NICMAR

NATIONAL INSTITUTE OF CONSTRUCTION .

. MANAGEMENT AND RESEARCH



Assignment No. 1

Date of Dispatch - May 5, 2014

Course Title - Management Information System
Course code - NCP 28

Submitted to - SODE office

Submitted By - Mr. Abhinav Thakur

Reg. No. - 213-08-11-11753-2151
Course - Post Graduate Programme in Construction .
Management


Acknowledgement

I would like to thank NICMAR / CODE OFFICE who gave me this kind of
assignment. While I was working on this project, I read some relevant books
and literature. I also did research on organization structure of some
construction companies.

I would like to thank CODE OFFICE for explaining the assignment
thoroughly and supporting me in preparing this project.


Abhinav Thakur













Statement
You are a project Manager on a construction of Hydel Power project
comprising of four main works viz. Main Dam, Weir, Electrical Power
Station and Tunnel. The requirement of ten-construction materials
including cement, steel (six sizes), sand, aggregate etc. needs to be
monitored daily Consumption, requirement, resources on site and in depot
need to be checked every day. Design an M.I.S. for efficient working.
Assume suitable data.













1. Scope of work:

1.1 Construction of Hydro-Project Project:
The above project is divided into four parts i.e.:
1. Main Dam
2. Weir
3. Electric Power station
4. Tunnel

1. Main Dam:
Normally dams are being constructed with Earth material, Masonry works
and concrete works. In accordance with the huge scope of work, amount of
material and manpower required for such project is huge. Due to the huge
scope of work proper material planning is required. The types of material
required for Main dam are basically Murom, rubble for soling & U.C.R.,
(sand, metal, steel, and cement for R.C.C. work), structural steel etc.

2. Weir:
Normally weir is being constructed inside the dam wall towards the water
catchment area. The structure will be round RCC walls with structural
steel for supporting the gates. The gates are being fabricated with
structural steel. So the types of material required for the weir is cement,
sand, reinforcement, aggregates, structural steel etc.



3. Electric Power Station:
Power station consists of main switchyard control building and switchyard.
Building required RCC works, U.C.R. Masonry, brick masonry work,
plaster, tiling, paints, doors and windows and switchyard equipments.
Switchyard consists of structural tower, high-tension power lines, and 40
mm aggregates for metal packing, proper drainage systems, and proper
permanent fencing with gates. The average height of the fencing should be
minimum 2.00 m. Proper road for the movement of equipments and
vehicles. The road should WBM with two layer of bitumen.

4. TUNNEL:
Tunnel is specialist job. For tunnel you need to have dragging equipment.
Excavation should be with rock breaker & shifting of materials from
tunnel site to outside area.


1.2 Design of Mis for Construction Process:
Due to vast development of construction technology and techniques of
construction management, it has becomes necessary to build up proper
management information system to fulfill the need of the management to
monitor and control the project effectively.
M.I.S. is a communication process in which information is recorded,
stored and used for decision making with respect to planning, operating
and controlling. MIS is not new but only computerization has taken place
in it. Due to computerization, speed and accuracy can be achieved and

large volumes of data can be stored, which helps in variety of alternatives
to take decisions.
When a MIS is to be designed, its scope objective, need and nature should
be properly defined. The objective of the MIS is derived from the
objective of the Company.


2. Material Management Organization:
The basic materials required for all above project: -- Cement, Aggregates,
sand, reinforcement, Murom, rubble for soling, rubble for UCR masonry
walls, structural steel for weirs and gates, structural steel with coating for
switchyard towers, 40mm aggregates for switch yard etc.
The basic needs of quality material management is to have readily
available quality materials required by the organization and to keep
optional levels of stock of essential & more used items.

Strategic
Developing vendors for critical items
Determining optimal levels of inventory
Reducing varieties of inventory


Tactical
Developing vendors performance measures
Determining the impact on material cost, availability and

procurement with design changes and now product introduction
Determining optimal re-order levels
Controlling high value inventory

Operational
Goods received, rejected and issued
List of excess and deficient items received
List of items rejected & backlog of supplies
Critical items received and value of inventory in hand
Stores in transit and in inspection


3. Inventory Control Measures:-
In material management, Inventary Control is an important function. The
basic need of I.C. is to ensuring the continuity of the construction work
with minimum investment in material is fulfilled. It is mainly concerned
with laying down the policies regarding how much quantity of material
should be held in stock so that the main aim of the material management
can be fulfilled.

