Ihab Saad – Resource Management
AI: Summary ©
The speaker discusses the importance of resource management in managing construction projects, emphasizing the need for specific availability and cost. They explain various methods for resource allocation and resource allocation, including identifying quantities and production rates, assigning budgets to each activity, and working on a least possible time and resource allocation. The process involves tracking and analyzing the project, estimating resource consumption and unit prices, and assigning critical resources to each activity. The goal is to minimize resource consumption and maximize efficiency, and resources will be allocated according to priority and assumptions. The speaker emphasizes the importance of prioritizing and following activities to ensure maximum efficiency and maximum efficiency.
AI: Summary ©
Welcome to another scheduling class, and today we're going to
talk about an introduction to resource management, how to manage
resources in a project. First of all, what's the definition of a
resource, and then how are we going to manage these resources
successfully?
So the contents are going to be introduction to what resources
are. And then how are we going to allocate these resources to
different project activities? Then how are we going to graphically
represent these resources and resource distribution through
what's called a resource use or resource loading histogram, and
then the cumulative curve, which is a compilation of that
histogram. And finally, how are we going to level these resources, in
case the use of these resources, or the need for the resources
exceed that resource availability?
So first of all, the definition of what a resource is. For something
to qualify as a resource for a construction project, it needs to
meet three criteria. The first one, it has to be needed for the
project. So if it's not needed, it's not a resource. Second, it
can be managed. So if you cannot manage it, it is not a resource.
Sunshine, for example, we cannot manage that so it would not be
considered as a resource. And the third one is it has to cost money
to acquire to be considered a resource. Again, air that we
breathe, we need definitely to live, rather than to work. But
since it's free, it cannot be considered a resource. On the
other hand, compressed air which is going to be manufactured,
compressed through a compressor. In this case, it can be managed,
and we pay money to acquire it through the cost of the
compressor. In this case, it's going to be considered a resource.
Examples of construction resources include the four M's. That's an
easy way to remember them, manpower, which is labor,
machinery, which is equipment, materials. And finally, the most
universal
resource, which is money, since it can be translated in any of the
other three resources, hiring labor is going to cost money,
purchasing or renting or leasing machinery or equipment is going to
cost money. And buying the materials, it's gonna cost money
as well. So the first three types of resources can be translated
into a monetary quantity, a part of financial resources.
Resources also can be classified under one of two different
classifications, either stackable or non stackable. Resources
stackable, also known as stockable, which are resources
that can be acquired in bulk and stored or stacked for a later time
to be used whenever needed. Examples include some materials
like wood, for example, pipes, electrical supplies, things like
like that. Own capital, if you have your own capital, your own
money that you're going to be working with, it can be stocked or
stored in a bank, owned equipment, which can be stored in a
warehouse, and some other types of some types of information, like
records, for example, if you have something on record, In this case,
it's considered as a stackable or stockable resource.
The other type, which is the non stackable, or non stackable, are
resources that have to be used as soon as they are available.
Otherwise they cannot be used later, which is basically use it
or lose it. Examples include labor productivity, if you have a crew
of labor today, and you don't use the productivity of this crew of
labor, then that day is lost, borrowed money. Again, if the
money is borrowed and you do not utilize it, then it doesn't have
any value.
Rented or leased equipment, if you rent the equipment or lease it and
you do not utilize it while you're renting it, then again, its
production date is lost. Some materials like ready mixed
concrete. Ready mixed concrete cannot be in its final shape,
cannot be stored or stacked for a while, except for maybe 45 minutes
to an hour or so, but no longer than that. So whenever it's
available, you have to use it immediately. And some types of
information that has volatility or it has to be acted upon
immediately so that it will be useful or valuable, like stock
market for example, stock market information this is this varies by
the minute, so if you act late, that's that's going to cause a
problem.
The third thing that we need to know also about resources is their
availability limit. In how many units is that resource going to be
available and for how long? So under the availability.
Limits. We have two different types. We have something called a
normal limit, which is under normal conditions and without
reaching extreme measures, this amount of units of the resources
are going to be available for immediate use. So it's available
at any time without having any problems.
The other type, the second level, or limit of availability is going
to be called the maximum limit, which is under extreme measures,
if push comes to shop, if I have to do it right now, this is the
maximum amount of resources that have that can be made available.
It's usually greater than or equal to the normal limit.
Peaks are going to be any amount
any demand of that resource exceeding the maximum availability
limit. So if I need, for example, three bulldozers today, and I only
need two, then I have a peak of one extra bulldozer. It results in
the project being delayed if on a critical activity, because again,
the only way to do a job that requires three bulldozers with
only two is to extend the duration of the activity. If it's a
critical activity, then the whole duration of the project has been
extended.
