Challenges in construction industry

Hi Charlie,

I’ll be glad to discuss with you all necessary details. My E-mail: spider@mail.cnt.ru. We use these approaches in a lot of construction projects right now. I mentioned some simplification that is used on the seller side - to define the cost of the day instead of calculating NPV. But the core thing - management by trends.

Regards,

Vladimir

Hi Vlad,



I did read your msp.ppt. It is 60 pages and some terminology I remember sometimes in my college days like NPV,



I do like it



The biggest challenge is how, how to use it.



We will talk about it someday, if I have the time to digest what it is all about and how to use it in my situation.



Regards,

Charlie

Oh sorry



But then, why do cry for spill milk, the only way is to move on and kick ass so that the risk of not achieving milestone, overall completion dates will be achieve.





It should be like this:



But then, why do cry for spill milk, the only way is to move on and kick ass so that the risk of not achieving milestone, overall completion dates will be not be realize, hence the achievement of milestone dates and overall completion dates.

I thank you Vlad,



You did open a new dimension on the way I’m doing things.



I’m presently involved in development project that gone tupsy turvy from the very start. The whole concept of project management is kaput or fuck up.



It started from the design, procurement and construction practically the whole project life cycle. What really happend is that the project is going circle: meaning we are in the construction stage but there is still no approved for construction drawings, the management of change is really a nightmare



and the worst is that the client is still thinking that the project management team will deliver the project on schedule. On schedule is the most important factor for the client because the client is expecting to get revenue.



I’m the inhiritor of the chaos, so looking back, I think have it been the project management conducted an honest risk management on the master program and schedule, the scenario now should have not happened.



But then, why do cry for spill milk, the only way is to move on and kick ass so that the risk of not achieving milestone, overall completion dates will be achieve.



Cheers,

Charlie

Your example was about time and that is why I discussed time. Of course identifying risks you shall develop some responses that make risk impacts lower. But what about the weather? In any case you will come to some range of potential results.

Risk simulation helps to calculate what reserves (buffers) shall be created for costs, for time, for materials. etc.

And the schedule that we suggest to use on site does not include these buffers.

Please look at the presentation that explains the approach. We used it in many construction projects and it works fine.

I think the point here is that the challenge in construction to achieve attainment of completio dates is to evaluate the critical path, critical activities and conduct risk management. Basically, risk management is the identification of risk and the elimination of the risk, meaning DO SOMETHING THAT IT WILL NOT HAPPEN.



But if our software only evaluate the time element meaning on schedule, then it is still not enough because



SUCCESS IN PROJECT MANAGEMENT MEANS, ON TIME (as discuss about), within budget, and within quality

and going back to the simple example of structural column,



what if solutions are found to eliminate the risk that the column will be delay in 5 days. How about the succeeding activities, say, roofing, and finishing works???

In real life situation???



For example in metro rail project, generally, individual planners are assing to area of jurisdiction say, viaduct planner, underground or tunelling planner, station planner, design planner, rail system planner.



The viaduct planner may conduct a risk analysis showing the movement of LG or lunching gantry relative to actual and projected installation of viaduct element: piles, pile cap, pier, pier cap and the segment installation that involved the LG’s or launching gantry.



The risk analysis may show that the probability that the planned dates may not be achieve is very high.



As a consequence, a lot of engineers maybe fielded, from the owner side, from the consultant side, from the contractor side to ensure factors that influence the delays in attaining planned dates will be eliminated. This may result in neutralizing and eliminating the factors that causes delays in achieving planned dates for the launching gantry to move.



But in metro rail, the viaduct is only a portion of the overall scenario. The viaduct may be able to achieve the planned dates, but how about the others, says tunelling, construction of stations, design and drawings, rail system.

So there is a need to create project scenarios. Optimistic - all 20 columns will installed without delays, most probable is as usual - let’s say weather conditions or other reasons usually lead to 3 days delay. Pessimistic - the delay will be 8 days due to the additional problems with energy supply and equipment.