3.1 Material Management Calculations:
The Economic Order Quantity or Lot Size can be worked analytically.The
relation between various parameters was developed by R.H. Wilson and F.

Harris and is known as the Wilson Harris Square Root formula.
The relation is worked out below and is based on the assumptions:

a) Demand over the period of cycle is constant and is known in advance
b) Consumption of material occurs at uniform rate.
c) The price of material is independent of the lot size of order.
d) There is no lead time in the replenishment
Let
A=be the annual demand in terms of units.
Q=is the lot size order at a time in units.
P=Price of material in terms of Rupees per unit.
H=Annual inventory carry cost/holding cost expressed in rupees of
inventory.
S= ordering cost.
Since the stock is depended at uniform rate over the cycle period,
inventory carrying cost/holding cost can be the cost over the average stock.
As Q, increases the number of order hence ordering cost reduces, but
inventory carrying cost increases, and vice-versa. The economic lot size
we have to balance the two cost of opposite nature.
If Q is the lot size the average inventory will be Q/2.
i) Inventory carrying cost will be
= (Q/2) x P x h
ii) Number of orders over a year
= A/Q
Total ordering cost = (A/Q) x S
Thus the total cost T= i) + ii) = QPh/2 + AS/Q

We have to find the most economical order quantity for which T is
minimum value i.e. dT/dQ should be equal to zero.
i.e. dT/dQ =Ph/2-AS/Q2
AS/Q2=Ph/2
Q2/AS=2/Ph
Q= (2AS/Ph) (i)


3.2 Economic Order Quantity:


The economic order quantity can be worked out graphically on the basis of
the balancing the cost of opposing nature. From the careful examination of
the graph (see attached), it is found that the graph the total cost is rather
flat in the region of the cost. This indicates that the EOQ in this region will
not very much and as such one costs and inventory cost or (a) working out
the ordering costs and inventory carrying cost or (b) pinpointing the exact
EOQ.
EOQ= (2*A*S/P*h)

Lead Time:

Material procurement is based on lead-time of material to be procured. As
the name implies, it is the period that elapses between the points of time
when the need for a material is contemplated and the point of time the
material actually available on the site of construction for use.

If no lead-time is necessary (a rather imprecation proposition) it would be
very easy to purchase material knowing its need in construction. Even if
procurement through purchase involves a lead time which is certain, the
problem could be tackled by planning sufficiently in advance so that the
need for the materials assessed well ahead of the its actual use and the lead
time is taken the care. So lead time is very important while purchasing the
material otherwise its affect will be as per following:
The lead-time in purchase is uncertain and if it is delayed it will
result in stoppage of work.
There may be unexpected shortages due to scarcity of material or
some unexpected difficulties in transportation.
The continuously rising prices and small quantities purchased frequently
may make the material costlier.

Safety Level:
At is always better to have safety stock on site. Because any circumstances
the material is not coming on the site is stopped. Then it will cause lot
financial impact on the project. So you need to have safety level of each
stock of the material.

3.3 Kinds of MIS Reports Required
Various MIS reports on inventory should be submitted to management
frequently and at regular intervals. This will enable the management to
take necessary action where there is any deviation from the budgeted
figures or the target. The following MIS of inventory prove to be effective

to achieve this goal.

Statement of General Purchase items of Inventory
Recording of Inventory Report
Product Cost Monitoring Report,
Freight Cost Monitoring Report
Monitoring Finished goods Reports
Inventory Dispatch Report
Stores Inventory Report
Dead Stock Disposal Report

Frequency of MIS Reports
I. Name of report
II. Frequency of Report -Daily /Weekly /Monthly
III. Freight Cost Monitoring Report
IV. Monitoring Finished Goods Reports
V. Inventory Monitoring Report
VI. Inventory Dispatch Report
VII. Stores Inventory Report
VIII. Recording of Inventory Report
IX. Dead stock Disposal Report
X. Product Cost Monitoring Report
XI. Statement of General Purchase