This is a graphical representation of what we're talking about here,
so we can see, for example, this is this green line represents the
normal limit, and this red line represents the maximum limit. This
is the aggregation of resources. So today I'm going to need three
units of that resource, if this is three, for example.
And here we're going to need four. Here we're going to need five.
Here. We're gonna need if the maximum level is seven, for
example, here we're gonna need eight. Here we're gonna need four.
Again, here we're gonna need nine. So that resource demand varies
depending on the activity being done on that particular day. So on
the horizontal axis, we have the time. On the vertical axis we have
the resource units, or their translation into the universal
resource, which is money or cost. So obviously, here we have a
problem with these two peaks
the project as such, if these two peaks occur on critical
activities, this is infeasible. Even if it's on non critical
activities, it's still in infeasible or non feasible, unless
and until we get rid of these peaks, we notice also that we have
troughs,
which is areas where
I can afford having this resource but I don't need it. So if you
have played Tetris before, for example, you know that the secrets
to the secret to lasting in Tetris is to manage the shapes and try to
fill the troughs with the peaks. And this is exactly what we're
gonna try to do. We're gonna try to see if we can take that peak
and fill in that gap or that trough. So by redistributing the
resources, this is what we're gonna call later, resource
leveling.
Some examples of resources include salaried labor, like the project
manager, Superintendent, Project Engineer, Secretary, lab
technician, security guard and others. If you notice, all of
these do not perform any physical work on the project. Their job is
primarily supervisory or administrative, but they do not do
any physical work like they do not lay concrete, for example, or
install tiles or vinyl or carpet or paint walls. They do not do
that. They are tied to a project, but not tied to one particular
activity or work package, and they get paid a fixed salary, therefore
mostly indirect costs. The salary of the project manager is
independent of how many cubic yards of concrete have we placed
today.
On the other hand, we have the hourly workers or the daily
workers, or the
the workers were, whose payment depends on their performance or
the amount of work that they have done. So they are hired to perform
a specific task or activity, like carpenters, masons, iron workers,
electricians, for men, etc. And they are pet for actual hours
work. Therefore it's mostly direct cost, as later we're going to talk
about direct and indirect costs in another lecture. Their production
rate is a conversion factor between achieved quantity and the
number of hours worked. So the production rate is the quotient of
amount of work divided by number of hours worked. If you notice
that
p is equal to q over T, remember the equation that we used to you
before T or duration or time is equal to q over P, quantity
divided by production rate.
And here, if I want to know the production rate, I can divide the
quantity by the number of hours worked, and that would give us
units per unit of time, like cubic yards per hour or tons per day and
things like that.
For the equipment, equipment that assists. We have different types
of equipment as well, equipment that assists in the construction
process, not permanently installed in the project. It's just used to
achieve work activities, like a tower crane, like a loader, like
an excavator,
power generator, forklift, temporary power generator, just
for construction. It's similar to direct labor. Its cost is derived
from the completed quantity of work, related to the number of
hours that it has worked and the hourly rate. Inexpensive personal
tools are usually treated differently, either as a lump sum
for all tools, or as the laborers personal property. So it's going
to be part of the labor cost, trowels, for example, or
10 tools that are going to be used by labor. Hammers.
On the other hand, we have the installed equipment which stays
permanently in the project after completion, thus becoming part of
the direct cost priced in the bid. Examples include heat pumps,
generators that are going to be permanent in the project, for
power generation on the project, while it's operating air
conditioning units and so on and so forth.
Elevators,
materials, construction materials for use, for construction, but not
being part of the final project deliverable still treated as the
red cost and part of the pricing of the relevant bid items.
Examples include formwork, scaffolding, shoring, etc, is not
going to be part of the permanent work, but it's needed to achieve
that permit work the other on the other hand, we also have the
installed material which is part of the final deliverable, and
therefore the direct cost. Examples include concrete, rebar,
concrete masonry units, bricks, blocks, insulation, tiles, paint,
etc. All of these are materials that are going to be part of the
final completion of the project.
So money is the financial resource used in construction, and there
are two methods are available for assigning budgets to activities,
either assigning a lump sum amount for each activity, without
specifying how the number is sliced or which resources are
used. So for example, we say this activity is going to cost 5000
pounds, $5,000
these $5,000
can be the cost of the material, how many cubic yards of concrete
the cur, the cost of the crew of labor that work to place this
concrete, the cost of the equipment that was used. So I
converted all of these different units into money, and I added it
up, and that was the cost of the activity, or assigning a number of
units of certain resources to each activity, together with the unit
price for each of these resources. So I can say this activity is
going to require one bulldozer, one foreman, one equipment
operator, two laborers, etc, and then knowing what is the hourly
rate? And for how long am I going to need these resources? I can
translate that into money.