The same shall be done with other activities.

Then you shall think about potential risk events that may delay the construction and add them into most probable and pessimistic scenarios depending on probabilities. Having 3 scenarios you will be able to estimate the range of potential results and to estimate the probability to meet any target.

The forecasts will be much more reasonable.

So we planners are suppose to be pro-active or maybe they will call us similar to that bedtime story (not popular in todays generation): "THE BOY WHO CRIED WOLF". Ohh and oppss

I agree that planners do need to consider risk management in the overall planning process.



For example, the critical path may fall in the installation of structural columns, say 20 columns at 1 column per day, total durationis 20 cal. days.



The risk scenario may involved what if the installation of the first column will be delayed by five days, so the risk that the the project overall delay will be five days.



Then we asked the question: Is ther a way to accelerate the installation of column. Upon evaluation of site access and availability of space, it is not possible to install 2 or 3 columns in one day. So the risk that the overall project completion will be delay is real in the event that the first column installation will be delayed by 5 days.



Hmm, what do you think??



Charlie

Risk management is the critical factor for proper project planning and control. Unfortunately it is rarely properly applied. We analyzed project plans for many construction and other projects with the teams that created these plans. After risk analysis and simulation we found that probabilities to meet the targets that were set are in 20-38% range. The failure to meet the targets and the need for resource overloads was planned initially.



Besides project success criteria are contradictory. It is not clear if it is reasonable to pay more for finishing the job earlier. We recommend to set one clear project success criterion instead of requiring to meet time targets and cost targets. We recommend to estimate the cost of one day delay and set only Budget at completion as one single project success criterion. In this case time costs specific money and the management decisions became much easier.



If consultants are not involved in the real management they loose their qualifications - this is true.



You can read more about our approaches to project management in http://www.spiderproject.ru/library/mps.ppt



Regards,

Vladimir

Hi Charleston



I seem to recall these comments of yours in another thread "Why Projects Fail".



Best regards



Mike Testro

The greatest challenge in the construction industry is HOW TO DELIVER PROJECT SUCCESS



Base on the traditional criteria: WITHIN TIME/SCHEDULE, WITHIN BUDGET AND WITHIN QUALITY.



Base on the new generation of criteria: in addition to the traditional criteria: HSE for Health, Safety and Environment.



Regards,

Sensei

Successful Project Management Consultant

Hi Smitha,



Here’s a few reasons that lead to project failure in Construction Project Management:



- poor communication between engineering and construction

- weak management

- no project control



You can read the whole thing in this article Key Factors for Successful Construction Project Management, by Chris Hendrickson.

Hi Mike - yes, its true - I had a good ’clean-out’ saying all that! Of course, if everyone did everything ’correctly’ the job market for planners would be much thinner!! Another view of consultants I was told years ago says that they are people you hire to tell you the time and the first thing they do is to ask to borrow your watch!



cheers,



Omar

Hi Omar



I bet you feel better after that mind cleansing rant.



Why does it happen time after time?



It comes back to the dictum set up by George Bernard Shaw in - I think it was in his play - Man and Superman.



"Those who can do. Those who cannot teach."



I have added a litlle tongue in cheek addendum.



Those that cannot teach become consultants.



Best regards



Mike Testro

My experience has led me to see the following as just some of the causes of programme ’failure’ in the construction industry:(1) baseline programmes with little or no credibility because clients have set unrealistic goals (2) no acknowledgement that all programmes are a possible view of the future and should be constantly (what-if) analysed during the life of the project (3) non-ownership of the programme by some/all of the project stakeholders (4) the failure to control the front end of schedules (engineering) which absorbs all/most of the contingency float in the construction phase (where it is much more expensive to correct with less choices)(5) failure to carry out sufficient analysis during schedule preparation to understand the level of confidence in logic/durations to allow for sufficient time contingencies......etc etc. The causes are all well known for failure....the real question is why do we keep seeing the same mistakes repeated over and over?



cheers,



Omar

Anoon



looks similar to a financial crisis... too much speculation yet later realizing it’s unsustainable...

