum. Budget actual cum. cost variance cum. variance

in period to date cost to date to date period to dateA $60,000 $135,000 $66,000 $150,000 -$6,000 -$15,000B $45,000 $90,000 $39,000 $99,000 $6,000 $9,000

Three sets of data available that needs to be integrated to giveThree sets of data available that needs to be integrated to give effective control

1. Planned 2 Actual


2. Actual3. Value earned (“earned value”)

Earned Value ApproachEarned Value ApproachExample:Activity budgeted cost cum. Budget actual cum. cost variance cum. variance

in period to date cost to date to date period to datep pA $60,000 $135,000 $66,000 $150,000 -$6,000 -$15,000B $45,000 $90,000 $39,000 $99,000 $6,000 $9,000

Quantities: 540 units

Variance in cost = Earned value – Actual cost

Quantities: 540 unitsCost: $120/unitEarned value= $64,800

Variance in cost Earned value Actual cost= $64,800 - $66,000= -$1,200

Meaning the concrete put in cost $1,200 more than it should

Variance in schedule = Earned value – budget cost= $64,800 - $60,000= $4 800

How much is planned?How much is done?


$4,800Meaning $4,400 more work was completed than plannedHow much ahead?

Key Cost MeasuresKey Cost MeasuresKey Cost MeasuresKey Cost Measures

ACWP: actual cost of work performed– amount reported as actually expended in completing work performed

BCWP: budgeted cost of work performed– budgeted amount of cost for work completed– “earned value of work performed”

BCWS: budgeted cost of work scheduled– budgeted amount of cost for the work scheduled to be performedg p

Variance Measures Alternatively– Cost variance = BCWP - ACWP CPI = BCWP/ACWPCost va a ce CW CW C CW / CW– Performance variance = BCWP - BCWS SPI = BCWP/BCWS

0 is favourable 1 is favourable


Earned Value ApproachEarned Value Approach Usual to use labour hours for weighted value

Project A example

gfor performance measurement

Master Activities EstimatedMan-hours

Scheduled Start

Scheduled Finish

Estimated CostMan hours Start

(end of day)Finish

(end of day)Cost

($1000)Site earth works 450 0 20 40Structural works 1,000 10 40 90M h i l i i 1 500 20 70 350Mechanical piping 1,500 20 70 350Control systems 750 40 80 140Reactor Towers 400 50 80 120Systems Check 300 80 95 60y

Total 800


1000's 0 10 20 30 40 50 60 70 80 90 95sumsite earth

k 0 20 40 0 20 20 40

Accumulative BCWSAssumed equally distributed

works 0 20 40 0 20 20 40structural works 10 40 90 0 30 30 30 90mechanical piping 20 70 350 0 70 70 70 70 70 350controlcontrol systems 40 80 140 0 35 35 35 35 140reactor towers 50 80 120 0 40 40 40 120systems check 80 95 60 0 40 20 60

BCWS 0 20 50 100 100 105 145 145 75 40 20 800accum. 0 20 70 170 270 375 520 665 740 780 800

800

900

BCWS

500

600

700

800

1000

's)

100

200

300

400

BC

WS

($

0

100

0 20 40 60 80 100

Project Days

Master Activities % complete Actual Cost

At end of day 40

Master Activities % complete Actual Cost($1000)

Site earth works 100 45Structural works 85 110Mechanical piping 20 65Mechanical piping 20 65Control systems 5 10Reactor towers - -Systems Check - -

Determine progress of project in terms of cost and schedule.

ACWP = $230 k

BCWP = 100% x 40k 40 k85% x 90k 76.5 k20% x 350k 70 k5% x 140k 7 k5% x 140k 7 k

total $193.5 k


$270K

Schedule and Cost Variances

BCWS

$270K

700

800

900ACWP

BCWS

300

400

500

600

BC

WS

($10

00's

)

BCWPAhead

0

100

200

300

0 20 40 60 80 100

B

Behind

0 20 40 60 80 100

Project Days8 days behind

$230K$193 5K


$ 30$193.5K

Actual progress compared with ES and LS curves

BCWS

700

800

900

ES LSProjected completion

300

400

500

600

BC

WS

($10

00's

)

ES LS

Actual progress

p

0

100

200

300

0 20 40 60 80 100

B

0 20 40 60 80 100

Project Days


Measurement of Work CompletedMeasurement of Work Completed

Units completed Applicable to tasks that are repetitive and require uniform effort

Number of precast beams to install for floor= 120

Number of beams installed = 75% complete = 75/120*100% = 62.5%

Start/Finish Applicable to activities of uncertain duration with no well-defined intermediate milestones.