Items of Inventory:
The frequency of above reports conform to some particulars sets of facts
and circumstances and can be adopted with little modification to meet
individual need and requirement
Inventory Monitoring Report
Materials Management Organization
Inventory control measures
Two bin system

4. Site Storage and Reporting:
In Construction projects store department plays a very important role.
When any new projects start the Project Manager will first think about the
site office and site store. In addition to that the Project Manager needs to
prepare the Project Implementation Plan. In the project Implementation
plan Project Manager needs to think about the store and storage area.
There are two types of stores:
Open storage
Closed storage
Before making the open storage yard, Project Manager needs to think
logistics of the projects. Project Manager needs to think internal roads and
access roads to the open storage area.

5. MIS for Inventory Control
The main goal of materials management is to have readily available
materials needed by the organization and to keep optimal levels of stock of

items. To achieve this goal the certain types of information would be
needed. This information is discussed in this chapter.

Introduction
Since materials arc equivalent to cash, and since they make up an
important part of the total cost, it is essential that materials should be
properly safeguarded and correctly accounted for. Proper control of
material can make a substantial contribution to the efficiency of business.
The success of a company largely depends upon efficient purchasing,
storing, consuming and reporting of materials. Besides, material pilferage,
obsolescence, careless handlings, negligence in checking materials may
lead to reduce profit and hence it is desirable to have a good stores
organization to obtain the maximum advantages out of it. A good system
of material cost control reduces the cost of storage, capital tied up in
inventories and risk of loss from fraud and theft. It helps in keeping
perpetual inventory and other records to facilitate the preparation of
accurate material reports to management. It eliminates waste in the use of
material. Moreover, it prevents production delays due to lack of materials
by supplying proper quantities at the right time. Proper material control
system can make a substantial contribution to the efficiency of a business.

Even a small saving in material costs results in an increase in profits, so it
is imperative to operate an efficiency system of material control.

Objectives of Material Department
The main objectives of Material department for the purpose of MIS reports
are
1. To maintain an uninterrupted supply of materials.
2. To keep records of loss of production due to non-availability of material
3. Reduce the time and costs of detefll1ining and ordering material
requirements.
4. Allow non-disruptive changes to production schedule.
5. Forecast future needs for ordering material.
6. Forecast changes in material requirements resulting from production
schedule change.


5.1 Kinds of Information Required For MIS Reports
The following information are usually required by material department for
MIS reports.
Inventory Monitoring
Vendor Payment
Vendor Satisfaction
Present Stock Position
Efficiency of Buying

Statement of Price Revision
Recording of Material
Dead stock Disposal
Loss of Storage
Critical Shortage
Excess Material Issue Monitoring
Product Cost Monitoring
Scrap, Spoilage, etc.
Statement of General Purchase Items
Material Budget

5.2 Kinds of MIS Reports on Materials Required
Various MIS reports on Materials should be submitted to management
frequently and at regular intervals. This will enable the management to
take necessary action where there is any deviation from the budgeted
figures or the target. The following MIS reports on materials prove to be
effective to achieve this goal.

Name of Report
Critical Shortage Report
Production Loss Report
Inventory Monitoring Report
Vendor Payment Report
Vendor Satisfaction Report

Price Revision Report
Recording of Material Report
Dead stock Disposal Report
Excess Material Issue Monitoring Report
Product Cost Monitoring Report
Statement of General Purchase Items
Material Budget Report
Bin Card
Schedule of Quotations
Stores Inventory Report
Besides above reports the reports on the following matters on a period to
period basis should also be made available-
1. Summary of materials receipt, issue, etc.
2. Quantities and values of materials regarding receipt, issues and stock
should be included with cumulative figures.
3. Turnover rate: Management may be interested in total figures and
possibly in turnover rate of very expensive materials or products.
4. Availability of stocks and market trends: The market position with
regards to future deliveries and market trends together with price
movements.
5. Present stock position: Any significant decrease or increase in
amount of present stock with that of last period may be reported to
management. As stock reflects, capital unavailable for other purposes,
management may be interested to the ratio of stock to net working capital.