Hi All



I have always considered an As Built programme to be



"A record of the triumph of time and circumstance over human endeavour"



Best regards



Mike Testro

Its all about "ATTITUDE" .Never loose hope .

Dear Smitha,



This is the difference between the project estimation at Tender stage and the result of the Construction at the Project Close Out.



It depends on the size of the organization. For small companies, the person incharge of preparing the Tender might be the same person responsible for Construction. For larger organizations, you will have a Tendering department and a Construction department at the other end of the world.



Also, it depends on the type of project that you are executing, if it is a repeat project, then the risks are low and the return on investment would be knows. If it is a new project, the risks (positive or negative impact)

increase.



Since you are interested in risks then you can read the Project Risk Management section in the PMBOK and apply it in your thesis. The processes are;



Risk Management Planning

Risk Identification

Qualitative Risk Analysis

Quantitative Risk Analysis

Risk Response Planning

Risk Monitoring and Control



Good luck,



Samer

Hi All



In your childhood did you ever play a game called "Snakes & Ladders".



In the construction world the contractor is playing a never ending game of "Snakes".



The employer is the only one with "Ladders" on his board.



Best regards



Mike Testro.

There r different factors which makes construction industry so unorganised. So, if u r viewing it from Indian construction industry context, then there r different challenges as compared with Gulf region or UK or Australia.



Firstly, Indian companies r not getting enough manpower to execute the projects. Either most of the engineers turn their jobs to IT or finance sector OR else fly abroad to developed countries (Like me) in search of better personal growth and for monetary terms.



New mega projects like Golden Quadrilateral / Metro’s and ports and growing demand in building sector, and fast pace requirements of customer , has led to infusion of new materials, equipment and technologies to India. V r almost using same technology what is being used outside India. Consider example of Metro projects; Equipments and technology used in Indian projects and timeframe set for construction is as good as any other International project (either in Dubai or in UK). Even though manufacturing of new materials is going on at a more aggressive pace, the manufacturing of new equipment is constrained by large capital investments and the uncertain markets.



Even though government has given huge subsidies on equipment imports while construction of Golden Quadrilaterla project; on the picture of development of technically capable human resource, it is abysmally low. Apart from NICMAR and IIT (Delhi), there r no other good institutes, who have adequately invested into making technical human resources capable of addressing professional services needs of Indian Construction Idnustry like Litigation, contracting, insurance, equipment management, banking, finance and taxation.



Also, same case stands out for technology upgradation as well. Thats the time, when Sr. staff struggle during technology tranfer.



So, My advise wud be to add TECHNICAL MANPOWER as one of your topic other than low skilled manpower, literacy rate and psycological factors.



I have a gud article from Mr. Naik (L&T chief) stating the requirement of Civil Engineers in the Indian Construction Industry. Do send me ur mail id @ raviraj.bhedase@nakheel.com, i wil fwd it 2 u.



Cheers,



Rav

too much expectations, and find out later it’s not sustainable



no one is buying, as the concept just come out from random

Hello Smitha,

Reasons

Ego- irrespective of type of construction, i Believe it is one of the biggest reasons , unless the project manager can keep his flock together the project may go for a mess.

procurement failure - failure of proper planning and specially for procurement of construction materials in remote locations maybe one of the reason.

Not properly acclimatized with the construction area- This might be another reason a contractor who is based in europe and works in thailand may lose the project

(in terms of time and cost)



will come back with some more reasons.

regards

deb

Theres a lot



If u hav to write thesis, it can be thicker than Bible or Ramayan. If u can be little more specific, may be area specific or sector specific, somebody might help u, like



challenges in buildings OR BRIDGES, OR AIRPORTS OR PORTS OR PIPELINES OR industrial structures OR Chimney etc.



Cheers,



Ravi