The Deployment of Human and Financial Resources - Assignment Example

Assignment 5 5 Depending on the type, size and complexity of a project, there are several models of forecasting and planning that can be used to plan the deployment of human and financial resources to a construction project. All procedures and systems that are put in place for the purposes of forecasting and planning for resource deployment are: Lifecycle analysis Value analysis Commercial management Benchmarking Contract documentation and engineering Cost modeling and planning Due diligence Cash movement management Capital feasibility estimates Project audits Real Estate due diligence (if required) Risk quantification and mitigation Supply Chain Management Construction legal services Forecasting & planning techniques for human resource deployment. The following column shows a portion of the Human resource plan for a project. Human resource category Number of staff Cost assumptions When needed Till what date the staff is needed Special skills, if any Special needs, if any Training needs, if any Office and material equipment (Mishra 3) There are four levels of construction management: Organisational: This the topmost level, concerned with the legal and business structure of an organization. Project: Project level management deals with project phase planning, resource deployment, project cost planning and resource scheduling. Operational: is the management of technical details and logistics within a project at field level. Task: This level of management is essentially concerned with efficient work allocation to crews and workers. ( Daniel W. Halpin. Ronald d. W. Woodhead, 1998) Human resources planning in a construction project has the following steps, if followed, reduce risks for the project execution. Needs Analysis: The project team needs to assess the project's present and future needs for human resource. It may further be divided into five stages Examination of the organization to see people's skill sets and skills needed in the future. Identify the required technology required to do the jobs, and therefore the skills the employees will need. Correlate qualifications of the employees with the skill sets required. Establishing performance benchmarks to test and assess an individual's suitability for his/her role in the project. Needs analysis is usually done for middle and higher management, and its positive effects seep down to project level at planning level. Human Resource Evaluation: is the evaluation of current employees to assess suitability to current job and skill requirement in terms of interests, skills, experiences and overall abilities. Job analysis & Design: Involves the restructuring of an organization to optimize its human resource, to best meet the possible forecast requirements for human resources for any project. Analysis of Internal Availability: The organization reviews the availability of its current employees before deployment to a project. Job descriptions & Specifications. Employees with the most suitable skills and capabilities are shortlisted for deployment, with a degree of flexibility to mitigate unforeseeable risks. Training and development. Providing project-specific training to shortlisted employees Impact of Human Resources deployment planning Technical performance: An ability to meet technical requirements of the project. Technological innovativeness: The team on site is able to meet challenges to problems technical in and find solutions that are fast, efficient and cost-effective. Project efficiency in execution: Overall improved adherence to time and cost projections for the project. Team performance: is effective towards reducing risk, streamlining decision making, improved information exchange and a higher level of motivation achieved through teamwork. Possible Difficulties in this process Methods to negate problems / difficulties Ill-trained personnel deployed to site. Deployment only after appropriate training and vetting of skillsets Attrition of personnel during project attrition Project continuity assured through teamwork, where contingencies in terms of attrition are addressed. In addition to that, higher level of motivation reduces attrition. Poor inter-personal communication A team trained as a cohesive unit improves communication, reduces errors. Wasted human resources lying idle Due to an overall study of available human resource with the organization, people may be moved around between projects to maximise returns, and to reduce bench-strength. Forecasting & Planning techniques for financial resource deployment. Financial resources planning is essential to provide correct construction decisions before and during project execution, so as to reduce risks and enable project completion within planned amounts for procurements, contractual payments and to control actual quantities of physical resources used in the construction process. A. Cost information: Price books and manuals. Published indices of costs. Consultants, vendors, manufacturers and suppliers. CDM coordinator. Costs inputs from similar projects. B. Market information Market conditions including inflation and deflation. Change in material price and/or specifications. Flexibility in labour cost. Cost Planning Processes 1. Feasibility Study: Determines rough cost of project on the basis of site details and basic building parameters. No drawings involved. Known as Preliminary Cost Estimate. 