Start activities are given a percent complete20 30% f l ti iti

Supervisor Opinion

say 20-30% for long activities

Informed judgement concerning completion status


Supervisor Opinion j g g pDewatering, constructing temporary facilities,

landscaping are usually judged this way

Incremental milestone approach:Applicable to activities which have multiple units of workApplicable to activities which have multiple units of work

with several sequential taskse.g. form, reinforce & pour concrete footings

Example: 150 footingsExcavation – 20 footings: 20*5% = 1Formwork 10 footings: 10*55% = 5 5

Foundation:Excavation 5%Formwork50% Formwork – 10 footings: 10*55% = 5.5

Rebar/embeds – 8 footings: 8*75% = 6Pour & finish – 30 footings: 30*85% = 25.5Strip & finish – 20 footings: 20*95% = 19

Formwork50%Rebar/embeds 20%Pour & finish 10%Strip & finish 10%Backfill 5% Backfill – 10 footings: = 10

Total:67 footings out of 150= 67/150*100% = 44.7%

Backfill 5%


Measurement of Work CompletedMeasurement of Work Completed

Cost ratio Applicable to tasks that are continuous and where costs bear a strong relationship to total effort required

l tif t tdate tohoursor work cost actualcomplete %

Weighted or i l t

Progress correlated to weight of material or some other units.

completionoforecast t

equivalent units


Project A exampleProject A example

Master Activities Weighted Value (man-hours)

Unit Quantity at completion

Quantity completed

Actualman hours

1.0 Site earth works 4501.0 Site earth works 4501.1 Site grading 200 m3 5,000 4,000 1501.2 Compacted building fill

180 m3 10,000 7,500 150

1.3 Fencing 70 m 800 610 601.3 Fencing 70 m 800 610 60

Master Activities Weighted Value (man-hours)

Man-hrsearned

Actual man hours( )

1.0 Site earth works 4501.1 Site grading 200 4000/5000 x 200 160 1501.2 Compacted building fill 180 7500/10000 x 180 135 1501.3 Fencing 70 610/800 x 70 53.4 60g

Total 348.4 360

Percent complete = 348.4/450 = 77.4%Productivity = 348.4/360 = 96.8%


Productivity 348.4/360 96.8%

NetworkNetwork--based Control Systembased Control SystemNetworkNetwork based Control Systembased Control System

Requires a well-defined work plan budget and schedule

Work breakdown structure -smallest unit is the work packageplan, budget and schedule

– provides the benchmarks for control

Must be developed with inputs

smallest unit is the work package– work defined in sufficient detail

to be be measured, budgeted, scheduled and controlled Must be developed with inputs

from people performing the work Must be communicated to all

participants

– several WPs in one activity or single WP comprising several activities

participants To be effective, must be simple to

administer and easily understood by all participants

Difference between network approach and cost accounting approach

by all participants Efficiency of system

– decide on level of detail, quantity of information, frequency of

ll i


collection

Work Breakdown StructureWork Breakdown StructureBuilding

Site work Foundations Structure Curtain wall Finishes Electrical

Survey Excavation Piles Pile caps Ground beams

Test piles Area 1 Area 2

Drive piles Inspect Clean Rebar Pour concrete

WBS used in planning stage to identify tasks and subtasks Assign responsibilities, achieve management control


No fixed rule for level of detail and breakdown structure

WBS HierarchyWBS HierarchySPower Station

Boiler house Turbine house Coal handling Water cooling plant plant

Cooling water pipes

Condenser foundations

Turbine blocks Retaining walls

Foundations Columns Machine platformFoundations Columns Machine platform

Rebar Prepare Formwork Erect formwork


WBS with organisation structureWBS with organisation structure

Oranizational structureuc

ture

eakd

own

Stru

Wor

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(07) 5806 project control

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