6. Efficiency of buying: This report shows how efficiently the
purchasing department served the production departments. It reports how
many working hours were lost due to delays caused by lack of materials;
was there much discrepancy between the price paid for materials and
supplies and market price at the time of purchase, purchase department
efficiency, etc.
7. Value analysis: This report shows the result of investigations into
such problems as:
a. Could components manufactured internally be bought at less cost from
specialists?
b. Would a cheaper material do the job?
c. Would less costly designs work as efficiently as existing designs?

8. Variances: If standard costing is in operation the material cost variance
should be analyzed into further details. Materials price variance would
reveal the buying efficiency or market fluctuations; material usage
variance would reveal efficient or inefficient use of materials or bad
quality of materials. Materials mix variance would show the effect of
changes in the mix of materials.
9. Input-output ratio: In process industries it is a valuable report to
show the percentage losses that have occurred at each stage. It measures
the productivity of material.
10. Scrap, spoilage, loss of storage: Special reports on scrap,
obsolescence and abnormal losses of material amounting to a figure in
excess of a certain amount should be submitted to management.




6. System Development, Data processing and Flow charting
6.1 System Development Life Cycle
The traditional software development methods are structured system
analysis and design (SSAD) by Ross: the Requirement Driven by Alford
and the Structured Analysis and Structured Design (SASD). All these
methods deal with function and data separately. The modern methodology
is object-oriented, where the functions and data separately. The modern
methodology is objected oriented, where the functions and data definitions
are viewed together as an object.
A System Development with the SSAD the similar approaches are
difficult to maintain. The reason is that for each function and its behavior
the data structured is defined. The functionality behaves correctly under
the conditions of rigid data definition and structure. However in real life
time the data format changes, call-in for change in the programmed.

6.2 Data Processing:
In any information system application, the method generally followed is to
design modular and hierarchical steps of processing leading to an output in
a report form or information having certain value specific or perceived as
seen by the user. The steps involved are data processing, transaction
processing, application processing and system processing.
Data is the smallest automatic entity in the information system which is

basic to build the information system. The automatic data entity is defined
as the value attached to an attribute which has a character, meaning and
presentation providing specific message and understanding to its viewer or
user.
Hence, data processing means following steps or stages to be
implemented before the data is accepted in the system for usage.
Confirming the character, the structure and presentation Vis--vis
data design.
Checking the value of the data Vis--vis data value specification
such as single specific value, range of value and limit ranges.
If a non-conformance is seen, point out the error and seek corrective
response before the processing controls shifts to a new field.
















6.3 System Flow Chart

Hydel Power project
Resource
allocation
Utilization of
resources
Update Records
depending of
physical
balance
Consumption
records of files
pertaining to
available resources
Wastage of
resources
Valid File of
All Data
Out Put File
Master File
Back Up
Resources Document procured at site
including mobilization of man power
Information Report related to
completion of task
Screen
Display
Progress related
to billing
amount
Data
Processing
Records
related to
completed
jobs

7. File structure
A file of data contains the attributes of a large number of items or
entities A personal record file would contain data about a large number of
employees in the organization. The data about one teacher form one record
in the file. The file containing data of about 50,000 teachers would
contains 50000 records one for each teacher. These records may be
grouped into groups of 5, 10 or more records each for the purpose of
convenience. A group of records is called a Block each record contains
various attributes of the teacher.
File Media: Files of data for computer based information system can be
maintained on any of the acceptable input/ output media. The commonly
used file media are
Punched cards
Magnetic tapes
Magnetic disks
Models of file organizations
1. Pile file
2. Sequential file

3. Indexed sequential file
4. Indexed file (inverted file)
5. Direct file
6. Multiring files
Structure of data base:
The records of entities and the relationship among entities in the data base
are organized into a structure called schema the schema of the entire data
base may be designed and maintained by the data base administrator.
Models of data structure:
Data base system can be categorized according to the models of data
structure they use in building the conceptual structure or schema of the
data base. One of the three approaches is used in most data base system viz
Hierarchical model
Network model
Relational Model




8. Bibliography/ Reading
Management Information System. Published By Nicmar
http://insidesap.wordpress.com/2011/11/15/mm-structure/