2. Outline Proposal: Determines initial cost studies to define cost limits, and is prepared on the basis of preliminary design drawings. Known as Elemental Cost Estimate. 3. Scheme Design: Determines detailed cost studies to confirm detailed budget, and is prepared on the basis of detailed working drawings and service Design Basis Reports and requirements. Known as Revised Cost Plan. 4. Tender: At this stage, a cost check of the whole design is made. Complete design and specifications are available at this stage. Known as Pre-tender Cost Estimate. Immediately prior to final tendering, reconciliation of cost plan is done This involves reconciliation of: Design / Specification changes. Cost changes between initial and current designs. Any changes due to human or contractual factors. A complete overview of Life-cycle costs to be planned is given the diagram below. These include Building, Non-building and maintenance costs. BUILDING COSTS LIFECYCLE COSTS NON-BUILDING COSTS Prerequisites to Successful Financial Resource planning Establishment of a stable model of documented systems, including chain of command and procurement, with clear prioritized needs. Study of as many feasible sites and building configurations and design options as may be possible keeping within initial parameters of design requirements. Establishment of manageable work schedules and task planning. Insure unanimous approval of budget and monetary outlay by all participants in the project. Quality control of contract documents and management during construction. (Eliufoo Pg 9) Methods to maximise value from Financial Resource Deployment Planning Update estimates with changes. Value management through cost checking and feedback. Study and use of appropriate construction delivery methods. Use of appropriate technology. Cost management during construction. Study of design and construction schedule. Control of inventory on site of all material, with oversight of materials. Stress on best practices of Safety and Health. Thorough Quality control. Benefits of Financial resource Planning Better control of all variables of a project is identified earlier, resulting in tighter controls on quality. Move value for client money. There is budget and value accountability at every step and phase of the project. Potential roadblocks in terms of design and/or specifications are identified, isolated, and resolved earlier. High-cost elements are identified, and possible changes arising out of the budget can be made. Better flow of information up and down the value and executive chain. Better construction quality. Pre-consideration of contingencies allow flexibility in budget execution without derailing the project execution. 5.2 Techniques and procedures for the control of human resources on a project: Practice of clearly demarcated procedures with no ambiguous activities. Practice of HR guidelines and Procedures. Maintain a clear chain of command at site level. Maintain complete records and documentation of all HR activities, decisions. Strengthen information flow up and down the chain of command. Maintain a constantly updated document on HR allocation, and review of targets. Deploy Human resources such that all skillsets are utilized. All department heads submit periodic reviews of their departments with respect to targets and achieved milestones. Have a constantly evolving system of incentives for personnel. Encouraging an open attitude to change and flexibility in terms of methodology and technique. Merits of these systems: Higher efficiency of project execution. Higher level of technical competence and innovative problem solving in times of high-stress. Higher degree of adherence to deadlines. Better teamwork, therefore less finger-pointing, and higher per-capita productivity throughout the team. Personal growth of all members due to incentives and constant learning. Macro advantage of lower attrition from the organization due to better morale. Enhanced managerial and organizational competence. Reduced resistance to change, therefore lesser conflicts. Better overall business performance of the organization due to reduced error cost. Techniques and procedures for the control of material resources on a project: Pre-design set-up of procedures to be followed, principally documentation for material procurement and allocation. Use of management and inventory software, integrated with the design software like revit, where every change translates into real-time changes in specifications, quantities and cost. Tenders for high-cost systems and long-lead items to be researched and released to chosen pre-approved vendors only. Design specifications to be finalized and approvals for procurement should be taken in writing well before procurement begins. Complete list of plant and equipment required to be used during the project. Making and maintaining daily logs of all inward material and of all issued material to crews on site. Measurement sheets of all work to be checked regularly. Expensive earthmoving and other limited use equipment to be brought to site for only the period when needed, to reduce rentals, as also this equipment to be operated only by qualified personnel to maximise output. Merits of these systems: Cost control at every stage of the project. Constantly updated costs keeps employer aware of how much every design / specification change will impact the overall cost of the project. Material inward logging reduces wastage and maintains strict controls on usage of the material. Quantity sheets of all work allow checking of efficiency of material