So resource allocation is basically assigning different
resources to different activities and assigning their costs to that
activity as well. So the construction planning process
includes the assignment of different resources to activities,
also known as this process called resource allocation in the
project, monitoring and controlling process the
consumption of resources should be tracked and compared to the plan,
I have estimated that this activity is going to need 200
cubic yards of concrete. While placing the concrete, I have
ordered the concrete from ready mix supplier. I've been tracking
the shipments arriving on site, and I've been tracking the
placement of the concrete, and I found that there at the end that I
needed 210 cubic yards. So maybe there was a loss or waste of 10
cubic yards, or maybe the original quality that was estimated was
less than what I'm going to need for the project
resource planning, monitoring and controlling can help project
managers understand resource demand versus resource supply for
major pieces of equipment, trained workers, and so on and so forth.
So for example, we may say today, I'm gonna need 500 man hours of
carpenters.
So this 500 man hours can be achieved by 500 carpenters, each
one working for one hour, or 50 carpenters, each one working for
10 hours, or any.
Combination there in between.
So we have to understand the project status and the cost, to
control the project cost and schedule that's going to result to
be the result of using these resources.
So the process for resource allocation, we have to identify
all the resources that need to be assigned and tracked for the
project. Identify the quantities of these resources and their
production rates and unit prices.
Assign critical resources to each applicable activity. So we're
going to start with the critical activities, because they are more
critical, therefore they need to be supplied and satisfied with the
resource supply before any other activity, develop a histogram or
table of resource consumption over time, monitor the availability
limits to ensure not exceeding the maximum available limit. So I'm
going to draw horizontally the normal limit and the maximum limit
to make sure that I do not exceed the maximum limit, and develop a
contingency plan in case of exceeding the availability limits.
In case I have a few peaks, what am I going to do with these peaks?
How can I reassign them to other areas where I have resource demand
less than the resource availability therefore I can
flatten that peak, and have a smooth resource distributor.
Looking at an example. Here we have a few activities. So on this
side, we have the activities, and then we have their predecessors,
the crew, size,
labor. How many labor am I going to need the daily output of that
crew? And then the planned quantity that has been measured
from the drawings and the specs, and then the next step would be to
assign how many days for how long am I going to need these
resources? Again, remember q over p, so this is q and this is the
production rate, or output p. So by dividing Q over P, I'm gonna
get number of days. And here, in this case, if we deal with full
days, not increments of days, I'll have to round up. So for example,
here we have 280 linear feet, and I can produce 100 linear feet per
day. So 280 divided by 100 gives 2.8 which is going to be rounded
to three. Therefore it becomes, here I'm going to need three days,
323124,
etc. That's based on the resource availability, based on the
resource the resource production rate, and based on the total
quantity for that activity.
So the next step is going to draw a timeline, a draw a histogram. On
the horizontal line, I have time. On the vertical line, I have the
resources. And then I'm going to plot these resources. How many
units am I going to need per day and so on based on these crew
sizes. In this case, labor is the resource to be planned for.
Now, when we are allocating these resources, the old school said, Do
not be constrained by the resource availability. Assume an unlimited
resource availability and build your schedule accordingly, and
then look at the resource availability and adjust it
accordingly. And then later on, it was found that this is a very
futile process, because we'll have to do everything twice. I made an
assumption, and this assumption is not correct in the first place,
because I was assuming unlimited resources, there's always going to
be a limit on some of the resources. Very rarely is there
going to be an unlimited supply of resources. So according to that
first assumption, you assume that sufficient resources are available
to carry out the project, which must be completed by specified due
dates. So the only constraint is on the completion of the project.
And then the second iteration in that process was we said we're
going to combine these two steps, assuming unlimited resources, and
then adjusting later on into one step. So we're going to start with
the assumption that we have. We recognize that we have a limited
resource availability, and we're going to play a plan accordingly,
by, again, including these two horizontal lines, the normal limit
and the maximum limit, and taking that into consideration while we
are developing our resource loading histogram. So there are
definite limitations on the resources available to carry out
the project. And the objective is to meet the project due dates in
so far as possible, which is minimizing the duration of the
project being scheduled subject to stated constraints on available
resources, which means I'm going to try to finish the project in
the least possible time.