usage. Due to the systems followed, contractual commitments are followed more diligently, avoiding problems later on in the project. The bidding process is transparent and the best possible material can be purchased at a good price. Purchase planning ensures the contractor has working capital at all times, as points of monetary outflow are marked previously, allowing preparation. Construction Best Practice Programme (CBPP) defines benchmarking as a systematic Process of comparing and measuring the performance of the companies (business activities) against others, and using lessons learned from the best to make targeted improvements. (Takim et al Pg 547) Evaluation of the effectiveness of human and material resource control can be done setting up and analyzing KPIs for all the different stakeholders in a project; the clients, contractors, workers, consultants and the suppliers. Benchmarks, both internal and external, assist in evaluating performance of all stakeholders in the project. KPIs for Human Resource Management: Employee Satisfaction Staff turnover (attrition) Sickness absence Working hours Qualifications and skills Equality and Diversity Training Pay KPIs for construction: Client satisfaction - Product & Service Defects Predictability - cost and time Profitability Productivity Safety Construction - cost and time (www.KPIzone.com) 5.3 Monitoring techniques are applied to projects to monitor and control scope, cost and schedule. The merits are: Evaluation of the project on chosen parameters. Value Engineering to increase return on investment from all resource inputs. Preempt small problems from becoming large issues. Constant knowledge of resource allocation and performance of parties on site. Opportunities to improve performance on all parameters by observing previous trends and analyzing past performances. Choice of items / activities to monitor and monitoring frequency of activities within the project depend on: Criticality of the activity. Monitoring is more extensive and frequent for activities that are an important part of the Project Critical path, to the extent that all activities that lead up to it are also monitored extensively to mitigate any potential risks in the timely execution of these activities. Time frame and sub-components of the activity. An activity that has several components that have to come together over, say, a 36 hr period, shall be monitored at the beginning and end of each component sub-activity. For Example, in the installation of chillers on the roof of an office building, both points above can be illustrated. Criticality: Installation is a 36 hour process, and factors like availability of the crane, completion of chiller platforms on terrace, completion of housing nuts, presence of HVAC personnel for pre install check etc all have to be arranged for and checked as per delivery schedule. Deviation from the schedule would mean loaded trucks standing on site, and expensive equipment lying vulnerable to the elements. Timeframe: In the activity mentioned above, there are several independent sub-routines that will need to be monitored. Type Activity Activity Length (Hrs) Monitoring freq. Pre Dispatch from Manufacturer Point activity once Pre Release from customs 6 twice Pre Travel of chillers to site 36 6 hourly Pre Arrangement of crane 2 4 hourly Pre Preparation of electrical supply and meter 72 Daily Pre Preparation of platform 120 Daily Pre Installation of bolts 12 twice Core Unloading and raising chillers 12 2 hourly Core Installation 48 Twice a day Post Testing 72 Constant As a rule, High precision and High cost activities are deemed to be critical, needing frequent monitoring and constant evaluation. 5.4 There are five ranges of actions that are taken after analysis of project monitoring data. 1. Evaluation: against KPIs to improve overall efficiency and to meet goals on performance and resource optimization against the industry average. 2. Self-criticism: by the project team to improve performance by critically dissecting each step and suggesting improvement. 3. Risk mitigation: Apparent problems become apparent in the initial stages, and corrective action can be taken before the problems become very costly and time consuming. 4. Replanning: to correct deviation of the project or its parts from original plan. 5. Corrective action: Corrective action may include: - Statement of work modification - Modification of requirements - Revision of estimates and plans. - Commitments may need to be renegotiated. - Adding resources - Changing processes - Revising project risk assessment and methods for mitigation may be reviewed. References 1. HALPIN, DANIEL W, WOODHEAD, RONALD W, (1998), Construction Management, 2nd Edition, John Willey & Sons, Incorporated, Canada. 2. MISHRA, SUJIT. Human Resource Management in a Project, PM World Today, July 2007 (Vol IX, Issue VIII) 3. TAKIM, R. & AKINTOYE, A. (2002) Performance indicators for successful construction project performance, IN GREENWOOD, D. J. (Ed.) 18th Annual Association of Researchers in Construction Management (ARCOM) Conference, Newcastle-upon-Tyne pp547 4. ELIUFOO, HARRIET. Effective Cost Planning in Buildings and User Participation: A case study approach, http://www.lth.se/fileadmin/hdm/alumni/papers/icm2000/ICM2000-18.pdf Retrieved on 10th May, 2009 5. PILLAI A.S, JOSHI A, RAO K S (2002). Performance measurement of R&D projects in a multiproject, concurrent engineering environment. International Journal of Project Management (2002), pp 165-177 Read More