Within the available limitations on my resources,
long range resource planning. Management seeks to determine the
combination of resource levels and project due dates that will
minimize resource costs, overhead costs and losses, which result
when project due dates are not met. So now we are going through
an optimization problem, not only meeting the deadline within the
number of resources available, but what would be the best possible
use of these resources so that I can minimize the total cost of the
project and finish it still within the available time. You
so in resource allocation problems, the basic approach to be
followed in solving each of these problems is to first order the
activities according to some criterion, and then to schedule
the activities in order listed as soon as the predecessors are
completed and adequate resources are available. Basically what
we're talking about here the criterion, the main criterion to
resort the activities is going to be their criticality, whether the
activity is critical or not. So we're going to solve the network,
draw a bar chart or solve the network, and identify which
activities are critical, which activities are non critical, and
pay our first attention to the critical activities. So they're
going to be our first recipients of the resources.
Here, for example, we have limited resource availability, and we need
to allocate these to the this project. So here we have two
activities starting the project. This is the project start, two
activities starting the project. And then we can, basically, based
on this table here, we drew the network. We can then solve the
network to get the different dates, early start, early finish,
late start, late finish, and so on and so forth. Determine which
activities are critical, which activities are non critical, and
then start allocating the labor or the resource demands for these
different activities and drawing our resource loading histogram and
seeing whether we're going to be able to meet that maximum limit,
to be below that maximum limit of six labors or not. First of all,
we can notice here that activities A and B, since they occur at the
same time,
activity A requires two labors. Activity b4 labors. So basically,
we're gonna need six labors for at least the first
four for at least
the first five days of the project. And then once activity is
complete, there's going to be a need for two more for activity B.
But once activity is complete, activity c is going to step in.
And so is activity D is going to wait until B is complete. So
again, we can draw the Gantt chart and assign resources according
we're going to see an example of that.
So here's the network. We have solved it, and then we are going
to schedule the resources by the early start. First of all, we have
to satisfy the critical activities. And that activity A,
we're going to notice that it has two days of float. Activity C has
four days of float so we can maneuver with these activities in
order to try to avoid that peak as much as possible.
Based on this resource distribution, on the first day,
I'm going to need 66666777,
and so on. You can see the resource demand now this seven
here resulted from
resulted from four on B and three on c4,
on B and three on C. What if I moved activity C along its total
float to avoid that excess moved it by two days so I delayed it by
two days of its total float. So instead of starting on day six,
we're going to start it on day
let's say nine, or day even day eight. If I start on day eight,
that's going to be okay. So in this case, the demand for days six
and seven is going to be only five, which are from activity B.
And then here we're going to have three from activity D and the two
from activity
c, or whatever it was for activity c3, from activity c, so three from
D and three from C, therefore it's still gonna be within my maximum
limit. So I now have solved that peak that is.
Started from B and C being at the same time.
So here, when I moved activity c little bit. Now I still have float
on activity c. And now, as you can see, the resource peaks have
disappeared, and my resource utilization is within the maximum
limit, which is six. And the project duration did not change.
Here it was 14, and here it was 14. So I finished the project on
time. I have satisfied the different objectives that I had.
Now, if I want to do that for multiple resources, here I assumed
only one resource, which is the labor, but if I have multiple
resources to be done, labor, equipment, materials,
subcontractors, etc, it's
not going to be that easy. It's going to be a little bit more
complicated. So we'll have to start now thinking about different
strategies to reducing these peaks.
First of all, can the activity be delayed beyond this early start
without delaying the whole project, as we did with activity
c, we moved it along a sort of float. If we can do that and that
solves the problem, great. If not. Can this activity be split into
smaller chunks. So I can split it into two parts. Start, one little
bit earlier. Start, one little bit later. If I can do that to avoid
the peak, then again, that would be great. Can the activity be
started and then paused for a while to avoid the peak and then
resumed later on again? If I can do that, that would be great. If
none of the above solutions work for the non critical activities,
then going to start thinking about the same solutions for the
critical activities, knowing in advance that this is going to
delay the project or increase the duration of the project.
Here is a flow chart that shows basically what talking about here.
So calculate initial early start and they start for each activity,
determine the initial eligible activity, set those activities
with all predecessor activities scheduled, and so on. You can read
basically on that that's just a an algorithm to show you how to solve
the resource allocation problem. And as I said, if you have two or
more resources to be allocated and leveled or planned for and smooth
at the same time, most likely the software is going to do that for
you, because it's going to involve so many different permutations, so
many different probabilities. So the easiest way to do that is
through the software, following that algorithm that we're looking
at.
So basically, this is a brief introduction about resource
allocation. We are going to solve a numerical example. I'm going to
post that on Blackboard so we can see how to address this problem
and how to solve for different probabilities. I'll see you in
another class. You.